Questions tagged [economics]
To be used for general economics questions that are in some way related to personal finance, the subject of this site. Avoid asking questions that are speculative in nature, academic, or unrelated to personal finance.
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Strategy and science behind determining which stocks to buy and invest in?
I'm starting to get into serious investing & I being new and inexprience I have questions regarding the decline & incline in stocks.
From my understanding and research, stocks increases and ...
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Could a market-cap weighted fund of all the world’s currencies appreciate in value in the long run?
This is a thought experiment that I came up with. Imagine someone took their money (say, 100 USD) and put it in a market-cap weighted fund of all the world’s currencies. Could such a fund gain in ...
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How Do You Read This Economic Formula?
I'm trying to understand and interpret this economic formula within research where Implied Volatility is regressed on Realised volatility. But even though I understand the basics of what this article'...
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NPV in trade projects
The question must be very simple but I'm still struggling.
Let's suppose that I have an import-export business. Then I have a discounted CF which is formed by subtracting all costs & taxes from ...
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Do you lose money if you don't use a plane ticket you won in a raffle?
My wife won 2 tickets from a major airline at the company she works for, after they did a employee only raffle that was free to enter. The problem: there is a caveat: the ticket must be booked for a ...
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What does Ben Graham mean with this
In the Intelligent Investor graham says :
” investor should be able to count on the current 3.5% dividend return on his stocks and also an average annual appreciation of 4%. As we shall later explain ...
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IRR -> Reinvestment Assumption Or Myth (And What It Actually Means)
I've been trying to wrap my head around a downside of using IRR - the reinvestment assumption. I don't really understand the concept on how IRR assumes that we reinvest at the IRR, if IRR is for ...
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What happens if the volatility in the equity market increases? Does interest rates move up or down?
I think both can happen and here is my reasoning. Please correct me if I am wrong.
During times of increased volatility in the equity market, investors adopt a more risk-averse approach and gravitate ...
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Resources vs. Assets
I read an excerpt on Quora from the book, "Rich Dad, Poor Dad":
If you want to be rich you must know the difference between an asset and a liability and you must buy assets. This may sound ...
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Rationale behind market weighting in ETFs / indices
From what I understand, most global ETFs use weighting based on capitalization; so for instance there are more US stocks than European stocks in them because the US is a larger market than Europe. If ...
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How We Decide n in Compound Interest Rate Table When Annual Expenses Increasing After Certain Year?
I don't understand that, in this question's solution for HEPS9, why we take n as 6. And why we use A/G for SP240 and P/G for HEPS9.
Question:
Solution:
Compound Interest Rate Table:
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Where does the value of money go during inflation?
I was wondering if I put $1000 in the piggy bank for a year and the inflation being 10%, and everything else being constant, 1 year later that $1000 in cash money can only buy goods that today would ...
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Mortgage ETFs going down while inflation is going up?
So I'm looking at these popular mortgage ETFs, MORT and BKLN, and they have been going down over the past year, while inflation has been going up. Any idea as to why? Real estate is often regarded as ...
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Relationship between interest rates and DCF discount rates
I've been reading that interest rates lower the over future cash flows of equities, hence their decline as money can be moved elsewhere for better returns.
What is the direct relationship between ...
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Is the holiday season an unwise time to apply for credit?
Given the rise in consumer spending during the holidays, do lenders mitigate the increased demand for credit by offering lower credit limits than usual, or having stricter criteria for approval?
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