Fisher's Separation Theorem

Filed Under »
Dictionary Says

Definition of 'Fisher's Separation Theorem'

A theory stating that:

1. A firm's choice of investments are separate from its owner's attitudes towards the investments.

2. It is possible to separate a firm's investment decisions from the firm's financial decisions.
Investopedia Says

Investopedia explains 'Fisher's Separation Theorem'

This theory says a firm's value is not affected by how its investments are financed or how the distributions (dividends) are made to the owners.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Finance

    The science that ...
  2. Distribution

    1. When trading ...
  3. Quantity Theory Of Money

    An economic ...
  4. Fisher Effect

    An economic ...
  5. Boom

    A period of time ...
  6. Industry

    A classification ...
  7. Prisoner's Dilemma

    A paradox in ...
  8. Price Risk

    The risk of a ...
  9. Illiquid

    The state of a ...
  10. Liquidity Ratios

    A class of ...

Articles Of Interest

  1. What Are Corporate Actions?

    Be a savvy investor - learn how corporate actions affect you as a shareholder.
  2. Profiting From Panic Selling

    When everyone rushes to dump their stocks, you may find yourself with a great buying opportunity. Learn about it here.
  3. What is Fisher's separation theorem?

  4. 10 Books Every Investor Should Read

    Want advice from some of the most successful investors of all time? Check out our reading list.
  5. Should You Invest Your Entire Portfolio In Stocks?

    It is true that stocks outperform bonds and cash in the long run, but that statistic doesn't tell the whole story.
  6. The Uses And Limits Of Volatility

    Check out how the assumptions of theoretical risk models compare to actual market performance.
  7. Risk Tolerance Only Tells Half The Story

    Just because you're willing to accept a risk, doesn't mean you always should.
  8. 5 Tips For Diversifying Your Portfolio

    A diversified portfolio will protect you in a tough market. Get some solid tips here!
  9. Invest Like A Pro

    By following the strategies of the pros, even a beginner can learn to invest like an expert.
  10. 5 Nobel Prize-Winning Economic Theories You Should Know About

    Here are 5 prize-winning economic theories that you’ll want to be familiar with.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center