The city is in the midst of a building boom.All over downtown, the landscape is changing as office space gets tighter and towers sprout up on once-empty street-level parking lots. One of the city’s largest,most prestigious contractors has just completed negotiations with a legal firm to build a new office tower. The location was selected, [...]
The implementation of the desmoothing methodology increases portfolio risk. We already mentioned that there is a permanent and relatively stable component in bond (index) returns resulting from interest accrual, roll down and yield-curve effects. Therefore we apply the desmoothing technique only to the series of monthly changes in the price indices, and afterwards add the [...]
Lower rated bonds or bonds with higher spreads behave more like equities in falling equity markets (crisis scenario). For high-yielding bonds (highyield debt), the strike price (the value of indebtedness) is normally closer to at-the-money than in the case of investment grade bonds. The high-yield market spread is correlated with the S&P 500 as a [...]
Simply recognising the need to manage risk is not enough. The ethos of an organisation should recognise and reward behaviour that manages risk. This requires a commitment by senior managers and the resources (including training) to match. Too often, control systems are seen only as an additional overhead and not as something that can add [...]
Experience shows that risk must be actively managed and accorded a high priority, not only within the decision-making process but permanently and throughout the organisation. This might mean that risk-management procedures and techniques are well documented, clearly communicated and regularly reviewed and monitored. In order to manage risks, you have to know what they are, [...]
My name is Emily Mortimer. I'm an academy professor with a degree in economy and considerable experience in training both students and private contractors in matters of business, finances and money management.