Blog Posts

Is it better to pick individual stocks or invest in index funds? Stock picking vs. indexing has been a classic investment debate over the past few decades. Mutual funds have been around for decades, providing broad exposure to lots of different stocks at a reasonable cost. In the 1990s, ETFs became more popular, which are […]

The concept of using a portfolio to live off dividends is considered by many to be the point at which they’ve officially “made it”. How can we turn this ideal of living off dividends into a safe and viable strategy? We’ll cover all of this in this article. Dividends and the basics of why we […]

Credit spreads are financial instruments that are used to speculatively trade credit risk. To go long credit spreads, this involves the simultaneous purchase of a high-yield credit instrument, such as a corporate bond or credit default swap (CDS), and the sale of a lower-yield credit instrument, such as a US Treasury security or CDS. Credit […]

Basis risk pertains to the risk that the basis, or the difference in price between two similar financial instruments, will change unexpectedly. This type of risk is often present when an investor is holding a position in one security while simultaneously trying to hedge against moves in another related security.   Conceptual Diagram of Basis […]

Interest rates play an important role in how a bank makes money. Interest rates influence a bank’s business both directly – i.e., driving loan, securities and deposit pricing and borrowing costs – and indirectly – i.e., impacting loan demand, default rates, and capital markets activity. Over the past more than four decades, interest rates have […]

Relative value is a concept that refers to the value of an asset in relation to the value of other assets. It is often used to compare the value of investments or to determine the fair value of an asset. In trading, relative value is used to identify opportunities to buy or sell assets based […]

Directional investment strategies are ways of trading or investing that involve taking a position in the market with the expectation that the price of an asset will move in a specific direction. There are two main types of directional investment strategies: bullish and bearish. Bullish investment strategies involve taking a long position in the market, […]

An index fund and ETF are often assumed to be the same thing. In some cases they are, but an index fund covers a wider array of investment products. Here we’ll look at their similarities and differences.   Key Takeaways – Index Fund vs. ETF Structure and Management: Index funds are generally used interchangably with […]

Terms of trade are a critical concept in international trade and currency trading.  The term refers to the ratio between a country’s export prices and its import prices, and it measures the relative performance of a country’s trade balance.  In other words, it shows the value a country receives for its exports compared to the […]

Global macro is an investment strategy that seeks to profit from changes in the global economy by taking positions in a wide range of financial instruments, including currencies, bonds, commodities, and equities. This approach is based on the study of national economies, fiscal and monetary policies, financial and economic history, geopolitics, and international relations, and […]