Steps to Maximize Portfolio Performance

Almost anyone who has investments is likely to review their investments periodically. This ensures that the investments remain diversified. Informed and veteran investors understand the diversification types and that they should be considered. The investors’ geographies...

How to Use Expected Return, Variance, and Standard Deviation in Stock Investing

The expected return of an investment portfolio is computed as the weighted average of the assets’ probable profits, weighted by the possible returns of every asset class. The formula used in calculating its value is E(R) = w1R1 + w2Rq + …+ wnRn. For instance, there is a...

Why Use Statistical Indicators to Identify Economy and Financial Trends?

Statistics used to quantify the current conditions, economic trends, and financial forecasts are called indicators. The statistical metrics used to measure the economy’s contraction or expansion are called as economic indicators. Technical indicators are utilized to forecast...

What Is a Recognition Lag as an Economic Indicator?

The time between an actual economic shock and when it was determined by central bankers, economists, and the government is called recognition lag. An economic shock could be represented by a bust or abrupt rumble. It is evaluated alongside response and implementation lags, which...

Why Cash Flow Ratios Could Be Better Than Price-to-Earnings Ratio?

Some consider cash flow ratios as better metrics for valuing stocks compared to price-to-earnings ratio or P/E. One of the most important bases to specify a stock’s value is the amount of cash a firm could generate. However, you would still hear more about P/E than any probable...

Why Use the Relative Strength Index (RSI) in Stock Trading?

Analyst Welles Wilder developed a momentum indicator called the Relative Strength Index (RSI). It is used to make a comparison between the recent gains and losses’ magnitude over a certain period of time. RSI is utilized to determine the security price movement speed and...

What Is the Role of the Overall Liquidity Ratio in Fundamental Analysis?

Overall liquidity ratio is the measurement of a company’s ability to pay for its liabilities with its current assets. The calculation of the ratio is done by dividing total assets by the total liabilities and conditional reserves difference. The metric is utilized in the analysis...

Difference Between an Initial Public Offering and a Follow-On Offering

An Initial Public Offering (IPO) is the first time a company offers its stocks to the public. This is usually issued by smaller and maiden companies looking for expansion. Possibly, after an IPO, a Follow-On Offering (FOO) could take place. It could either be diluted or...

Why You Should Use Volume in Technical Analysis?

Volume analysis is necessary for technical analysis. Volume is defined as the number of contracts or shares that trade over a certain period of time. The higher the volume there is, the security shows more activeness. To specify the volume’s movement, either up or down, technical...

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