What Is The Fundamental Approach of Making Investment Decisions?
Fundamental Approach: The basic talents of fundamental approach are as follows: There is an intrinsic value for each stock and this value can be...
Fundamental Approach: The basic talents of fundamental approach are as follows: There is an intrinsic value for each stock and this value can be...
An investor is surrounded by many factors in his consideration of making investments. He is interested in minimizing risk and maximizing returns. He is...
SOURCES OF INVESTMENT RISK: The fluctuation in an investment’s return attributable to changes in broad economic social or political factors which...
SELECTING THE SECURITIES: Once the objective of the portfolio is determined the securities to be included in the portfolio must be selected. For bond...
WEIGHING CONSTRAINTS: The last stage in determining portfolio policies is to establish the constraints on the portfolio. This involves weighing each constraint individually and...
PRINCIPLES OF PORTFOLIO CONSTRUCTION: The portfolio manager has to follow certain principles while constructing a portfolio. These principles are as follows: SAFETY...
FORMULATING THE PORTFOLIO OBJECTIVES: The portfolio objectives can b determined by ascertaining the constraints on a portfolio. The greater the number of constraints...
COLLECTING THE BASIC DATA: Initially, the portfolio manager has to devote a great deal of attention to basic consideration such as pension plans,...
PORTFOLIO COMPOSITION: The principal objective of the traditional approach is to select the portfolio of securities that most appropriately meets the investor’s needs....
Markowitz Approach to constructing portfolio: Markowitz Approach provides a systematic search for optimal It enables the investors to locate minimum variance portfolio i.e. portfolio...