Sentences with phrase «return over risk»

The Sharpe ratio is a simple, but effective, measure of risk - adjusted return comparing an investment's excess return over the risk - free rate to its standard deviation of returns.

Absolute momentum based trend following filter is used to switch any selected assets that have a negative excess return over the risk free rate to Vanguard Total Bond Market Index Inv (VBMFX).

Relative strength is used to select the best performing model asset (s) and absolute momentum is then applied as a trend - following filter to only invest in the selected asset (s) if the excess return over the risk free rate has been positive.

More specifically, it considers the excess return over the risk - free rate * that market participants demand for investing in a broadly diversified portfolio of equity securities.

The upper graph represents the numerator, the excess return over the risk - free rate.

The numerator of the Sharpe ratio is an investment's excess return over the risk - free rate.

When building portfolios, most investors tend to focus on the appeal of return over risk.

Sharpe and Sortino ratios are calculated and annualized from monthly excess returns over risk free rate (1 - month t - bills)

Not exact matches

Important factors that could cause actual results to differ materially from those reflected in such forward - looking statements and that should be considered in evaluating our outlook include, but are not limited to, the following: 1) our ability to continue to grow our business and execute our growth strategy, including the timing, execution, and profitability of new and maturing programs; 2) our ability to perform our obligations under our new and maturing commercial, business aircraft, and military development programs, and the related recurring production; 3) our ability to accurately estimate and manage performance, cost, and revenue under our contracts, including our ability to achieve certain cost reductions with respect to the B787 program; 4) margin pressures and the potential for additional forward losses on new and maturing programs; 5) our ability to accommodate, and the cost of accommodating, announced increases in the build rates of certain aircraft; 6) the effect on aircraft demand and build rates of changing customer preferences for business aircraft, including the effect of global economic conditions on the business aircraft market and expanding conflicts or political unrest in the Middle East or Asia; 7) customer cancellations or deferrals as a result of global economic uncertainty or otherwise; 8) the effect of economic conditions in the industries and markets in which we operate in the U.S. and globally and any changes therein, including fluctuations in foreign currency exchange rates; 9) the success and timely execution of key milestones such as the receipt of necessary regulatory approvals, including our ability to obtain in a timely fashion any required regulatory or other third party approvals for the consummation of our announced acquisition of Asco, and customer adherence to their announced schedules; 10) our ability to successfully negotiate, or re-negotiate, future pricing under our supply agreements with Boeing and our other customers; 11) our ability to enter into profitable supply arrangements with additional customers; 12) the ability of all parties to satisfy their performance requirements under existing supply contracts with our two major customers, Boeing and Airbus, and other customers, and the risk of nonpayment by such customers; 13) any adverse impact on Boeing's and Airbus» production of aircraft resulting from cancellations, deferrals, or reduced orders by their customers or from labor disputes, domestic or international hostilities, or acts of terrorism; 14) any adverse impact on the demand for air travel or our operations from the outbreak of diseases or epidemic or pandemic outbreaks; 15) our ability to avoid or recover from cyber-based or other security attacks, information technology failures, or other disruptions; 16) returns on pension plan assets and the impact of future discount rate changes on pension obligations; 17) our ability to borrow additional funds or refinance debt, including our ability to obtain the debt to finance the purchase price for our announced acquisition of Asco on favorable terms or at all; 18) competition from commercial aerospace original equipment manufacturers and other aerostructures suppliers; 19) the effect of governmental laws, such as U.S. export control laws and U.S. and foreign anti-bribery laws such as the Foreign Corrupt Practices Act and the United Kingdom Bribery Act, and environmental laws and agency regulations, both in the U.S. and abroad; 20) the effect of changes in tax law, such as the effect of The Tax Cuts and Jobs Act (the «TCJA») that was enacted on December 22, 2017, and changes to the interpretations of or guidance related thereto, and the Company's ability to accurately calculate and estimate the effect of such changes; 21) any reduction in our credit ratings; 22) our dependence on our suppliers, as well as the cost and availability of raw materials and purchased components; 23) our ability to recruit and retain a critical mass of highly - skilled employees and our relationships with the unions representing many of our employees; 24) spending by the U.S. and other governments on defense; 25) the possibility that our cash flows and our credit facility may not be adequate for our additional capital needs or for payment of interest on, and principal of, our indebtedness; 26) our exposure under our revolving credit facility to higher interest payments should interest rates increase substantially; 27) the effectiveness of any interest rate hedging programs; 28) the effectiveness of our internal control over financial reporting; 29) the outcome or impact of ongoing or future litigation, claims, and regulatory actions; 30) exposure to potential product liability and warranty claims; 31) our ability to effectively assess, manage and integrate acquisitions that we pursue, including our ability to successfully integrate the Asco business and generate synergies and other cost savings; 32) our ability to consummate our announced acquisition of Asco in a timely matter while avoiding any unexpected costs, charges, expenses, adverse changes to business relationships and other business disruptions for ourselves and Asco as a result of the acquisition; 33) our ability to continue selling certain receivables through our supplier financing program; 34) the risks of doing business internationally, including fluctuations in foreign current exchange rates, impositions of tariffs or embargoes, compliance with foreign laws, and domestic and foreign government policies; and 35) our ability to complete the proposed accelerated stock repurchase plan, among other things.

Over time, your investors will get more comfortable with you; they won't hesitate for smaller returns, knowing their risk is minimal.

That allows them to accept risks that should lead to higher average returns over the long term.

The payoff: Risk doesn't guarantee higher average returns, but it makes them more likely over the life of a long - term investment.

Over the past several years, quantitative easing has taken money originally allocated for bonds, fixed income, and designated fixed return, and pushed it to take risks.

«We had to find a niche [that had] less competition but also generated a better return than the market with less risk over time,» he says.

Because spreading your money across different investments decreases your risk, increases your upside returns over time and does not cost you anything.

Value investors like Buffett will tell you that such stocks are a better bet over the long term because they provide better returns with less risk.

Actual results, including with respect to our targets and prospects, could differ materially due to a number of factors, including the risk that we may not obtain sufficient orders to achieve our targeted revenues; price competition in key markets; the risk that we or our channel partners are not able to develop and expand customer bases and accurately anticipate demand from end customers, which can result in increased inventory and reduced orders as we experience wide fluctuations in supply and demand; the risk that our commercial Lighting Products results will continue to suffer if new issues arise regarding issues related to product quality for this business; the risk that we may experience production difficulties that preclude us from shipping sufficient quantities to meet customer orders or that result in higher production costs and lower margins; our ability to lower costs; the risk that our results will suffer if we are unable to balance fluctuations in customer demand and capacity, including bringing on additional capacity on a timely basis to meet customer demand; the risk that longer manufacturing lead times may cause customers to fulfill their orders with a competitor's products instead; the risk that the economic and political uncertainty caused by the proposed tariffs by the United States on Chinese goods, and any corresponding Chinese tariffs in response, may negatively impact demand for our products; product mix; risks associated with the ramp - up of production of our new products, and our entry into new business channels different from those in which we have historically operated; the risk that customers do not maintain their favorable perception of our brand and products, resulting in lower demand for our products; the risk that our products fail to perform or fail to meet customer requirements or expectations, resulting in significant additional costs, including costs associated with warranty returns or the potential recall of our products; ongoing uncertainty in global economic conditions, infrastructure development or customer demand that could negatively affect product demand, collectability of receivables and other related matters as consumers and businesses may defer purchases or payments, or default on payments; risks resulting from the concentration of our business among few customers, including the risk that customers may reduce or cancel orders or fail to honor purchase commitments; the risk that we are not able to enter into acceptable contractual arrangements with the significant customers of the acquired Infineon RF Power business or otherwise not fully realize anticipated benefits of the transaction; the risk that retail customers may alter promotional pricing, increase promotion of a competitor's products over our products or reduce their inventory levels, all of which could negatively affect product demand; the risk that our investments may experience periods of significant stock price volatility causing us to recognize fair value losses on our investment; the risk posed by managing an increasingly complex supply chain that has the ability to supply a sufficient quantity of raw materials, subsystems and finished products with the required specifications and quality; the risk we may be required to record a significant charge to earnings if our goodwill or amortizable assets become impaired; risks relating to confidential information theft or misuse, including through cyber-attacks or cyber intrusion; our ability to complete development and commercialization of products under development, such as our pipeline of Wolfspeed products, improved LED chips, LED components, and LED lighting products risks related to our multi-year warranty periods for LED lighting products; risks associated with acquisitions, divestitures, joint ventures or investments generally; the rapid development of new technology and competing products that may impair demand or render our products obsolete; the potential lack of customer acceptance for our products; risks associated with ongoing litigation; and other factors discussed in our filings with the Securities and Exchange Commission (SEC), including our report on Form 10 - K for the fiscal year ended June 25, 2017, and subsequent reports filed with the SEC.

If equities in one part of the world are overvalued, diversification helps ensure that lower valuations in other parts of the world help offset any potential risks and even out portfolio returns over time.

As always, more return leads to more risk but by spreading out your portfolio over a number of different assets you can continue to decrease your risk of holding only one type of investment.

These are the risk premiums over 10, 20 and 30 year time frames based on the annual returns for the total U.S. stock market (represented by the CRSP Total Market Index) and 20 Year Treasuries going back to 1926:

By investing in a diverse pool of assets, it should collectively lower your risk yet stabilize your returns over the long term.

When you look back on this moment in history, remember that rich valuations had not only been associated with low subsequent market returns, but also with magnified risk of deep interim price losses over shorter horizons.

Portfolio risk is measured using standard deviation, which is a statistical measure of how much a return varies over an extended period of time.

There is a debate, to be sure, over how many stocks are needed to reduce risk while maintaining a high return.

Our time - tested approach to fixed income investing seeks to actively exploit market inefficiencies to generate strong risk - adjusted returns over the long run.

The Fund is an ideal complement to bullion for investors interested in silver; exposure to both equities and bullion can provide better risk - adjusted returns over the long - term;

While valuations drive long - term returns, the primary driver of market returns over shorter portions of the market cycle is the attitude of investors toward risk, as indicated by the uniformity or divergence of market internals.

That difference may be positive or negative and therefore represents our largest source of risk, but over time, it has also represented the primary source of long - term Fund returns.

Institutional investors love to show that they beat their benchmark or some risk - adjusted return target or their peers in the industry over the most recent one year period.

The essential thing to understand about valuations is that while they are highly reliable measures of prospective long - term market returns (particularly over 10 - 12 year horizons), and of potential downside risk over the completion of any market cycle, valuations are also nearly useless over shorter segments of the market cycle.

Our measure of the U.S. equity risk premium — one gauge of equities» expected return over government debt — has fallen since the global financial crisis.

Conversely, when the inclinations of investors shift from risk - aversion to speculation in an undervalued market, extraordinary returns can unfold over a very short period of time.

The main driver of market returns over shorter segments of the market cycle is the purely psychological inclination of investors toward speculation or risk - aversion.

Valuations are the primary driver of long - term returns, and the risk - preferences of investors — as conveyed by the uniformity or divergence of market action across a broad range of individual stocks, industries, sectors and security types (including credit)-- drive returns over shorter portions of the market cycle.

While long - term market returns are driven almost exclusively by valuations, investment returns over shorter segments of the market cycle are highly dependent on investor psychology, particularly the inclination of investors toward speculation or risk - aversion.

Specifically, analysts argue that the «equity risk premium» — the expected return of stocks over and above that of Treasury bonds — is actually quite satisfactory at present.

From fair prices we expect fair returns, meaning that investors should be compensated for their risk exposure over an appropriate period of time.

However, over the last several months market volatility has returned with a vengeance — a function of changing monetary policy in the U.S. and a plethora of geopolitical risks popping up around the globe.

Over the past 15 years, the fund's risk - adjusted returns have been among the highest.

Over time some «norms» have emerged in pricing based on investors risk / return profile.

Meanwhile, it's important to understand how risk and return work over the course of the market cycle, and in particular, the effect that compounding has on both returns and losses.

... [H] is risk - adjusted returns... have lagged the market over a number of time periods over the trailing 15 years.»

I then calculated the risk - adjusted returns (calculated as the returns divided by the historical volatility) for each Dividend Champion over the past 63, 126, and 252 trading days.

Monthly risk parity weights derive from actual daily asset return volatilities and correlations over the past 90 trading days.

The bond maturity premium over bills was just 0.7 % in the U.S. and 0.5 % worldwide, small with respect to the much higher risk (variability of returns).

For risk management, they forecast next - month momentum strategy volatility based on past strategy volatility calculated based on daily returns over the past one, three or six months.

Since the inception of the Fund (as well, of course, in long - term historical tests), our present approach to risk management has both added to returns and reduced volatility - not necessarily in any short period, but over the complete market cycle.

Chapter 12 — The Equity Risk Premium examines the excess returns of stocks over bills and bonds (equity risk premium) in 16 countries during 1900 to 2Risk Premium examines the excess returns of stocks over bills and bonds (equity risk premium) in 16 countries during 1900 to 2risk premium) in 16 countries during 1900 to 2000.

The main points here are that QE has encouraged the dramatic overvaluation of virtually every class of investments; that these elevated valuations don't represent «wealth» (which is embodied in the future stream of deliverable cash flows, not in the current price); that extreme valuations promise dismal future outcomes for investors over a 10 - 12 year horizon; and that until a clear improvement in market internals conveys a resumption of speculative risk - seeking by investors, the current combination of extreme valuations and increasing risk - aversion, coming off of an extended top formation after persistent «overvalued, overbought, overbullish» extremes, represents the singularly most negative return / risk classification we identify.

«We have all been taught that earning high rates of return requires taking on greater risks... If an investor can make virtually risk - free bets with outsized rewards, and keep making the bets over and over, the results are stunning.»