Blog Posts

Auto-callables are complex savings instruments that offer a bond-like fixed return, crafted by selling stock options.   Key Takeaways – Auto-Callables Auto-callables are savings instruments that offer fixed returns similar to bonds, created by selling stock options, primarily on broad stock market indices. They attract investors with their potential for higher yields and early redemption […]

In international investment, currency risk is a significant concern, which leads to the concept of FX hedging. When investors from one country, such as Japan, buy foreign bonds, they must exchange their domestic currency (JPY) for another (such as USD or EUR). This exposes them to foreign exchange (FX) risk, which many prefer to avoid. […]

Quantum algorithms promise to deliver faster and more accurate solutions to financial optimization problems. We look at quantum algorithms and their application in various financial optimization problems and their edge over classical algorithms.   Key Takeaways – Quantum Algorithms in Financial Optimization Problems Quantum algorithms leverage quantum superposition and interference to provide faster and more […]

Quantum Game Theory is an extension of classical game theory, which incorporates the principles of quantum mechanics. Classical game theory has been a cornerstone in economic and social sciences. The quantum version of game theory offers a different perspective, especially when it comes to understanding complex financial systems.   Key Takeaways – Quantum Game Theory […]

Market microstructure refers to the study of how trading mechanisms, rules, and protocols, as well as the actions of market participants, influence the formation of asset prices, trading volume, and trading behavior. Algorithmic trading involves using computer algorithms to automatically make trading decisions, submit orders, and manage those orders after submission. Understanding the various intricacies, […]

The economic case for Saudi Arabia’s investment in sports teams and stars can be analyzed from various angles. Saudi Arabia’s investment in sports teams has drawn widespread skepticism because sports teams usually aren’t the most profitable investments – even among famous teams in countries with a long history and media coverage of the sport. However, […]

Foreign bonds are instruments that are much more complex to trade or invest in than domestic bonds. There’s a lot to them that doesn’t meet the eye at first. For example, when amateur traders and investors decide to buy a foreign bond, what’s going to be the one thing they hyper-focus on? The nominal yield. […]

Several companies have dual or multiple share classes. Here are some notable examples: GOOG vs. GOOGL Alphabet Inc. (formerly Google Inc.) has two publicly traded share classes. GOOG represents Class C shares (no voting rights), while GOOGL represents Class A shares (one vote per share). BRK.A vs. BRK.B Berkshire Hathaway Inc. has two share classes. […]

Hedge funds and private equity firms have considerable influence on the dynamics of capital allocation. The question of whether they create economic value is a topic of debate among industry experts and the broader public. Here we look at the hedge fund and private equity industry and its role in creating economic value.   Key […]

In hedge funds, various lesser-known strategies are employed to amplify returns and mitigate risks. We look through them below.   Key Takeaways – Little-Known Strategies Hedge Funds Use to Juice Returns Some examples of little-known strategies hedge funds use to juice their returns: Offshore Fund Structure Transfer Pricing Debt Financing Reinsurance Business Variable Annuities Risk […]