Blog Posts

Comparable company analysis – also called “trading comps” or “comps” in finance lingo – is another business valuation method to choose from among discounted cash flow and precedent transactions modeling. (A leveraged buyout is also technically a valuation method as well but is more specialized toward private equity firms rather than investment banking.) It is […]

The yen is typically thought of as the most notable safe haven in the FX market. That’s one of the first things an FX trader learns about the market. There are a few main arguments why the Japanese yen is considered a safe haven: i) Japan has a positive net foreign asset position. This means […]

The volatility risk premium (VRP) pertains to the compensation traders earn from insuring against market losses. This typically involves selling options and/or other derivatives to other traders and investors to protect against the downside exposure they have in their portfolios. To incentivize traders to underwrite these products, options tend to trade at a premium over […]

We look into the determinants behind “risk-free” government bond yields. At its core, bond yields are shaped by a trio of elements: The prevailing short-term interest rate Anticipated future interest rates A term premium While sovereign credit risk plays a role in many nations, for the scope of this discussion, we’ll set it aside, focusing […]

A solvency ratio is an important financial metric used to measure a company’s ability to pay its long-term debts and is calculated by dividing the total assets of a business by its total liabilities. A ratio above 1 indicates that the company has more than enough assets to cover its liabilities, while a ratio below […]

What is real estate fintech? Real estate fintech refers to financial technology for the real estate sector. Fintech describes the new technologies, products, and services used to streamline the delivery of financial services. In other words, it’s using tech to make financial services more efficient, accessible, and user-friendly in the various ways possible. While fintech […]

Inflation dynamics aren’t likely to hold the trends that were prevalent in the 2010s, which has implications for bonds and other types of assets.  Why inflation is important and the impact on the bond market To understand how inflation is relevant to the investor or trader we must first understand what inflation means and its […]

In commodity markets, you often hear of what’s called a commodities supercycle. What is a supercycle? A commodities supercycle is considered to be a sustained period of increasing commodity demand, often for more than a decade. During this time commodities prices tend to rise, which can boost economic growth and development, especially among commodity exporters. […]

Financial markets come with lots of risks. Whether it’s debt crises or acts of nature, wars, and other events, traders are always thrown curveballs in one way or another. Many of these things come as a surprise because they haven’t happened during the time we’ve been trading and investing in the markets or because they haven’t […]

A currency defense is an economic policy implemented by a government in order to protect its currency’s value from speculators in the foreign exchange market. A currency defense can take many different forms, but typically involves intervention in the foreign exchange market to buy or sell the currency in order to keep its value within […]