Author: Wealthy

How to overcome your financial problems

You are not the first to face your financial problems and you will not be the last. Financial problems can be of 2 types: Your situation Take your time. Breathe. Sit down, set aside a few hours and start your financial self-assessment. Understand and quantify your assets (home, bank accounts, stocks / securities, etc …) […]

Market efficiency & financial crisis

We can summarize the market efficiency concept with the following epigram: “Prices reflect all available information.” A market is efficient if all investors know the same information and if the information are relevant to determine the value of a company. Efficiency Definition Fama, the same of the previous post, in 1965 defines 3 forms of […]

Correlation and Diversification

Uncorrelated assets lower the investment risk. Let’s see what correlation and diversification mean for a moment. Correlation between 2 assets In finance, correlation is the relationship with which 2 investment instruments move. The correlation varies between +1 and -1.+1 means that the instruments move in the same way.-1 means that the instruments goes in exactly […]

Risk and Investment Funds

Put money into investment funds reduces the risk, Always. Why? Let’s look at the types of risks involved in investing in an asset and why diversification helps. Risk Risk refers to the possibility that the actual return of an investment differs from its expected return. There are two types: The risk premium for diversifiable risk is […]