## Difference between Interest Rate and Exchange Rate

Interest Rate and Exchange Rate The question of interest rate arises when currencies are borrowed or lent; whereas exchange rates are involved when different currencies are being bought or sold. The…

## What is Diversification?

What is Diversification? The goal of diversification - the ultimate goal of diversification is to maximize, to get the highest possible risk-adjusted returns. Point number two Point number two sort of follows…

## Correlation Matrix

Correlation Matrix Now let's take a look at this correlation matrix. A correlation matrix is simply a collection of, of correlations. And some of those numbers may not be large enough for…

## Portfolio Risk

How to calculate Portfolio Risk? There you have ten years, three assets and let us think of those as annual returns. It does not matter whether these are Dollar returns or Euro…

## How to calculate beta?

How do we calculate Beta (ß)? What is Beta? Beta is not only a widely used measure of risk but also, it is the central magnitude in what we call the…

## What is Risk or Volatility?

What is Risk or Volatility? In finance, risk and return go always together. You cannot really separate return from risk. These are like two sides of the same coin. You…

## Types of Risk

Types of Risk In business, lots of risks are noticed. It can be aroused from the geography or the industry. Due to this reason, risk managers are now hired to…

## Systematic Risk vs Unsystematic Risk

Systematic Risk vs Unsystematic Risk Risk Analysis in Capital Budgeting Diverse ranges of risks are present in the process of investment. In case the capital is lost completely then you…