Systematic risk refers to the risk inherent to the entire market or market segment. Systematic risk, also known as “undiversifiable risk,” “volatility” or “market risk,” affects the overall market, not just a particular stock or industry. What is Systematic Risk? Systematic risk refers to that portion of total volatility in return on investment caused by factors […]
In finance and investment industries; correlation coefficient is a statistic that measures the degree to which two securities move in relation to each other. Correlations are used in advanced portfolio management and computed as the correlation coefficient; which has a value that must fall between -1.0 and +1.0. What is Correlation Coefficient? Correlation shows the strength of […]
Covariance calculates the directional relationship between two assets’ returns. A positive covariance means that the returns of assets move together while a negative covariance means that they move in the opposite direction. Key Notes: Covariance is a statistical tool that is used to determine the relationship between the movements of two random variables. When two […]
Systematic risk VS Unsystematic risk. Before knowing the key difference between systematic and unsystematic risk we must have some initial knowledge about these terms. What is Systematic Risk? Systematic risk can be defined as a type of total risk that arises as a result of various external factors such as political factors, economic factors, and […]
Lining vs Interlining. Lining and interlining are the most common words in garment manufacturing. We are going to focus on the key difference between lining and Interlining. The lining is constructed separately from the garment and attached at facing or hem areas by hand or machine. Interlining is a fabric added to a garment when […]
Open End VS Closed End Mutual Funds. Open-end and closed-end funds have a lot in common. They both typically exist as mutual funds, are professionally managed and can be used to build diversified portfolios. But there are some key differences between open-end and closed-end funds investors should be aware of. Key Features: Mutual funds are open-end […]
Before knowing the Types of Future Contracts; we must understand what a future contract actually is. A futures contract is a legal agreement to buy or sell a particular commodity asset, or security at a predetermined price at a specified time in the future. Futures contracts are standardized for quality and quantity to facilitate trading […]
In the financial sense, the capital market is the market for the instruments representing the long-term funds requirement of the corporation. It consists of a sprawling complex of institutions and mechanisms whereby intermediate-term funds and long-term funds are pooled and made available to businesses, governments, and individuals. In this mechanism outstanding instruments collecting the funds […]
Before knowing the Functions of Investment Banker; we must know who is an Investment Banker. Investment bankers are investment professionals who combine financial services industry expertise, analytical prowess; and effective persuasive communication skills to support institutional clients in activities like capital raising and mergers and acquisitions. Investment bankers lend their corporate finance services to clientele […]
OTC Market/ Over-the-counter market is an important alternative to the organized stock exchange and is measured in terms of the total volume of trading. It is a telephone- and computer-linked network of dealers who trade over the telephone. Key Points: Over-the-counter markets are those in which participants trade directly between two parties, without the use […]
