Articles on Stock markets
News, Research and Analysis
What is market risk?
Market risk is the chance that an investment will not maintain its value when it is dependent on the many factors that influence the health of the economy and the stock market. Investors must be aware that investing money in a stock or mutual fund is to tie the fate of that money to the fate of the company or companies that they have invested in.
The other side of the coin, of course, is the potential for gains. The potential gains of an investment are the premium that is paid to an investor in exchange for allowing a company or mutual fund to take risks with the investor’s money.
They say that the riskier the investment, the higher the potential reward, but this may or may not hold true in all situations. Ideally, an investor would diversify his or her portfolio to an extent that risk was minimized for the amount of gain sought, and this is the foundation of modern portfolio theory.
Looking to bonds for an example of risk premium, a bond will have to pay a higher yield if investors perceive that there is more risk involved. The risk-less Treasury bonds will pay the lowest yield because their value is mostly in their safety.
A similar equation holds true in the futures and options market. Investors who seek high returns must be willing to assume higher risk, in general. Even with fully diversified portfolios, systematic market risk will expose investors to random price fluctuations, due to the inherent randomness and volatility of the market.
What is Risk?
What is the Risk/Return Trade-Off?
What is the ‘Risk-Free Rate of Return’?
How volatile are commodities?
Commodities are more volatile than most assets. The supply-demand dynamics of commodities are continuously changing rapidly
Where Should I Open an IRA?
It is completely your choice! IRAs can be opened at almost any large bank or brokerage firm, giving you plenty of options
What if My Long-Term Care Insurance Doesn’t Pay for My Expenses?
Most long-term care insurance policies are designed to mitigate the cost of long-term assisted living care, not to...
Where Should I Put my Healthcare Savings?
Saving for health care needs should be a lifelong pursuit. You can use brokerage accounts and HSAs to accomplish your...
What Can You Buy with Bitcoin?
With every day that passes, bitcoin is becoming a more usable and accepted form of payment for a variety of goods and services
What are Net Tangible Assets?
Net Tangible Assets represent a company’s total amount of physical assets less its intangible assets
What is Economies of Scale?
Economies of Scale is a concept that the efficiency of production rises as the quantity of goods produced increases
What is a currency symbol?
Currency symbols are characters written or typed in a specific arrangement alongside the numerical values of a currency
What are Financials Stocks?
Financial stocks are those that make up the financial sector, which encompasses banks, lenders, wire houses, and others
What was the Worst Day for the Markets?
The worst day for the markets, in terms of the largest single-day point loss by the Dow Jones, was September 29th, 2008