When dumb money chases a dead cat bounce, and other investment jargon explained

  • 📰 globebusiness
  • ⏱ Reading Time:
  • 72 sec. here
  • 6 min. at publisher
  • 📊 Quality Score:
  • News: 42%
  • Publisher: 66%

Adveditorial News

Globe Advisor,Appwebview,Advisor-Noregwall

Investing has its share of slang, and it’s often up to advisors to translate it when communicating with clients

Every industry uses jargon that leaves outsiders scratching their heads. Investors may be among the worst offenders.

Despite pressure for advisors to communicate with clients more clearly, industry slang can be hard to shake. We asked advisors to share the investment jargon they hear most – and sometimes catch themselves using. Here are 10 of those terms, explained.Most of us have heard the term “alpha” to describe a high achiever who gets things done or an “alpha dog” who leads the pack. Alpha has a similar meaning in investing: it describes how much an investment return beats the benchmark.

“Beta” isn’t a term you hear as often, but it’s related to alpha. Beta is a numeric value that measures the volatility of a stock compared with the broader market. If the beta is 1.0, the stock has the same volatility as the market. If it’s more than 1.0, it’s more volatile; less than 1.0, it’s less volatile. You can see why it’s not as sexy as alpha.Pilots measure headwinds and tailwinds to help navigate an aircraft’s speed and performance.

The terms have been used a lot in recent years as market watchers predict what will happen to the economy – and, in turn, financial markets – after central banks began raising interest rates. When rates go up too quickly, it can lead to a hard landing. Now that rates are starting to fall, it appears a recession may have been avoided. However, not all market watchers are convinced.Hawks and doves have very little to do with investing, except when it comes to monetary policy.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 31. in SG

Singapore Singapore Latest News, Singapore Singapore Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Why was former media magnate Conrad Black removed from Britain’s House of Lords? Take our business quiz for the week of July 12Take our business and investing quiz to test your recall for the week ending July 12
Source: globebusiness - 🏆 31. / 66 Read more »

How one VC is investing in weight-loss drug marketPlenty of big pharma companies are betting on weight-loss drugs, including Pfizer (PFE), Novo Nordisk (NVO), and Eli Lilly (LLY). But there are plenty of...
Source: YahooFinanceCA - 🏆 47. / 63 Read more »