What is Modern Portfolio Theory
What is Modern Portfolio Theory?
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In 1952 the Modern Portfolio Theory (MPT) of Harry Markowitz introduced the analysis of portfolios of investments by in view of the expected return and risk of individual assets and crucially, their inter-relationship as measured by correlation. Previous to this investors would study investments individually, increase portfolios of favoured stocks, and not see how they associated to each other. In Modern Portfolio Theory diversi?cation plays an significant role.
We focus more on cash flows rather than profits when estimating proposed capital budgeting projects. Explain.
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Illustrates the basic operation of a currency futures market.A futures contract is an exchange-traded instrument along with standardized features demonstrating contract size & delivery date. Futures contracts are marked-to-market day by day
The discussion of zero-coupon bonds in the text gave an instance of two zero-coupon bonds issued through Commerzbank. The DM300, 000,000 issues due in the year of 1995 sold at 50 percent of face value and the DM300, 000,000 due in the year of 2000 sold a
What is Speed in option value?
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