Hedge funds are financial partnerships that use pooled funds and employ different strategies to earn the highest possible returns for their investors. They are run by a fund manager, also known as the general partner, whose job is to maximize returns and eliminate risk as much as possible. Hedge funds are considered to be more […]
Inflation (the increase in prices and decrease in purchasing power; how much a dollar is worth) is widely known to be the scourge of savers, retirees, and workers, notorious for obliterating savings and piling up debt. But inflation’s lesser-known cousin poses an even greater risk to economies: deflation. Today, we’ll take a look at deflation […]
It has become increasingly essential that we put aside money each year to save for healthcare. Today, we’ll go through two of the most popular tax-deductible healthcare plans: the HSA and FSA. Benefits of a Tax-deductible Healthcare Account Healthcare is an essential component of being able to live a worry-free life, as they can help […]
One of the most famous ratios used by value investors is the EV/EBITDA ratio, or the Enterprise Value to Earnings Before Interest, Tax, Depreciation, and Amortization ratio. Value investors use it to evaluate a company. The EV/EBITDA ratio is used with or instead of the P/E ratio. Let’s break down this ratio into two parts: […]
Over the past decade, technology and automation have disrupted many industries, from automotives to manufacturing. Recently, it has made its presence known in the wealth management industry, with the rise of automated money management. Allow me to introduce automated money management (AMM), an industry on the cutting edge of financial planning and the future. AMM […]
After the end of World War II, the world was in tatters. The war had severely damaged all of Europe, who needed to rebuild. As they recuperated, the US began to take charge of creating the new world order. Amidst this change, a new international economic system was necessary in order to foster a new […]
I predict that in the not-too-distant future, the term “behavioral finance” will be correctly viewed as a redundant phrase. What other kind of finance is there? Richard Thaler, Founding Father of Behavioral Finance Investors often make irrational choices when managing their portfolio investments. Such choices are fueled by an array of fears that the human […]
What do going to the movies, chess, rock-paper-scissors, football, and international trade have in common? The answer is game theory. What many people may view as normal occurrences may in fact be part of an intricate web of decision-making from many people. Most people associate game theory with the Prisoner’s dilemma or the Nash equilibrium. […]
Dumping is one of the most frequent economic occurrences. Dumping occurs when one company prices its goods in market A below the value it charges in market B. With dumping, this company, in turn, is able to undercut competitors in A and increase its market share. Dumping is important to understand as it surfaces in […]
After the introduction of subprime mortgage-backed securities, investors were throwing their money into the U.S. housing market and housing prices began to rise. The newly relaxed lending regulations and low interest rates drove housing prices higher, making the MBS and CDO seem like even better investments. They figured that even if the borrower defaulted on […]