Investing in Economies: The Risk-Averse Investor
A risk-averse investor is looking for the least amount of volatility coupled with consistent gains. This means that this investor would prefer a very safe investment that returns a couple of percentage points per year over a very risky investment that could potentially return ten or twenty percent. Also, a risk-averse investor is looking to help balance any losses with gains in other sectors. This would help point to a preferred type of economy, out of the two listed that the investor has to choose from.
The second economy, where "stock returns are independent one stock increasing in price has no effect on the prices of other stocks" would be a better investment route for such an investor. This is not to say that the other option could not be lucrative, but in diversification, the portfolio is better balanced to absorb losses in one stock and gains in another. Also, as long as...
This was because they were seeing one of their primary competitors (Travelers) merging with Citicorp (which created a juggernaut of: insurance, banking and brokerage activities). At which point, executives at AIG felt that in order to: maintain their dominance in the industry and offer new products they should become involved in similar activities. The difference was that they would grow the company by expanding into areas that were considered
Commodity Investing Are there potential risk reduction and diversification opportunities in adding commodities to a Norwegian investor's asset portfolio? Recent global economic turmoil has inspired investors all over the globe to look for ways to protect their portfolios and to continue to make them grow despite a weak economy. Investments in commodities have been suggested as a solid hedge against future turmoil in the markets. The question is whether this is good
Investment Spending and Worker ProductivityThe economy of a country entails more than the sum of every individual�s economic status. In essence, a country�s economy is a collection of the transaction and values beyond a person�s actual cash in hand (Smyth, 2019). Investment spending and labor productivity are some of the factors that shape the economy of a country. An investment is a term used to refer to money or resources
Investments: Stock Selection On March 9, 2009 the stock market settled on a 12-year closing low with the Dow Jones Industrial Average (DJIA), a barometer of the economy and stock market trajectory, closing at 6,547.05. (Twin, A. March 9, 2009). The precipitous plunge for the DJIA from an "all-time high of 14,164.53" (Twin, A. October 9, 2007) reached on October 9, 2007 marked the timeline of the country's worst recession since
California Clinics To find out the stock's value with the information provided, the Gordon Growth Model would be used. The Gordon Growth Model is used to determine the price of a stock if the dividend, dividend growth rate and discount rate are all known. The underlying assumption behind the Gordon Growth Model is that the stock price is based on the expected future dividends -- investors are only investing for the
S., France and publicity, Chad was able to renegotiate more favorable contracts with the Bank, expropriate over $450 million in taxes from the private Consortium firms which they claim they had already paid, under the threat of replacement with Chinese firms. Global oil prices spiked, and Chad cleared over $1 billion in revenues in the last year of the Bank's project in 2008. Much of this increased income coincided at
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