What is Correlation?
Correlation measures the strength of the linear relationship between two variables and is always between -1 & 1
What does Volatility Mean?
Volatility is a statistical measure of a security's or market index's return dispersion. The more the volatility, the...
Treynor Ratio
The Treynor Ratio is a performance indicator that shows how much excess return a portfolio created for each unit of r...
Mortgage Backed Securities & its Importance
Mortgage-backed securities, called MBS, are bonds secured by home and other real estate loans. MBS is a product of As...
Counterparty Risk
Counterpart risk is defined as the risk that a counterparty is unable or unwilling to live up to its contractual obli...
Foreign Currency and Local Currency Defaults
Foreign currency defaults occur when countries fail to repay debt, while local currency defaults often result from in...
Futures Contract
Futures Contract - Financial institutions use Hedging to increase financial stability and reduce the risk of financia...
LOGIT models
LOGIT model is rom the Generalized Linear Model (GLM) family. It is primarily widely used as a statistical tool to pr...
Mean Reversion
Mean reversion is the tendency of a variable to revert to a long-term level, which can also be called an unconditiona...
What is Risk Appetite?
Risk appetite refers to the level (and types) of risk that a firm is willing to retain.