Tag: portfolio diversification
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Busting Financial Fears: Unmasking the Rare Disaster Theory
If you’ve ever found yourself going through lengths to protect your assets from an unlikely catastrophe, you’ve likely encountered what economists call the ‘Rare Disaster Theory.’ But what is it, and how does it impact our financial decision-making? What is the Rare Disaster Theory? The Rare Disaster Theory is an economic principle that suggests individuals…
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Understanding the Behavior Gap with Respect to Beta in Financial Markets
Investing in financial markets can be a complex and challenging task, requiring knowledge of various financial instruments, strategies, and theories. One of the most critical aspects of investing is understanding the behavior gap, which refers to the difference between the returns that investors achieve and the theoretical returns that they could have obtained if they…