Stock Trading News

The Brownian model of financial markets is a mathematical model used to describe the random motion of asset prices. It is based on the Brownian motion concept, which was originally observed in the erratic movement of pollen particles in water. In the context of financial markets, this model helps in understanding the nature of asset […]

Econophysics is an interdisciplinary field that bridges the gap between physics and economics. It employs methods and models from statistical physics to study economic systems. The primary goal is to understand the complex dynamics of financial markets and predict their behavior. Physics is traditionally more mathematically rigorous than economics, and trading algorithms are fundamentally based […]

Tail risk hedging and tail risk protection strategies help mitigate the risk of substantial drawdowns in a portfolio. How do investors protect against these potential price falls? Whether it’s a rapid 20% loss in a month or a gradual decline over a year, the timing and duration of these drawdowns can drastically affect long-term gains. […]

The pension plan and 401(k) are two retirement savings options that serve as pillars of financial preparedness for life after work, each offering distinct benefits and considerations. While both aim to provide financial stability during retirement, understanding the key differences between them is essential for making informed decisions that align with your unique financial goals. […]

The financial markets are filled with various kinds of trades and investment options and each of these comes with different levels of risk and reward. To make informed trading or investment decisions, it’s vital to have a means of assessing the performance of various financial assets. Here we’ll look at a number of performance measurements […]

Post-Modern Portfolio Theory (PMPT) emerged as a response to the limitations and criticisms of Modern Portfolio Theory (MPT), which has been the cornerstone of portfolio management since its introduction by Harry Markowitz in the 1950s. MPT focuses on optimizing risk and return through diversification and asset allocation based on historical data. However, PMPT brings new […]

A portfolio is a collection of financial investments like stocks, bonds, cash equivalents, fund units, etc., held by investment companies, hedge funds, or individual investors. The concept of a portfolio stems from the theory of diversification, which proposes that a trader/investor can reduce risk by putting their funds in different kinds of investments/trades/returns streams.   […]

Determining the true value of a company is not always straightforward. Beyond the mainstream methodologies are various unique approaches to valuation, each offering a distinct perspective on a company’s worth. We look at techniques that may not be as widely recognized, but are equally viable in the right context and application. From the classic fundamentals-based […]

Relative valuation, also known as comparable valuation, is a method used to determine the value of different assets including bonds, real estate, and equities. This technique involves comparing the asset in question with other similar assets to derive its value. Let’s look into how relative valuation is applied across different asset types.   Key Takeaways […]

Determining the value in markets is an important part of investing and trading. To understand how to determine value, we’ll cover several key concepts and principles, including fair value, intrinsic value, market price, expected value, opportunity cost, and risk premium. These concepts will then be framed in the context of valuation risk, real versus nominal […]