Sentences with phrase «risky assets because»

In other words, true long - term investors are more willing to allocate towards risky assets because they don't care about the short - term ups and downs.

People accept the possibility of losses from risky assets because they believe returns will be larger over time.

NEW YORK U.S. stocks ended mixed on Wednesday while most other global shares rose, as investors were drawn to riskier assets because of upbeat earnings from companies in Europe and the United States.

Cash feels safe in the short - term, but in the long - term it is the riskiest asset because it is guaranteed to decline in value relative to inflation.

Not exact matches

«Goodwill is one of the riskiest assets that can be financed because it typically has no liquidation value,» an SBA spokesman explained last week.

Rather, they should be anticipated, because periods of underperformance occur in every risky asset class and factor.

If fund managers are trying to pass off some of the best safest assets today as risky, simply because their mandates restrict them from investing in them, then it's time for us to take back control of our own wealth management.

It's risky to invest too much in bonds or other low risk assets, because those equal to lower returns.»

Because the bank does not bear the downside, it has an incentive to load up on the riskiest assets available in order to maximize its expected profit.

In JPMorgan you are talking about high salaried people who are risky assets for companies because of the knowledge they hold.

With fully two - thirds of its money invested in domestic and foreign stocks, private equity and «absolute return strategies» (i.e., hedge funds), the New York State pension fund has a risky asset allocation profile typical of its counterparts across the country — because chasing risk is its only hope of earning 7 percent a year in a market where the most secure long - term bonds yield barely 2 percent.

Not only are the extremely risky compared to other assets, most young people won't be able to own those in a tax deferred account for a long time because they won't have the capital inside the account.

In financial theory, riskier investments are expected to be more profitable because investments normally offer a reward in exchange of risk absorption — if they offered no reward, investors would buy the less - risky assets instead.

Blanket liens are preferred by lenders because they are secured by multiple assets and are therefore less risky.

It's true that some see peer - to - peer lending as a risky asset class because you are relying on strangers to pay the loan back.

This is simply because at various times in market cycles either stocks or bonds could be the most risky asset class.

DJ: In my opinion, your asset allocation is far too risky because even your youngest is only 8 years from finishing his / her degree.

Riskier assets like stocks have a higher rate of expected return so if your time horizon is long enough, don't avoid stocks completely just because they are more volatile than fixed income or cash.

The stock with a beta coefficient larger than one (or negative one) is riskier because its price swings wider than the asset class does.

Bank of America economists said shocks such as Brexit cause more volatility than used to be the case because banks and other financial institutions are less keen to circulate risky assets.

Beyond that, no modeling of asset correlations would be brought into the modeling because risky asset correlations go to one in a crisis.

This is on top of the problem that when high - quality long interest rates are so low, it is typically a bad time to try to make money in financial assets, because returns on risky assets are typically only 0 - 2 % percent higher than the yield on long BBB / Baa debt over the long run.

There's also an academic Modern Portfolio Theory explanation for why you should diversify among risky assets (aka stocks), something like: for a given desired risk / return ratio, it's better to leverage up a diverse portfolio than to use a non-diverse portfolio, because risk that can be eliminated through diversification is not compensated by increased returns.

My asset allocation is on the riskier side at 90 % stocks, 10 % bonds because I am looking at a 40 + year time frame -LSB-...]

Then in this case, you can afford to put a large portion of your investments in risky assets such as stocks because you will still have enough time to wait for the stock market to recover even if it crashes today (look what happened in 2008 and 2009 and where the markets are today).

Rather, they should be anticipated, because periods of underperformance occur in every risky asset class and factor.

First mortgages are generally less risky because they are the first to get repaid and the first to claim any property provided as collateralCollateral Property or assets that you pledge as a borrower as a guarantee that you will repay the loan.

These are riskier than hard assets because of the possibility that the earnings won't be fully collected.

Somewhat surprisingly, it would more risky for an insurance company to invest in TIPS because it would create asset liability mismatch.

The magic of diversification is that you can take two risky assets, and when you blend them, the result becomes less risky because they zig and zag at different times.

And part three is that people feel wealthier because those risky assets rise in value and they'll spend more because of the wealth effect.

Because if riskier assets could be counted on for higher returns than they wouldn't be riskier.

Because of the behavior of investors, and increasing interconnectedness between markets, the degree that risky assets diversify each other has been decreasing over time.

As it is now, a large portion of the FHLBs may no longer deserve their AAA ratings because of the losses they may take from risky mortgage assets.

All of this has a way of reducing risk, too, because it's naturally less risky (in terms of capital risked) to pay less than more for the same asset.

According to CAPM, investors should hold the market portfolio because it is the optimal portfolio of risky assets.

The subprime crisis came about in large part because of financial instruments such as securitization where banks would pool their various loans into sellable assets, thus off - loading risky loans onto others.

In the process, because of the over-leverage allowed for high returns on equity to be generated from low returns on assets, the buyers of risky assets overpaid for their interests.

Eventually investors will reach a point though where they seek out riskier investments / real assets / capital gains, because they've a) regained their confidence, b) become so desperate in response to continued yield compression, and / or c) become sufficiently fearful of actual / anticipated inflation.

If you don't want to do that, because you're close to having enough, or will soon, then start looking over the risky (sector) asset classes in rows 99 to 104.

The catch is most of these are the same asset classes that are usually minimized, because they're «too risky,» or don't provide a reasonable income yield.

Because of that, it's less risky to you — by defaulting, you're mainly risking credit damage instead of your house, car, or other assets.

Risky assets are risky because of when they will lose you mRisky assets are risky because of when they will lose you mrisky because of when they will lose you money.

Trowbridge explains that families with teenage drivers need high liability limits because teens are among the riskiest drivers on the road, and if they cause an accident, the injured party can come after the parents» assets.

ETFs are just groups of stocks, commodities, or bonds, and they're less risky than buying individual assets because the group works to balance itself out; if one stock tanks, it's offset by other assets in the ETF.

«Ownership of virtual currency is very risky and full of speculation because there is no authority responsible,» the central banker continues, «there is no official administrator, there is no underlying asset underlying virtual currency price and trading value is very volatile so vulnerable to the risk bubble and prone to be used as a means of washing money and financing of terrorism, so that it can affect the stability of the financial system and harm the public.

Now, that's because they're making a riskier loan to you because they're loaning against a property that's usually in bad condition and their money isn't secure by anything other than that asset.