Discover how to calculate covariance to assess stock relationships and optimize your portfolio, balancing risk and potential ...

Learn about semivariance, a key metric for assessing a portfolio’s downside risk. Understand its formula and how to calculate potential negative variations below the mean.

Diversification has been called the oldest trick in the investment book. So old that to construct a diversified portfolio, it is still common to apply mean-variance optimisation, a 70-year-old ...

Forbes contributors publish independent expert analyses and insights. Portfolio diversification represents one of the fundamental principles of investment management. By strategically allocating ...

Beta is the 2nd letter in the Greek alphabet, and the financial world uses it to refer to the sensitivity of an asset’s price compared to a specific index or benchmark. Beta is also used as a measure ...

Adopting an appropriate factor model enables us to pinpoint the hidden forces that drive the movement of the market and contribute to its systematic risk. We argue that risk management should be ...