Friday, August 24, 2007

"Death" Bond

A security backed by life insurance which is derived by pooling together a number of transferable life insurance policies. Similar to mortgage-backed securities, the life insurance policies are pooled together and then repackaged into bonds to be sold to investors.
If the person lives longer than expected, the bond's yield will begin declining. However, because the death bonds are created from an underlying pool of assets, the individual risk associated with one policy is spread out, making the instruments more stable.

Courtesy: Investopedia (Original Post @ http://www.investopedia.com/terms/d/death_bond.asp)

Thursday, May 24, 2007

What is the difference between fundamental and technical analysis?

These terms refer to two different stock-picking methodologies used for researching and forecasting the future growth trends of stocks.
  • Fundamental analysis is a method of evaluating securities by attempting to measure the intrinsic value of a stock. Fundamental analysts study everything from the overall economy and industry conditions to the financial condition and management of companies.
  • Technical analysis is the evaluation of securities by means of studying statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security's intrinsic value but instead use stock charts to identify patterns and trends that may suggest what a stock will do in the future.
Courtesy: Investopedia.com (original post @ http://www.investopedia.com/ask/answers/131.asp)
Introduction to Fundamental Analysis @ http://www.investopedia.com/university/fundamentalanalysis/
Introduction to Technical Analysis @ http://www.investopedia.com/university/technical/

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