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Fundamental Analysis
Fundamental analysis, in accounting and finance, is the analysis of a business's financial statements (usually to analyze the business's assets, Liability (financial accounting), liabilities, and earnings); health; Competition, competitors and Market (economics), markets. It also considers the overall state of the economy and factors including interest rates, production, earnings, employment, GDP, housing, manufacturing and management. There are two basic approaches that can be used: bottom up analysis and top down analysis. These terms are used to distinguish such analysis from other types of investment analysis, such as technical analysis. Fundamental analysis is performed on historical and present data, but with the goal of making financial forecasts. There are several possible objectives: * to conduct a company stock valuation and predict its probable price evolution; * to make a projection on its business performance; * to evaluate its management and make internal business d ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Accounting
Accounting, also known as accountancy, is the process of recording and processing information about economic entity, economic entities, such as businesses and corporations. Accounting measures the results of an organization's economic activities and conveys this information to a variety of stakeholders, including investors, creditors, management, and Regulatory agency, regulators. Practitioners of accounting are known as accountants. The terms "accounting" and "financial reporting" are often used interchangeably. Accounting can be divided into several fields including financial accounting, management accounting, tax accounting and cost accounting. Financial accounting focuses on the reporting of an organization's financial information, including the preparation of financial statements, to the external users of the information, such as investors, regulators and suppliers. Management accounting focuses on the measurement, analysis and reporting of information for internal use by ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Efficient-market Hypothesis
The efficient-market hypothesis (EMH) is a hypothesis in financial economics that states that asset prices reflect all available information. A direct implication is that it is impossible to "beat the market" consistently on a risk-adjusted basis since market prices should only react to new information. Because the EMH is formulated in terms of risk adjustment, it only makes testable predictions when coupled with a particular model of risk. As a result, research in financial economics since at least the 1990s has focused on market anomalies, that is, deviations from specific models of risk. The idea that financial market returns are difficult to predict goes back to Bachelier, Mandelbrot, and Samuelson, but is closely associated with Eugene Fama, in part due to his influential 1970 review of the theoretical and empirical research. The EMH provides the basic logic for modern risk-based theories of asset prices, and frameworks such as consumption-based asset pricing and int ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Growth Stock
In finance, a growth stock is a stock of a company that generates substantial and sustainable positive cash flow and whose revenues and earnings are expected to increase at a faster rate than the average company within the same industry. A growth company typically has some sort of competitive advantage (a new product, a breakthrough patent, overseas expansion) that allows it to fend off competitors. Growth stocks usually pay smaller dividends, as the companies typically reinvest most retained earnings in capital-intensive projects. Criteria Analysts compute return on equity (ROE) by dividing a company's net income into average common equity. To be classified as a growth stock, analysts generally expect companies to achieve a 15 percent or higher return on equity. CAN SLIM is a method which identifies growth stocks and was created by William O'Neil a stock broker and publisher of '' Investor's Business Daily''. In academic finance, the Fama–French three-factor model relies on ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
McGraw-Hill
McGraw Hill is an American education science company that provides educational content, software, and services for students and educators across various levels—from K-12 to higher education and professional settings. They produce textbooks, digital learning tools, and adaptive technology to enhance learning experiences and outcomes. It is one of the "big three" educational publishers along with Houghton Mifflin Harcourt and Pearson Education. McGraw Hill also publishes reference and trade publications for the medical, business, and engineering professions. Formerly a division of The McGraw Hill Companies (later renamed McGraw Hill Financial, now S&P Global), McGraw Hill Education was divested and acquired by Apollo Global Management in March 2013 for $2.4 billion in cash. McGraw Hill was sold in 2021 to Platinum Equity for $4.5 billion. History McGraw Hill was founded in 1888, when James H. McGraw, co-founder of McGraw Hill, purchased the ''American Journal of Railway ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Contrarian Investing
Contrarian investing is an investment strategy that is characterized by purchasing and selling in contrast to the prevailing sentiment of the time. A contrarian believes that certain crowd behavior among investors can lead to exploitable mispricings in securities markets. For example, widespread pessimism about a stock can drive a price so low that it overstates the company's risks, and understates its prospects for returning to profitability. Identifying and purchasing such distressed stocks, and selling them after the company recovers, can lead to above-average gains. Conversely, widespread optimism can result in unjustifiably high valuations that will eventually lead to drops, when those high expectations do not pan out. Avoiding investments in over-hyped investments reduces the risk of such drops. These general principles can apply whether the investment in question is an individual stock, an industry sector, or an entire market or any other asset class. Some contrarians h ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Buy And Hold
Buy and hold, also called position trading, is an investment strategy whereby an investor buys financial assets or non-financial assets such as real estate, to hold them long term, with the goal of realizing price appreciation, despite volatility. This approach implies confidence that the value of the investments will be higher in the future. Investors must not be affected by recency bias, emotions, and must understand their propensity to risk aversion. Investors must buy financial instruments that they expect to appreciate in the long term. Buy and hold investors do not sell after a decline in value. They do not engage in market timing (i.e. selling a security with the goal of buying it again at a lower price) and do not believe in calendar effects such as Sell in May. Buy and hold is an example of passive management. It has been recommended by Warren Buffett, Jack Bogle, Burton Malkiel, John Templeton, Peter Lynch, and Benjamin Graham since, in the long run, there is a hi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Investor Profile
An investor profile or style defines an individual's preferences in investment decisions, for example: * Short-term trading ( active management) or long term holding ( buy and hold) * Risk-averse or risk tolerant / seeker * All classes of assets or just one (stocks for example) * Value stock, growth stocks, quality stocks, defensive or cyclical stocks... * Big cap or small cap ( Market capitalization) stocks, * Use or not of derivatives * Home turf or international diversification * Hands on, or via investment funds What determines an investor profile The style / profile is determined by Objective traits * Objective personal or social traits such as age, gender, income, wealth, family, tax situation, opportunities. Subjective attitudes * Subjective attitudes, linked to the temper (emotions) and the beliefs (cognition) of the investor. Balance between risk and return An investor's style is shaped by his or her sense of balance between risk and return. Some investors c ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Investment Management
Investment management (sometimes referred to more generally as financial asset management) is the professional asset management of various Security (finance), securities, including shareholdings, Bond (finance), bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be institutions, such as insurance companies, pension funds, corporations, charities, educational establishments, or private investors, either directly via investment contract, contracts/mandates or via collective investment schemes like mutual funds, exchange-traded funds, or REIT, Real estate investment trusts. The term ''investment management'' is often used to refer to the management of investment funds, most often specializing in private equity, private and public equity, real assets, alternative assets, and/or bonds. The more generic term ''asset management'' may refer to management of assets not necessarily primarily held for investment purpos ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Portfolio (finance)
In finance, a portfolio is a collection of investments. Definition The term "portfolio" refers to any combination of financial assets such as stocks, bonds and cash. Portfolios may be held by individual investors or managed by financial professionals, hedge funds, banks and other financial institutions. It is a generally accepted principle that a portfolio is designed according to the investor's risk tolerance, time frame and investment objectives. The monetary value of each asset may influence the risk/reward ratio of the portfolio. When determining asset allocation, the aim is to maximise the expected return and minimise the risk. This is an example of a multi-objective optimization problem: many efficient solutions are available and the preferred solution must be selected by considering a tradeoff between risk and return. In particular, a portfolio A is dominated by another portfolio A' if A' has a greater expected gain and a lesser risk than A. If no portfolio dominates A ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Behavioral Finance
Behavioral economics is the study of the psychological (e.g. cognitive, behavioral, affective, social) factors involved in the decisions of individuals or institutions, and how these decisions deviate from those implied by traditional economic theory. Behavioral economics is primarily concerned with the bounds of rationality of economic agents. Behavioral models typically integrate insights from psychology, neuroscience and microeconomic theory. Behavioral economics began as a distinct field of study in the 1970s and 1980s, but can be traced back to 18th-century economists, such as Adam Smith, who deliberated how the economic behavior of individuals could be influenced by their desires. The status of behavioral economics as a subfield of economics is a fairly recent development; the breakthroughs that laid the foundation for it were published through the last three decades of the 20th century. Behavioral economics is still growing as a field, being used increasingly in res ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market-based Valuation
A Market-based valuation is a form of stock valuation that refers to market indicators, also called extrinsic criteria (i.e. not related to economic fundamentals and account data, which are intrinsic criteria). Examples of market valuation methods Technical analysis Technical analysis is the most characteristic market-based method, although it focuses more on timing than pricing. Also, rough market comparison tools such as the PE ratio and the PEG ratio are used. More sophisticated forms of analysis (fundamental analysis, quantitative analysis, and behavioral analysis) use also some market criteria, such as the risk premium or beta coefficient. Those criteria might be "tilted" in some valuation models in anticipation of their possible variation in the next future, or to adapt them to their historical statistical range or mean. See also * List of valuation topics *Price discovery *Valuation using multiples In economics, valuation using multiples, or "relative valuation", is ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
