M.P.T. – Modern Portfolio Theory
Modern portfolio theory is the philosophical opposite of traditional stock picking. It is the creation of economists, who try to understand the market as a whole, rather than business analysts, who look for what makes each investment opportunity unique. Investments are described statistically, in terms of their expected long-term return rate and their expected short-term volatility. The volatility is equated with “risk”, measuring how much … [ Read more ]
Content: Article | Source: “moneychimp” | Subject: Finance | Industry: Investing
How Finance Works (moneychimp)
Most of finance is built from a few standard formulas and strategies. For example, investments tend to grow like compound interest and pay out like annuities; and you judge them by estimating future profits and then calculating present values or equivalent rates of return.
So here are the basic building blocks, from the easy to the ugly.
This article uses interactive graphs to demonstrate some … [ Read more ]
Content: Online Resource | Source: “moneychimp” | Subject: Finance
MoneyChimp
Finance skills a little rusty? Do you find yourself reaching for that dusty finance textbook to decipher the CFO’s memos? MoneyChimp will let you brush up on your lackluster numbers knowledge and learn about concepts like modern portfolio theory and how to trace cash flow. The site offers a full toolbox of calculators covering topics such as stock and bond valuation and the time value … [ Read more ]
Content: Online Resource | Source: “moneychimp” | Subject: Finance