Factors affecting the valuation of corporate bonds

Article Abstract:

The characteristics of corporate bonds that effect their price are examined. All rating- based techniques involve working with a homogeneous population of bonds. The common assumption that MoodyEs or Standard & Poor's ratings are satisfactory as the metric for homogeneity is challenged by analyzing data of previous years to discover the characteristics of bonds that are priced differently from the market. The influences include: differences between S & P and MoodyEs ratings, differences in rating of bond and of the company issuing the bond, the coupon on the bond and whether bond is new or traded for more than a year.

United States, Financial Services, Finance and Insurance, DEPOSITORY INSTITUTIONS, Services information, Security brokers and dealers, Securities & Commodities Services, Securities, Commodity Contracts, and Other Financial Investments and Related Activities, Financial services industry, Services, Securities industry, Comparative analysis, Financial analysis, Standard & Poor's Corp., Moody's Investor Service

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Modern portfolio theory, 1950 to date

Article Abstract:

A review of modern portfolio theory was conducted through consideration of various works written on the said topic, such as 'Modern Portfolio Theory and Investment Analysis'. Part of the review includes analysis of its history and major inputs needed to achieve portfolio optimization. Particular problems encountered during implementation of portfolio theory to financial firms and ways of evaluating the effectiveness of managing portfolio were also analyzed.

Portfolio Management, Models, Finance, Investment analysis, Securities analysis

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Optimal investment strategies with investor liabilities

Article Abstract:

Insurance portfolio combination will be optimal if it includes liabilities and focus on net worth. An analysis of duration matched, cash flow matched and active portfolios shows that an immunized portfolio that is not cash flow matched is disadvantageous to the beneficiary. However, if assets offer an above equilibrium return, it is practical to have a duration matched portfolio.

Research, Analysis, Financial planning, Portfolio insurance

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