Adverse Selection – Understanding its Impacts and Solutions What is Adverse Selection? Adverse selection is a phenomenon that occurs in the insurance industry when policyholders with higher risks are more likely to purchase insurance policies compared to those with lower risks. This situation arises due to the asymmetric information possessed by the buyer and the… Continue reading Adverse Selection : Unveiling the Intricacies and Impact

Volatility Skew – Understanding the Concept and Its Implications In financial markets, volatility skew refers to the uneven distribution of implied volatility across different option strike prices. It is a measure of the market’s perception of potential risks and future price movements. Understanding volatility skew is crucial for option traders and investors as it provides… Continue reading Volatility Skew

The top trends in corporate social responsibility are sustainability, employee engagement, and stakeholder collaboration. Corporate social responsibility (CSR) has become an integral part of business strategy, with companies focusing on sustainable practices, involving employees in CSR initiatives, and collaborating with stakeholders to drive positive social and environmental impact. As awareness and concern about social and… Continue reading What Are Top Trends in Corporate Social Responsibility?

When interest rates decrease, bond prices rise. This is because existing bonds offer a higher yield compared to new ones. Investors often seek safe and stable investment options, and bonds are considered a secure choice. Understanding what causes bond prices to rise is crucial for investors and financial professionals. Factors such as changes in interest… Continue reading What Causes Bonds Price Rise

Interest rates directly impact mutual funds by influencing the cost of borrowing, which affects the fund’s returns and overall performance. Mutual funds typically invest in various financial instruments, such as bonds and loans, and changes in interest rates can affect the value of these investments. When interest rates rise, bond prices typically fall, leading to… Continue reading How Do Interest Rates Affect Mutual Funds?