Arbitrage

    Page 3 of 8 - About 72 Essays
  • Adaptive Market Hypothesis Essay

    portfolio wisely selected. An investor cannot earn abnormal profit by using information relevant to the stock. Even professional investors are unable to outperform the market (Shiller (2015), p.197). The concept of the EMH is that if there were any arbitrage opportunities available, they would already be taken as there are constantly active managers searching for mispriced stocks, which in the end results in the markets being efficient. This theory assumes that all investors act form rational…

    Words: 1001 - Pages: 5
  • Market Anomalies Essay

    Behavioral Aspects of Market Anomalies Anomaly is defined as ‘something that deviates from what is standard, normal, or expected’ by Oxford dictionary (2016). George and Elton (2001) has defined market anomaly as a new or unexpected phenomenon in relation to any theory, model or hypothesis. The founder of behavioural finance, Tversky and Kahneman (1986), suggested that the market anomalies are the indicators of inefficient markets, which might either occur only once and disappear, or occur…

    Words: 726 - Pages: 3
  • Barings Bank Case Study

    There are no limitations on the transaction. Barings don't set limits for proprietary positions Leeson because it felt did not bear the risk of the market to arbitrage deals. Indeed arbitrage deals only terpapari very little market risk, but such transactionscontain risks and settlement risks basis. The basic risk occurs if the prices in the two markets do not always move together or with the same rate, whereas the settlement…

    Words: 1619 - Pages: 7
  • An Analysis Of Merton's Intertemporal Capital Asset Pricing Model

    The investor 's objective is to maximize the portfolio 's expected return, subject to an acceptable level of risk (or minimize risk, subject to an acceptable expected return). The assumption of a single time period, coupled with assumptions about the investor 's attitude toward risk, allows risk to be measured by the variance (or standard deviation) of the portfolio 's return. Thus, as indicated by the arrow in Figure 1, the investor is trying to go as far northwest as possible. As securities…

    Words: 1070 - Pages: 4
  • To Build The Tower Analysis

    In “To Build the Tower”, Glissant offers his own take of the myth of the tower of Babel. His goal is to argue that “It is possible to build the Tower-in every language,” (109), which he does so by arguing the importance of regarding other languages. The relationships between languages have BLAH. Glissant explores the history of the relationship of the world’s languages. The idea that you either “Live in seclusion or open up to the other,” (103) was what legitimized language domination in history…

    Words: 1256 - Pages: 6
  • Copula Function Approach

    Li (2000) introduced copula function approach in the aspect of evaluating credit derivatives, the copula function has gradually become the main approach in pricing CDO (Burtschell & George, 2005). In Li (2000) paper, a new random variable named ‘time-until-default’ was created to demonstrate survival time of each defaultable entity. And the copula function approach is based on this random variable to evaluate the default probability of financial instruments. Specifically, copula function specify…

    Words: 1169 - Pages: 5
  • How Did George Soros Influence The World

    family went to England, where he attended the London School of Economics as he worked as a railway porter and waiter. Later on after his graduation, he joined the London brokerage firm Singer and Friedlander, and became adept in international arbitrage. However, he later moved to New York, where he established himself by trading on Wall Street. Due to his influence, George Soros rose to the position of New York Hedge fund manager hence becoming one of the most powerful…

    Words: 431 - Pages: 2
  • Post-Earnings-Announcement Drift (PEAD)

    flaws explanation, arguing that, since the cause of the drift is investor’s naivety, arbitragers should eliminate the effect over time, enforcing efficient markets in the long run. However, Schleifer and Vishny (1997) identified that real world arbitrage is risky and argue that this risk combined with high transaction costs impede arbitrageurs. Such hypothesis explains why the drift has been so consistent over the years further imposing doubts regarding the market efficiency…

    Words: 1319 - Pages: 6
  • Quantum Fund Case Study

    Introduction The European Union – EU consists of 28 countries that participates in the world economy as one economic unit and partly operates under one official currency, the euro. England is one of the biggest members; however, instead of adopting the euro, they still keep pound sterling as their official currency. One of the reasons for keeping the pound can certainly be found in British pound attack in 1992 and Quantum fund is blame as the culprit. This paper contains 4 chapters which are…

    Words: 1487 - Pages: 6
  • Failure Of The League Of Nations Essay

    The League of Nations was borne out of collective desire of the nations around the world to prevent war, promote world peace and stability. Not to mention, the unprecedented destruction and death caused by World War I spurred the victorious nations into establishing a system of collective security in the form of League of Nations. The primary motive of the League of Nations was to prevent/deter or address any aggression by a state through collective response from other states, thereby ensuring…

    Words: 1731 - Pages: 7
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