Archive for June, 2010

What is Skewness

Skewness is the third central movement of a distribution. The first two movements are the mean and the standard deviation. It measures the symmetry of a return distribution around its mean.

Zero skewness indicates a symmetrical distribution. Investors generally prefer higher skewness and avoid negative skewness if possible.

Posted on 12th June 2010
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Tactical Investment Style Funds

The predominant strategies within the tactical investment style are Global macro and commodity trading advisors (CTA).

The global macro strategy makes leveraged, directional, opportunistic investments in global currency, equity, bond and commodity markets on a discretionary basis. Managers usually rely on a top-down approach and base trading views on fundamental economic, political and market factors. They seek high returns with less concern over risk. Success is heavily dependent upon manager skill.

Discretionary traders base decisions on fundamental and technical analysis, and their experience. Systematic traders believe future price movements can be anticipated by quantitative analysis of historical price movements.

Posted on 3rd June 2010
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