• Socially Responsible Investing

    If you ask a layperson to explain what the term “investing” means, you will most likely hear something to the effect of: “it’s when you spend money on something that is going to yield a profit later.” This definition is fairly accurate, but sometimes returns are measured in more than just money. Socially responsible investing, for example, is becoming more popular in the developed countries. So what is socially responsible (or “ethical”) investing and why has it suddenly become such a big hit?

  • Shallowing Moats: Coca-Cola's Case

    An economic moat is a widespread concept in investing, according to which companies with sustainable competitive advantages can be potentially profitable investments. A high ROIC over a long period of time indicates that a company might have an economic moat. Companies with a high but steadily declining ROIC tend to underperform the market. Coca-Cola has an economic moat, but also possesses the features mentioned above. Investors aiming mainly for capital appreciation should avoid investing in Coca-Cola, but the company could be a good choice for income investors.

  • Weight Your Holdings Carefully!

    There are different approaches to determining the weights for different stocks in an investment portfolio. We used the Monte Carlo method to figure out the most efficient approach. Markowitz implied return weights is the preferred approach if the investor can withstand a lot of volatility, while equal weights work better for more conservative investors.