Mosaic Theory


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.

BREAKING DOWN '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.

  1. Insider Information

    A non-public fact regarding the plans or condition of a publicly ...
  2. Analyst

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

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

    A financial professional who studies various industries and companies, ...
  5. Money Manager

    A business or bank responsible for managing the securities portfolio ...
  6. Chartered Financial Analyst - CFA

    A professional designation given by the CFA Institute (formerly ...
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