Financial Theory Articles

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  1. The Rewards Of Trading Stocks With Low Volume

    Trading in stocks which have low volume is risky, but it does offer a lot of high return potential. Investopedia explains ...
  2. What To Do With Stocks That Hit All-Time Highs

    Apply this specialized set of risk management and technical rules when your positions are trading at new highs.
  3. Market Crisis: Does Diversification Still Work?

    If you still aren’t sold on the benefits of international diversification, you may object that: Diversification didn’t work ...
  4. The Risks & Rewards of Penny Stocks

    Penny stocks can make you a lot of money in a short period of time, but this is a very dangerous game that almost always ...
  5. Feeling Risk-Averse? Consider These Investments

    These investments offer risk-averse investors resiliency to bear markets while paying sustainable dividends or interest. ...
  6. Investing: How to Make Fast Money in Your 20s

    In your 20s and want to maximize returns on your investments? Here's how. But be careful.
  7. Should You Average Down When Trading Stocks?

    Averaging down on a stock can allow you to avoid having to admit you are wrong. On top of this and given enough time, the ...
  8. Why Risk-Free Investments Don't Exist

    We explain the risks inherent with all types of investments and why risk-free investments do not exist.
  9. How Safe Are Gold And Silver Investments?

    Contrary to both tradition and popular opinion, gold and silver may not be the best hedges against inflation nor the safest ...
  10. How To Calculate Beta Of A Private Company

    We explain two methods for calculating the beta of a private company.
  11. Should You Bet on These 5 Inverse Oil ETFs?

    While these oil inverse ETFs can make a lot of fast money, investors need to proceed with caution.
  12. Should Bet on This Top Gaming ETF?

    BJK has been performing well, but is this just a blip in an otherwise bear market for gaming companies?
  13. Leveraged S&P 500 ETFs: Are These the Best?

    A look at the top six S&P 500 leveraged ETFs.
  14. Penny Stocks that Had Potential But Failed

    Welcome to the wild world of penny stocks. Here's what to expect.
  15. Are These 3 Agricultural ETFs, ETNs a Good Bet?

    Three top tier agriculture ETFs and ETNs to consider when the time is right.
  16. Are These 3 Alternative Energy ETFs Good Bets?

    Eyeing alternative energy? Consider these three ETFs to gain exposure.
  17. The Risks Of Writing Covered Calls

    While writing a covered call option is less risky than writing a naked call option, the strategy is not entirely riskfree.
  18. Market Timing Tips & Rules You Should Know

    Market timing rules benefit investments by finding the best prices and times to take exposure and book profits.
  19. Value Investing & Short Selling Are Like Oil & Water

    To be a good value investor, you need to find and buy bargain stocks but more importantly, you have to stick to the trade ...
  20. Trading Risks And Rewards In Your Favor

    Measure reward and risk targets before taking a trade, and let those numbers guide your open position.
  21. Writing Covered Calls On Dividend Stocks

    Writing covered calls on stocks that pay above-average dividends is a strategy that can be used to boost returns on a portfolio, ...
  22. REITs 101: How They're Regulated

    Here's everything you need to know about REITs in less than five minutes.
  23. Oil vs. Gas ETFs: Which One Should I Choose?

    When it comes to oil versus gas ETFs, why not choose one that gives exposure to both?
  24. Understand The Math Behind Betting Odds & Gambling

    A betting opportunity should be considered valuable if the probability assessed for an outcome is higher than the implied ...
  25. The Top 3 Silver ETFs

    Like any tradable asset, silver and silver ETF prices are governed by the fundamental market economic forces of supply and ...
  26. Betting Basics: Fractional, Decimal & American Odds

    Betting odds are expressed in three popular formats: Fractional (British), Decimal (European) and American (Moneyline). So, ...
  27. Manage Investments And Modern Portfolio Theory

    Modern Portfolio Theory suggests a static allocation which could be detrimental in declining markets, making it necessary ...
  28. The UNG Natural Gas ETF: Best Bet or Stay Clear?

    UNG is a popular natural gas ETF, but if you're going to get involved, then you need to know the risks.
  29. Are Low-Risk High-Yield Investments Real?

    Risk and reward necessarily move in the same direction. Or do they? Is it possible to defy logic and earn great returns while ...
  30. Investing in Starbucks: Stock vs. Franchise

    A look at the pros and cons of investing in Starbucks stock or a franchise.
  31. The 10 Biggest REITs in the U.S.: Dos and Don'ts

    Five of these REITs may offer potential over the next 1-3 years. Be careful with the other half.
  32. Investing In Crisis, A High Risk-High Reward Strategy

    The financial crisis of 2008 and the great recession that followed is still fresh in the memories of many investors.
  33. The Risk And Rewards Of Investing In Startups

    Investing in startups is a very risky business but can reward investors greatly if and when they do pay off.
  34. Where To Search For Yield Today

    It’s hard to miss that there has been a pronounced slowdown in the U.S. economy this year.
  35. Use These ETFs to Trade Google

    If you want exposure to Google with diversification, consider the following ETFs.
  36. Buy Stock With Insiders: How To Track Insider Buying

    Insider buying can be a sign that a company's stock prices will soon rise. Here's how to keep track of insider buying on ...
  37. A Look at EAFE Index (EFA) ETF

    The iShares MSCI EAFE is a unique ETF with exposure to high quality companies, but is it likely to be a good bet going forward? ...
  38. The Biggest Threats to Netflix

    A look at the biggest threats to Netflix and whether it can maintain its current growth rate.
  39. Is this ETF Your Best Bet for Emerging Markets?

    Are emerging markets still emerging? If you believe so, this ETF could be your best bet.
  40. At Look at REITS vs. Real Estate Mutual Funds

    REITs and real estate mutual funds have their differences, but they both offer liquidity and easy access to diversified real ...
  41. Why 'Menu' is a 4-Letter Word at McDonald's

    McDonald's has taken care of its shareholders through the years, but the brand has suffered recently. What is likely to happen ...
  42. How to Manage Risk in Your Personal Portfolio

    To best manage your portfolio, first determine your risk tolerance.
  43. Is the EWZ Brazil ETF a Buy Right Now?

    An in depth look at iShares MSCI Brazil Capped, the largest ETF offering exposure to this emerging market.
  44. Is Now A Good Time To Invest in Tesla?

    Tesla offers prospects for rewards, but risks are many. Risks include strong competition, rewards include market potential ...
  45. Trade Forex Through Inside Day Breakout Strategy

    Inside day breakout is a popular strategy for forex trading. Here's how to recognize the patterns, entry/exit points and ...
  46. Risks and Rewards of Biotech Companies

    We look at the risks and rewards of investing in biotech companies.
  47. Want to Focus on Tech? Consider this ETF

    QQQ has appreciated over 75% over the past three years. Is this trend likely to continue?
  48. The 10 Riskiest Investments

    Investors seeking high returns must also be prepared for high risk. Here are ten of the riskiest investments available.
  49. Why Is Arbitrage Trading Legal?

    Not only is arbitrage legal in the US and most developed countries, it can be beneficial to the overall health of a market.
  50. Four Key Pharmaceuticals ETFs To Consider

    ETF funds are now very liquid investments and are suitable to investors who seek to match the price performance of the indexes ...
  51. The Risks And Rewards Of Pharma Stocks

    While pharmaceutical stocks have certain risks, big pharma companies have stable cash flows and pricing power, offering opportunities ...
  52. Capitalize On Collars To Enhance Your Trades

    Trade collaring measures current technicals and makes swift adjustments to account for environmental changes.
  53. How Investment Risk Is Quantified

    FInancial advisors and wealth management firms use a variety of tools based in Modern portfolio theory to quantify investment ...
  54. Manhattan Luxury Condos As Investments

    New York City real estate is a trending investment for foreign investors.
  55. Eyeing REITs? Consider these Risks

    REITs are a great way to invest in real estate without all the drama and headaches. That said, there are risks.
  56. Are These 2015's Most Promising Mutual Funds?

    For 2015, the mutual funds covered below are likely to offer more upside potential than the vast majority of mutual funds ...
  57. Why These ETFs are the Best Way to Trade Pfizer

    Looking to play Pfizer with diversification? Consider these ETFs.
  58. This ETF Offers Cheap, Easy Access to Financials

    XLF isn't like most ETFs for one very important reason.
  59. How To Manage Portfolio Risk

    Follow these tips to successfully manage portfolio risk.
  60. Five Janus Mutual Funds With High Alpha

    A look at some of the alpha-generating equity funds from Janus.
  61. Is Apple's Stock Over Valued Or Undervalued?

    Despite several drawbacks, the CAPM gives an overview of the level of return that investors should expect for bearing only ...
  62. Figuring Out How To Cover Your Liability Bases

    Whenever we talk about the asset-liability approach to portfolio management (ALM), the concepts of immunization and cash ...
  63. What’s The Latest Market Volatility Strategy?

    A minimum volatility (min vol) strategy would be top of mind for investors. In today’s market climate the case for min vol ...
  64. Ten Worst Mistakes Beginner Investors Make

    Here are the ten worst mistakes beginning investors make.
  65. Risk Management Framework (RMF): An Overview

    A company must identify the type of risks it is taking, as well as measure, report on, and set systems in place to manage ...
  66. Trader Rookie Mistakes: Avoid Them While You Can!

    These 10 common trading mistakes can rob capital and undermine confidence.
  67. What You Should Know About Smart Beta ETFs

    Smart Beta funds get a lot of hype and are a relatively cheap way to get exposure to an asset class. But they are not foolproof. ...
  68. The Capital Asset Pricing (CAPM) Model: Pros and Cons

    CAPM, while criticized for its unrealistic assumptions, provides a more useful outcome than either the DDM or WACC in many ...
  69. Must-Know Simple & Effective Exit Trading Strategies

    An effective exit strategy builds confidence, trade management skills and profitability.
  70. P2P Loans: Consider the Payoffs; Assess The Risks

    The available data seems to indicate that P2P loans, although risky, promise great payoffs, and the prospects of good returns ...
  71. Margin Investing: Big Risk, Big Reward

    Investing on margin can be profitable but it's a risky play that needs care.
  72. What Can The Monte Carlo Simulation Do For Your Portfolio?

    A Monte Carlo simulation allows analysts and advisors to convert investment chances into choices. The advantage of Monte ...
  73. How A Limited Government Affects A Country's Finances

    Countries with limited governments have fewer laws about what individuals and businesses can and can’t do. What's the net ...
  74. Choosing The Right ETF Index To Reach Your Goals

    The key to choosing ETFs for your portfolio is understanding how they pick stocks and making sure their investment philosophy ...
  75. How Does Goodwill Affect Financial Statements?

    Goodwill is a bit of a paradox--intangible, yet it is recorded as an asset on the purchasing company's balance sheet.
  76. Using Normal Distribution Formula To Optimize Your Portfolio

    Normal or bell curve distribution can be used in portfolio theory to help portfolio managers maximize return and minimize ...
  77. How To Research Volatile Stocks

    Volatile stocks scare some investors--they're worried about something they need to keep an eye on. Fortunately, great software ...
  78. Penny Stocks, Options and Trading on Margin

    You may not be able to trade penny-stock options, but small-caps and micro-caps could be close enough. Here's a primer on ...
  79. Playing Penny Stock-Like ETFs

    While there are no penny stock ETFs or mutual funds, a shrewd investor can pick from a number of small-cap and micro-cap ...
  80. Study These Penny Stock Trading Trends

    Any active trader watches trends patterns to devise a strategy. Penny stock traders should do the same; it could help them ...
  81. The Government And Risk: A Love-Hate Relationship

    Though the U.S. government can help its citizens by subsidizing risky loans, the costs always come back to the taxpayers. ...
  82. Can Good News Be A Signal To Sell?

    Sometimes positive announcements can mean bad news for a stock. Find out why.
  83. How To Pick Winning Penny Stocks

    Cheap doesn't always equal good. When choosing penny stocks, investors would be wise to note several key factors that affect ...
  84. Beware Of Wall Street's Three Big Lies

    Don't get swindled into buying snake oil from Wall Street. Find out three lies that can lead to losing investments.
  85. How To Become A Corporate Board Member

    We look at how corporate boards are constructed, and how investors can get involved.
  86. Using Historical Volatility To Gauge Future Risk

    Use these calculations to uncover the risk involved in your investments.
  87. Protecting Your Retirement Assets

    Your golden years are meant to be stress free. Keep them that way by protecting your assets.
  88. How Influential Economists Changed Our History

    Find out how these five groundbreaking thinkers laid our financial foundations.
  89. Investment Misselling A Global Problem

    When banks and advisors focus on fees and commissions, it is investors and the market that take the hit.
  90. How To Become A Sophisticated Investor

    No one doubts the value and importance of investor education and sophistication, but many investors are not really all that ...
  91. Cashing In On The Venture Capital Cycle

    Find out how VC firms make the market go round, and round and round.
  92. Valuing Firms Using Present Value Of Free Cash Flows

    When trying to evaluate a company, it always comes down to determining the value of the free cash flows and discounting them ...
  93. The Green Marketing Machine

    Don't let corporations greenwash their dirty laundry. Learn how to spot a phony.
  94. How To Lie With Financial Statistics

    Can you really trust what the financial services industry puts out? We tell about some tricks that hide the truth.
  95. The German Economic Miracle

    After World War II, Germany was in ruins. Learn about the country's quick rise to the third strongest economy in the world. ...
  96. The Basics of Options Profitability

    The adage "know thyself"--and thy risk tolerance, thy underlying, and thy markets--applies to options trading if you want ...
  97. 4 Psychological Traps That Are Killing Your Portfolio

    Sometimes your largest financial hurdle is our head. Learn about the common mind-traps that trip up investors.
  98. 4 Steps To Creating A Better Investment Strategy

    Make your trading safer and more streamlined by following these simple guidelines.
  99. What Are The Odds Of Scoring A Winning Trade?

    Just because you're on a winning streak doesn't mean you're a skilled trader. Find out why.
  100. 5 Investment Risks Created By Global Warming

    Climate-change deniers and believers alike would be wise to prepare for the worst.
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