Mosaic Theory

AAA

DEFINITION of 'Mosaic Theory'

A method of analysis used by security analysts to gather information about a corporation. Mosaic theory involves collecting public, non-public and non-material information about a company in order to determine the underlying value of the company's securities and to enable the analyst to make recommendations to clients based on that information.

INVESTOPEDIA EXPLAINS 'Mosaic Theory'

Some see this style of analysis as a misuse of insider information, but the CFA Institute (formerly known as AIMR) has recognized mosaic theory as a valid method of analysis. However, analysts using this method should disclose the details of the information and methodology they used to arrive at their recommendation.

RELATED TERMS
  1. Chartered Financial Analyst - CFA

    A professional designation given by the CFA Institute (formerly ...
  2. Security Analyst

    A financial professional who studies various industries and companies, ...
  3. Material Insider Information

    Material information, about certain aspects of a company, that ...
  4. Analyst

    A financial professional who has expertise in evaluating investments ...
  5. Insider Information

    A non-public fact regarding the plans or condition of a publicly ...
  6. Money Manager

    A business or bank responsible for managing the securities portfolio ...
RELATED FAQS
  1. How do I perform a financial analysis using Excel?

    Investors can use Excel to run technical calculations or produce fundamental accounting ratios. Corporations use Excel to ... Read Full Answer >>
  2. Why is the Trade Volume Index (TVI) important for traders and analysts?

    The trade volume index (TVI) is important for traders and analysts because it indicates whether an asset is being accumulated ... Read Full Answer >>
  3. What kinds of financial analysis jobs are there?

    The official definition of a financial analyst, per the Bureau of Labor Statistics (BLS), is someone who provides help with ... Read Full Answer >>
  4. What types of information does one need to perform a thorough financial analysis?

    To perform a thorough financial analysis, an analyst would need to calculate and analyze ratios based on numbers found on ... Read Full Answer >>
  5. When might an analyst take an overweight position in a particular stock?

    An analyst may take an overweight position in a stock when he has a high degree of conviction that the stock will outperform. ... Read Full Answer >>
  6. Why do analysts sometimes give an overweight recommendation on a stock?

    Financial analysts give their opinions of the future performance of a security. They can give performance ratings of underweight, ... Read Full Answer >>
Related Articles
  1. Insurance

    What You Need To Know About Financial Analysts

    Thinking about relying on analyst recommendations for your next trade? We'll show you what to watch out for.
  2. Economics

    Defining Illegal Insider Trading

    The better you understand why insider trading can be criminal, the better you'll understand how the market works.
  3. Markets

    Introduction To Fundamental Analysis

    Learn this easy-to-understand technique of analyzing a company's financial statements and reports.
  4. Professionals

    How Financial Advisors Pick Client Investments

    How advisors choose investment portfolios is varied, and investors are wise to check with theirs to find out how he or she makes their investment choices.
  5. Personal Finance

    5 Signs You're Getting Bad Financial Advice

    Use good judgment and practice due diligence when contracting with professional money managers and advisors.
  6. Fundamental Analysis

    Why Last In First Out Is Banned Under IFRS

    We explain why Last-In-First-Out is banned under IFRS
  7. Stock Analysis

    How Are Interest Rates Affecting Annaly Cap Mgmt?

    Annaly Capital Management reported a net loss of $658 million thanks to the mortgage REIT's strategy of hedging its exposure to higher interest rates.
  8. Credit & Loans

    How To Become a Mortgage-Backed Securities Analyst

    Specializing in structured or derivative credit products like mortgage-backed securities requires education and prior experience in the mortgage field.
  9. Investing

    Why These Are 2015's Most-Promising Stocks

    A short list of stocks with strong potential for 2015 and beyond.
  10. Stock Analysis

    The Death Of The Glamour Stock

    The market has started to realize that QE didn’t keep U.S. Treasury rates low. Instead it encouraged risk-seeking behavior in the global financial markets.

You May Also Like

Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  3. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  4. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
  5. Rule Of 70

    A way to estimate the number of years it takes for a certain variable to double. The rule of 70 states that in order to estimate ...
  6. Risk Premium

    The return in excess of the risk-free rate of return that an investment is expected to yield. An asset's risk premium is ...
Trading Center