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Finance Investment Strategy Portfolio Management

Introduction to Asset Allocation – Part IV

Guest Post – Tanumoy Hazra Why is it so important to determine an Asset Allocation Strategy? Expanding Options: The array of alternate investment options are growing day by day for investors. While they certainly make the portfolio construction process more complicated, they also provide new corridors for increasing potential returns while managing risk. It becomes […]

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Finance Investment Strategy Portfolio Management

Introduction to Asset Allocation – Part III

Guest Post – Tanumoy Hazra Challenges of asset allocation execution: There are many challenges in executing an asset allocation. A few common ones have been outlined below: I) Costs & lock-ins: Some asset classes are available but their costs are very high. For instance: A private equity/real estate fund is available at fixed fee plus performance […]

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Finance Investment Strategy Portfolio Management

Introduction to Asset Allocation – Part II

Guest Post – Tanumoy Hazra Introduction The importance of asset allocation lies in the overall risk-return performance of your portfolio. Both asset allocation and rebalancing your portfolio when required, play an important part in having a well diversified and a disciplined investment approach. The number of benefits provided by these 2 relatively straightforward investment strategies is immense. […]

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Finance Investment Strategy Portfolio Management

Introduction to Asset Allocation – Part I

Guest Post – Tanumoy Hazra Introduction Asset Allocation is an investment process which aims at allocating capital in different assets classes (eg: stocks, bonds, cash, gold, etc) that helps in balancing the risk and returns in a portfolio in accordance to the investor’s goals, risk tolerance and investment horizon. Examples of types of Assets Stocks – […]

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Finance Investment Strategy Portfolio Management

The Law of All or Nothing

Introduction In probability theory, the Kolmogorov’s zero–one law, named in honour of Andrey Nikolaevich Kolmogorov (yeah, I couldn’t pronounce that either), specifies that a certain type of event, called a tail event, will either almost surely happen or almost surely not happen; that is, the probability of such an event occurring is zero or one. The significance of this law is more pronounced in […]

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Finance Investment Strategy Portfolio Management

Statistical Arbitrage

What is Statistical Arbitrage? This is one of the strategies employed by Hedge Funds and High Frequency Traders, wherein they profit from mispricings in the market. The core idea being, prices of financial securities revert to their long-term historical average value over time (mean-reversion). To shed more light, let’s quickly walk through the mechanics of […]

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Finance Portfolio Management

Portfolio Management Theories

Setting the context: In this article, let’s delve into the history of Portfolio Management. We will explore the different theories which etched their mark in the domain of portfolio management. Theory 1 – Dow Theory Charles Dow the ex-editor of the Wall Street Journal, presented his theory on the influences on Stock Market movements. His […]