Portfolio management is the process of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance. Portfolio managers are responsible for managing the investments of a portfolio. What does portfolio mean in technology? A portfolio in technology refers to a collection of products, … Read more
Active portfolio management is a strategy whereby an investor seeks to outperform a benchmark index by making active decisions about which securities to buy and sell. An active manager will typically have a large team of analysts and researchers who constantly monitor the market and make recommendations about which securities to buy and sell. The … Read more
The risk curve definition is a tool used by portfolio managers to help them understand and quantify the risk of their portfolios. The risk curve is a graphical representation of the risk of a portfolio, and can be used to help assess the risk/return trade-off of a portfolio. The risk curve is created by plotting … Read more
Heteroskedasticity is a statistical concept that describes a situation where the variance of a data set is not constant. This can happen for a variety of reasons, but usually occurs when the data is not evenly distributed. For example, let’s say you’re looking at the prices of houses in two different neighborhoods. In Neighborhood A, … Read more
Scenario analysis is a tool used by investors to understand how different events could affect their investment portfolios. By creating and analyzing different scenarios, investors can make better-informed decisions about how to protect and grow their assets. There are two main types of scenario analysis: 1. Stress testing 2. Sensitivity analysis Stress testing involves creating … Read more
A portfolio plan is a roadmap that guides the decision-making process for an organization’s portfolio of projects. The plan helps to ensure that the portfolio is aligned with the organization’s strategic objectives and that projects are selected and prioritized based on their expected contribution to those objectives. A portfolio plan typically includes a high-level overview … Read more
Risk measures are quantifications of the potential for loss in an investment, typically expressed as the probability of losing more than a certain amount of money over a specified time period. Common risk measures include value at risk (VaR) and expected shortfall (ES). Risk measures can be used to assess both the risk of an … Read more
CPPI is a portfolio insurance strategy in which an investor buys and holds a portfolio of investments, and periodically rebalances the portfolio to maintain a constant proportion of the portfolio in each investment. The strategy is designed to protect the portfolio from losses while still allowing the investor to participate in the upside potential of … Read more
A Martingale system is a system of money management in which the dollar value of a trader’s position is increased after a loss so that the first profit taken equals the total of all previous losses. The theory behind a Martingale system is that by increasing the size of the position after a loss, the … Read more
A paper millionaire is an investor who has a paper profit on their investment. This profit is not realized until the investment is sold. Paper millionaires are often associated with people who invest in stocks, but the term can apply to any investment. What are paper assets? Paper assets are any financial assets that are … Read more
