Merits of a simple policy

Article Abstract:

A college at Cambridge University, England, has carried out a successful investment strategy since 1953 of focusing on the long term, canging the portfolio annually. Administrative costs are reduced, and no outside advice has been paid for. This policy was changed in 1997 due to concerns that stock prices had risen to unjustifiable levels. The changes made included selling 25% of the college's equities, and using call options. Stock prices rose, rather than fell, and the portfolio did not do as well as it would have if the traditional policy had been used. The portfolio still performed well, and there will be some modifications in 1998 due to an even greater risk that stock prices could fall.

Colleges & Universities, Colleges, Universities, and Professional Schools, Colleges and universities, Finance, Universities and colleges, University of Cambridge

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How to quantify investment risk

Article Abstract:

Investors have to balance risk and returns, and higher risks tend to involve higher potential returns. Risk usually involves volatility, and volatile investments tend to be more appropriate for long-term investors. William Sharpe is an economist who has studied this issue, and his Sharpe ratio measures an investment's risk efficiency, or its performance adjusted for risk. A comparison of asset classes using his methods shows that equities offer better value than government securities.

Risk (Economics)

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Risk is the price of investment freedom

Article Abstract:

The performance of ethical investments and investment funds is examined in detail.

Socially responsible investments

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