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Category Archives: Finance Concepts

How important is “Diversification” in investing?

These days, a lot of investors seem to be enamored with stocks as an investment option. This is not bad per se, but intelligent investors understand that portfolio diversification is a critical element of an overall investment strategy. About this post: pinoy diversify your savings

Top 10 Countries: GDP per capita, Gross Domestic Product

Gross Domestic Product or GDP is the market value of all final goods and services produced within a country during a certain period. This is in contrast with Gross National Product or GNP which refers to the market value of all goods and services produced

Credit Ratings by S&P, Moody’s, and Fitch Ratings

What are Credit Ratings? Credit Ratings are a measure of the credit worthiness of an organization such as a government or a public or private corporation. It is also an assessment of the quality of debt (loan) instruments issued by these institutions. In layman’s terms,

What’s with the U.S. Debt Ceiling issue?

One of the most highly controversial topics in the United States right now is the Debt Ceiling issue. Basically, U.S. lawmakers are debating whether they should increase the country’s debt ceiling and, if yes, by how much. Much of their disagreement and discussion focus on

External Debt and Public Debt as % of GDP, by country

In the United States, a highly controversial issue right now is the debt ceiling limit. The current debt ceiling of the US, set by law, is $14.3 trillion. According to the United States Treasury, this limit was reached in May 2011 and, if the limit

Subprime Mortgage 101 – A simple and funny Powerpoint

With all the buzz going on about the collapse of Lehman Brothers, the $700 billion AIG bailout plan, and the US financial crisis and its impact on Philippine banks, the word “subprime” suddenly gained notoriety in mainstream media. What exactly is the subprime mortgage problem? About

Relationship between interest rates and inflation

Whenever news regarding inflation is announced, expect succeeding reports to deal with interest rates. For example, in the Philippines, news of rising inflation rate is usually accompanied by discussions that the Bangko Sentral ng Pilipinas (Central Bank) will “raise key interest rates”. Let’s analyze how

‘Window Dressing’ – a strategy in stock trading

We usually read it in the news: Shares are expected to open higher today, supported by fund managers window dressing their portfolio before the quarter ends. What is window dressing? Window dressing is arguably a deceptive strategy employed by fund managers in which they try