Basic concepts of assessing trading strategies, Financial Management

Assignment Help:
  • Leveraging can be described as an investing principle where borrowed funds are invested in a part of the securities. Leveraging can magnify either returns or losses from an investment for a given change in the price of that security.

  • Repurchase agreement is a contract wherein the seller of a security agrees to buy back the same security from the purchaser at a specified price and time. It is also known as repo or buyback.  

  • Reverse repo is an agreement where a buyer purchases securities with an agreement to resell them at a specified price (which is higher than the buying price) on a specified date.

  • Mark to market is the process of recording the price or value of a security or portfolio on a daily basis, to calculate profits and losses. It also helps to confirm that margin requirements are being met.

  • Trade is assessed on the basis of its performance. Performance can be defined as the expected total return over and above the investment horizon of the trade. The returns would be from: coupon payment, the change in the value of the bond, and reinvestment income derived from reinvesting coupon payments and principal repayment.

  • The process of evaluating a strategy under several scenarios is called as scenario analysis.

  • Duration is the change in the value of bond that will result from a hundred basis point change in yield.


Related Discussions:- Basic concepts of assessing trading strategies

Show financial management process, Q. Show Financial Management Process? ...

Q. Show Financial Management Process? The financial management process begins with the financial planning and decisions. While implementing these decisions, the firm has to acq

Credit spreads and the valuation of non-treasury securities, It is not easy...

It is not easy to determine the theoretical value of non-treasury securities. However, we can use the treasury spot rate for the valuation of non-treasury security.

Modigliani-miller irrelevancy theorem for capital structure, QUESTION i...

QUESTION i) Discuss the Modigliani-Miller irrelevancy theorem for corporate capital structure. What assumptions underline the theorem? ii) What are the implications when the

Defien contractual savings institutions, Contractual savings institutions ...

Contractual savings institutions Contractual savings institutions obtain funds at periodic intervals on a contractual basis. The industry is classified into two main groups ins

Valuing mortgage-backed and asset-backed securities, A cash-flow yield is t...

A cash-flow yield is the discount rate that makes the price of a mortgage-backed or asset-backed security equal to the present value of its cash flows. It is built

Financial management, DEFINITION OF FINANCIAL MANAGEMENT The term finan...

DEFINITION OF FINANCIAL MANAGEMENT The term financial management has been described by management experts in several ways reflecting the duties and responsibilities of a financ

Project on investment banking house, The Project to be Addressed by the Pap...

The Project to be Addressed by the Paper: You have just graduated from CCI's MBA program and have secured a position as a fund manager for a well known investment banking house

Budget, •What categories and in what amounts should Jenny allocate her fund...

•What categories and in what amounts should Jenny allocate her funds to reflect a balanced monthly budget? Include the main categories as well as examples of other categories.

Portfolio management, Portfolio Management: Project Portfolio Manageme...

Portfolio Management: Project Portfolio Management (PPM) is the centralized management of processes, technologies and methods used by project management offices (PMOs) and pro

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd