The idea of putting all eggs in different baskets is inherently based on pure math and the way the risks are lowered non-linearly, while returns being the average return on the instruments. Continue reading Diversification and why having all eggs in one basket is riskier
When it comes to investing, majority of population directly think about returns and how much one can make by allocating their funds. However, the returns come hand in hand with another measure of investment performance – risk. While the returns are fairly easily observable, measuring risk can be more tricky and have multiple layers of how we can approach them. Continue reading Measuring Risk 101
In a world where investors are constantly looking for new ways to invest, structured products could be exactly what they are searching for. Whereas equities are usually tied to the performance of a company or index and bonds have specific rates at which they are paid out, structured products tend to have more flexibility in both their risk and return profiles. Continue reading What are Structured Products?
Generally, what comes to mind when we hear “financial funds” is money. While this is accurate, this term perfectly describes a “pool” of money. Usually, pooling money is a way to achieve a specific financial goal that is probably capital-intensive. … Continue reading What are Financial Funds?
Let’s have a look at one of the most interesting items of the accounting statements that is directly linked to all statements we have looked at (Balance Sheet, Income Statement, and Cash Statement). Pretty much every asset that we have … Continue reading What is depreciation?
Derivatives are often thought of as confusing and overly complicated. Simply put, it is a financial product that derives its price from the underlying assets, which can be stocks, bonds, commodities, exchange or interest rates, market indexes, and even other derivative instruments. Continue reading What are derivatives?
When considering investing, the return is as one of the most crucial factors the investors look at. It is not the most complex concept when we look at the value of a portfolio, however the calculations can become very intricate when we look at large, multi-asset class portfolios with transaction costs, cash flows, dividends and interest payments, and frequent rebalancing. Continue reading Measuring Returns 101
The balance sheet tells what a company owns and owes, the income statement tells us what a company earns and pays over the specific timespan. The cash statement uses all that information and explains where the actual money is in all that process. Continue reading Cash Statement and How it Links to Other Statements
The income statement looks at what the company earns and pays over the specific time span. Continue reading Income Statement: Yin and Yang of the company’s profits
While equities are the most visible asset class, the bonds are the most diverse. Typical company has one, few firms have a couple of equities share classes. The most notable examples are tech firms such as Alphabet and Facebook having … Continue reading What are bonds?
This is the asset class with the largest valuation globally. Equity represents an ownership of the company share. Essentially, the ownership of equity entitles you to receive the future incomes of the company and allows you to decide on the company’s behalf based on the stake owned. Continue reading What are equities?
The range of investment options is so broad that it might be overwhelming for a new person exploring their long- and short-term portfolio needs. Historically, the asset classes were equities, bonds, and cash, however, the present-day list can be expanded with alternatives (real estate, commodities, venture capital, direct private equity, and real estate. Continue reading ‘What are’ articles. Financial instruments’ variety
I have been learning finance and working in the industry for the past 11 years, and I must say there is nothing that brought me more joy than teaching others the basics of financial literacy. Our financial health is very … Continue reading Investing 101: What’s this blog about?
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