July 2012 - Fundopedia

Behavioral Finance…

Investor Sentiment and Stock Return Anomalies

30 Jul 2012March 31, 2025

Investor sentiment refers to the propensity of individuals to trade on “noise” and emotions rather than fundamentals. As a contrarian stock market indicator, investor sentiment affects stock prices. Indicators that…

Behavioral Finance

Emotional Investing & Financial Emotional Intelligence

25 Jul 2012March 31, 2025

Conventional theories are grounded in the assumption that investors make rational decisions. Behavioral finance and emotional investing counter such notion by suggesting that emotions and gut reactions influence investment decisions…

Financial Modeling…

Portfolio Optimization, Risk Aversion, Constraints

21 Jul 2012March 31, 2025

Portfolio Optimization Since an investor can trade risk for return along the efficient frontier, the motivation of optimizing a portfolio originates from the idea that a greater expected return for…

Asset Allocation…

Risk Allocation, Asset Allocation, Tracking Error Allocation

17 Jul 2012March 31, 2025

Risk allocation emerged in the late 1900s, in response to concerns about the level of risk being accepted in a portfolio. The process involves setting up a plan for how…

Alternative Investments…

LIBOR-Fixing Scandal, Implications, and The Timeline

13 Jul 2012March 31, 2025

Essentials of LIBOR The London Interbank Offered Rate (LIBOR), is the average interest rate at which banks make short-term loans to one another. It is a borrowing rate set daily…

Financial Modeling…

Valuation Multiples, BtM, Tobin’s q, and EM

10 Jul 2012March 31, 2025

Empirical studies indicate that value stocks have beaten the market over the long run, which are characterized by low multiples: price-to-earnings (P/E), price-to-book (P/B), enterprise value (EV), earnings before interest,…

Fixed Income…

High Yield Fixed Income Searches

9 Jul 2012March 31, 2025

The 9 July 2012 issue of Pension & Investments mentioned that “institutional investors' overhaul of their fixed-income portfolios amid ever-lower interest rates and quantitative easing has fueled an exodus out…

Asset Allocation…

Negative Real Interest Rates & Endowment Investing

3 Jul 2012July 17, 2023

In the U.S., the real (i.e. inflation-adjusted) rate of return on almost all federal government bonds is negative; such downward trend in government yields is not a recent phenomenon. In…

Emerging Markets

The Three-Cycle Model and Asian Family Businesses

2 Jul 2012July 17, 2023

Family businesses are an important pillar of Asian economies, accounting for one third of total regional market capitalization. An emerging market study by Credit Suisse in later 2011 indicates that…