According to Investopedia, mean reversion is a financial theory suggesting that asset prices and returns eventually return back to the long-run mean or average of the entire dataset. Recently, the concern has been that the market is trading above historical norms and may find itself reverting to the mean (Chart 1). Paying attention to mean […]
Risk and Diversification – Understanding Risk and Why It’s Important
Every day we take risks. For “adrenaline junkies” it may mean jumping out of an airplane at 10,000 feet, riding the steepest roller coaster in the world, or swimming with sharks. But even those of us who are more risk-averse take some risks – like driving a car or playing sports. Approximately fourteen auto-related accidents[1] […]
