Investment horizon is a fundamental concept in financial planning and investment management. It refers to the length of time an investor expects to hold an investment before cashing it out. The investment horizon is a critical factor in deciding which investment products are suitable for an investor. It can range from short-term (a few months … Read more
Investing in a mutual fund involves entrusting your money to a fund manager, who makes decisions about which securities to include in the fund. This process, known as the security selection process, is a critical aspect of fund management that can significantly impact the fund’s performance. What is Security Selection? Security selection is the process … Read more
While hedging strategies are essential for managing financial risk, they come with their own set of drawbacks that companies must consider. Here are some of the key disadvantages associated with hedging strategies: 1. Costs: Hedging can be expensive, especially if it involves purchasing financial instruments like options or futures. These costs can eat into the … Read more
Deciding when to hedge and when not to is a critical decision for companies, especially those with exposure to volatile commodities like oil. The process involves a careful analysis of various factors that can affect the company’s financial health and operational efficiency. Here are some key considerations that companies take into account when making hedging … Read more