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