Definition Arbitrage is taking advantage of price differences between identical assets in multiple markets. Those multiple markets could be different in identity or different temporally. Example 1 You are at a garage sale and you see a lamp that costs … Continue reading
Definition Heuristics are mental short cuts. They are ways that we can speed up the decision-making process. Rather than consider all the data, which is time consuming and difficult, someone takes some of the data and makes assumptions in regards … Continue reading
Introduction Marginal value is marginal benefit minus marginal cost. It is simply how much benefit you get per each additional unit of measure (marginal benefit) minus how much it costs you per each additional unit of measure (marginal cost). Example … Continue reading
Introduction In an earlier post, I defined what future value and what present value is. In this post, I’m going to go through some of the mathematics of how you can calculate those values. How to Calculate Future Value The … Continue reading
Introduction Everyone’s’ portfolio gains were extraordinarily fat this month and quarter. For the quarter, the Dow was up 7.94%. Small cap was up even more at 8.43%. With only a few exceptions, every one of you has a blend of … Continue reading