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Investing in Russia
Investing in Russia has gotten really widely promoted for the last period. I can remember the talks that stocks in Russia are the cheapest over the world for not less than year. The fact, that those stocks are st
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What to Do With Investments in Current Turbulence?
The question is really not an easy one. The problem is that there is no left any good investments on this world. Let’s looks at the most topical investments classes: Stocks. Even before
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What means long term in investing?
When I talk to non-professional investors, I often get surprised on their interpretation of ‘long-term investment’. Of course, everyone wants to enjoy their lives and to do it fast, while not many are ready t
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How Investment Horizon Affects Your investment portfolio?
All investors have an investment horizon, which is the amount of time that they're willing to keep their money on the market. In layman's terms, it measures how long one is willing to wait before selling one's securiti
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Investments
(Are you looking for investment definition?) Investments are instruments that allow us to receive a higher amount of money than was spent. If someone spends 10 euros or dollars and he knows that he will receive
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Sortino Ratio
Sortino ratio is a financial ratio that is used to measure the performance of investment portfolio and is very similar to a Sharpe ratio. The main difference between Sortino ratio and Sharpe ratio is that Sharpe
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Derivatives
Derivative Financial Instruments Derivatives are so called because they are constructed from other traditional securities, and operate the rights to them. Apart from the fact that there are some basic derivative instrum
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Investing Top 10
INVESTING 10 things that you should try to do: Always have an investment strategy and follow it strictly. Set up an investment strategy (investing rules) even before beginning of investing: t
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Investing 10 NOT
INVESTING 10 things that you should try NOT to do: Do not let the emotions to take over control. The investment market is always full of emotions. It is very important to maintain sanity and
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Investment in Cash
Bank (saving) Accounts, Deposits, Deposit Certificates, Treasure Bills, Money Market Funds When we are talking about investment, cash is not only the real paper (or metal) money that are held in the wallet or under the
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Investment in Mutual Funds
Investment Funds (Collective Investment) Investment in mutual funds is one of the most popular types of investment. A mutual fund is just a large and well diversified investment portfolio of many securities, in which ca
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Investment in Forwards
Forwards – derivative financial instruments almost identical to the future contracts. This contract represents the parties committed to sell and buy the object at the predetermined time and price.Difference between
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Investment in Swaps
Swaps - an investment tool used rarely at investing process. Typically, these contracts are used by financial institutions or other big companies in order to exchange cash flows in different currencies. In fact,
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Strategy Investment
Strategy investment refers to an investment strategy, which should be wise chosen according to investing person character and market environment. Investing always has to be strategic and foresee possible future e
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Investing in Unprofitable Companies
Investment Strategy - Unprofitable Companies Investing in companies that are still unprofitable is more difficult than investing in profitable companies, but may also be very successful. If the company will turn around
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Investing in Funds
Investment Funds Strategy Indeed, investing in mutual funds is not complete investment strategy, but only a part of it, or more precisely, only the choice of investment instrument. For example, if the strategy d
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Investment Objectives for Beginners
The full investment objectives for beginners are very individual parameters. They were already mentioned briefly in article about benefits of investment. However, the basic investment objective is one - to make capital w
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Finance Management
Financial management, asset management, investment management, wealth management in fact are similar processes only called in different names. An investments definition may include both financial assets and real
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Investment Strategy by Age
It is very popular to allocate asset classes in investment portfolio according to investor’s age. And it has some reasonable justification: when investor’s age is changing – his risk tolerance a
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Investment Book:
Investing for Beginners Exposed: Or What Investment Consultants Hide from You Rokas Lukosius (Author of the book and this website) No matter whether you are a seasoned inv
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Investment in Short ETF
Investment in Short ETF is very different from regular investing. “Short” – means short selling transactions when securities are loaned and sold with obligation to return it after some pre-agree
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Dividend Stocks
Dividend stocks are called stocks that have high dividend yield and high dividend payout ratio. Normal dividend stocks should have stable 6%-10% dividend yield and possible 60-100% dividend payout ratio. High div
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Investment Tactics
Investment tactics are the rules for investment actions that help to react on market conditions and achieve more efficient results. Investment tactics deal with lower scale questions than investment strategy, whi
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investment portfolio
An investment portfolio is a composition of different investments made on purpose to achieve the highest return at predetermined risk level. investment portfolio can include all kinds of investments: stocks,
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Global Investment
Global investment is investment that includes investments from different world’s regions. Investment can be local, regional or global. Local investment would focus on one country or state market, when regio
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International Investment
International investment is investment that includes investments from different countries. If investor acquires investments in several countries, we could call him international investor. If investment portfolio
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Diversified Investments
Diversified investments are investments that are well diversified, which should include regional diversification, allocation between asset classes, sectors, maturity, denomination of currencies and other characte
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Diversification
A diversification is an investment technique or a part of an investment strategy, which is used to reduce the investment risk of the portfolio, including in it larger number of different securities or other inves
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Mutual Fund
A mutual fund is a collective investment vehicle that is consisted of fund units, which are sold for retail investors. Practically, mutual fund is a large investment portfolio, in which can take a part even small
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Hedge (Hedging)
Hedge (hedging) is protection of investment portfolio against fluctuations using financial instruments. Hedge is very popular at investment theory, but not so popular at investment practice. In theory everything
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Investment Bank
An investment bank is a financial institution that has a license of bank and specializes exclusively on investment services. In the USA investment banking services was separated from other banking activity u
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Brokerage Company
A Brokerage Company is a financial institution that has a license to provide intermediary services for a securities trading to the clients. Every retail client cannot by securities on stock exchange by himself be
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Investment Management Company
An investment Management Company or Asset Management Company is a firm that has a license and provides investment management services. Such management company can manage private investment portfolios, invest
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Investment Consultant
An investment consultant is a job position in financial companies. Main functions of investment consultant: Help private investors to make a proper investment strategy according to investors risk tolerance. A
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Diversifiable Risk
A diversifiable risk is the risk that can be reduced by increasing number of investments in the investment portfolio. For example, company’s risk can easy diversifiable by choosing more companies. Even coun
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Investment Strategies
Investment (investing) strategy – often discussed by both amateur and professional investors, but in fact very rarely encountered. Amateurs usually imagine that they has an investment strategy only after th
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Financial Leverage
A financial leverage is a use of borrowed money to achieve more efficient capital structure. A borrowed capital is cheaper than equity capital most of the times. So usage of loaned money makes weighted average ca
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Investment Management Fees
Investment management fees (fees that are paid straight to investment manager) basically are one of these types: Performance based fee. Performance based fee is calculated according to increase of inve
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INVESTMENT MANAGEMENT HOW TO MANAGE YOURS INVESTMENTS PROPERLY
Investment management is a complete science and if you are expecting to become a professional investment manager in few hours you should get disappointed. However, there are several most important guidelines at i
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Investment Performance Measurement
Many investors are happy about investment managers until the stock market is growing, but when the decline starts investment managers gets only the worst words about their job. However, this is wrong attitud
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Treynor Ratio
Treynor ratio is another popular ratio that is used to measure the performance of investment portfolio. This ratio compares the excess return (above risk free return) of a portfolio to beta of that portfolio. Whi
http://www.investingforbeginners.eu/treynor_ratio
Jensens Alpha
Jensen’s alpha is used to measure the performance of an investment portfolio. The higher ratio means better performance of portfolio manager. Basically, this Jensen’s ratio shows the above market port
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Investment Risk Management
There are several main methods of investment risk management: Diversification. Diversification is the easiest and most of the times the cheapest way to reduce risk level of the investment portfol
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Sharpe Ratio
Sharpe ratio measures the above risk free performance of investment portfolio in relation to its risk. This ratio was developed by William F. Sharpe which introduced the ratio in 1966. Now Sharpe ratio is the mos
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Return on Investment
Return on investment (ROI) is a percentage that shows profitability of an investment or investment portfolio. Return on investment calculation: CALCULATION: Return on investment = net in
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Margin Trading
Margin trading is trading in securities when part of the investment portfolio is financed by borrowed money (the other part by your own capital). For example, you have investment portfolio of value $20k, end you
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Relative Valuation
Comparative analysis Relative valuation is stock valuation method that gained its popularity because of simplicity and practical importance. The key principle of relative valuation is about valuation multi
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Correlation
Correlation is a statistical measure that shows the relationship between two objects. Correlation may range between +1 and -1. If correlation between the objects is 0 that means they are not dependable on each ot
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Power of Compounding
Power of compounding (compound interest) is a known description for fast increase in value when investment brings steady interests and interests are reinvested. The principle of the growth is the geometric progre
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Margin Call
Buying on Margin Costs of Buying Stocks on Margin Margin Call The Pros and Cons Psychology: Is it worth? Margin call is a fabulous term which carries some mysticism. However, there is nothing
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The Pros and Cons of Buying on Margin
Buying on Margin Costs of Buying Stocks on Margin Margin Call The Pros and Cons of Buying on Margin Psychology of Buying on Margin: Is it worth? The opportunity provided by buying on margin i
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Psychology of Buying on Margin: Is it worth?
Buying on Margin Costs of Buying Stocks on Margin Margin Call The Pros and Cons of Buying on Margin Psychology of Buying on Margin: Is it worth? For the conclusion I would like to say that bu
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Margin Calls
Margin call is a call by margin trading service provider to an investor who is buying on margin. Such calls are provided when assets (collateral) in the investment portfolio are losing value and reach the margin. Margin
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No-Load Fund
No-Load fund is a fund that does not have a load fee which is paid by investor that acquires the mutual fund. There are two types of load fees: front-end load and back-end load, and ‘no-load fund’ sho
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Performance Based Compensation
Performance based compensation is a form of compensation for the investment management work depending on quality of results. Performance base compensation is very common in investment management industry and help
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Fund Manager
A fund manager is an employee of investment management company which is responsible for the management of the fund’s assets. Most of the times, more than one person is involved in fund’s management bu
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Portfolio Manager
A portfolio manager is an investment professional that takes over the management of an investment portfolio. There are many types of managed investment portfolios: mutual funds, pension funds, insurance funds, po
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Index Options
Index options are derivative financial instruments that provide for the buyer of the option the right (possibility) to make profits from index value changes. It may be a good investing instrument for the investor
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Investment Fund Management
Investment fund management is not much different from simply investment management or asset management. Investment fund is large investment portfolio and the composition of that portfolio depends on particular fu
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Investment Management System
It is common to understand an investment management system as investment management software that helps in investment portfolio management. While other people believe that investment management system should do t
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Investment Management Business
Investment management business is a large part of a financial industry and is very important for investment banks and other investment companies because investment management business has quite good profitability
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Stocks and Commodities
You may ask how stocks and commodities related are. And the answer is simple: everything is related and especially in financial markets. Normally, if some of the main asset class (as stocks) looses or gains
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Rate of Return
A rate of return is a percentage that shows what is the profit or loss gained on some investment on annual basis. There are many ways to calculate the rate of return including internal rate of return, arithmetica
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Financial Ratios
Financial ratios are ratios that are used in financial analysis or in other words that are using financial data of a company. Such financial data usually is found in financial statements (income statement, balanc
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Leverage
Leverage definition In finance leverage means usage of debt capital in addition to the equity capital in order to increase the profit. Increase in leverage is understood as increase in riskiness and volatility.
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