Investing & risk
Duration Translates Yield Changes into Approximate Price Changes
Use modified duration to interpret bond price sensitivity, distinguish percentage points from percent changes, and understand the limits of a linear estimate.
Financial education
L.G
Financial education & practical analysis. Publication desk.
Published articles
352 articles
Investing & risk
Convexity Explains Why Bond Price Changes Are Not Symmetric
Explore curvature in a simple bond valuation, compare equal upward and downward yield shocks, and learn why duration alone is an approximation.
Investing & risk
Call Risk Moves the Reinvestment Decision to the Issuer
Understand how early bond redemption can change cash-flow timing, why a premium matters, and how replacement income depends on future opportunities.
Investing & risk
Individual Bonds and Bond Funds Have Different Cash-Flow Structures
Compare a bond's maturity promise with a fund's continuing portfolio, and separate diversification benefits from assumptions about recovering an original investment.
Investing & risk
Price Return and Total Return Can Tell Different Stories
Learn to combine price changes and distributions consistently, avoid dividend double counting, and compare hypothetical investments using the same return definition.
Investing & risk
A Fund Distribution Does Not Create Free Wealth
Understand the mechanical relationship between fund distributions and NAV, distinguish cash receipts from gains, and avoid counting payouts twice.
Investing & risk
Average Returns and Compound Growth Are Different Calculations
See why arithmetic average returns can overstate a compounded outcome, how losses change the base, and when geometric growth is the relevant measure.
Investing & risk
Annualizing a Short Return Changes Its Scale, Not Its Evidence
Understand how a short-period return becomes an annualized number, why repetition is an assumption, and how to compare periods without inventing a forecast.
Investing & risk
Recurring Fees Reduce Both Capital and Future Compounding
Compare recurring investment costs on the same balance and return assumptions, then check what service an additional fee actually buys.
Investing & risk
A Low Expense Ratio Is Not the Same as a Low Total Cost
Map fund, adviser, platform, and trading costs to their separate charging bases, and learn to avoid both omitted costs and double counting.
Investing & risk
Comparing Index and Active Funds Requires a Common Hurdle
Compare active and index strategies using matched exposures and net results, and calculate the hypothetical gross performance needed to offset a fee difference.
Investing & risk
Tracking Difference and Tracking Error Are Not Interchangeable
Distinguish a fund's average benchmark shortfall from variability around that shortfall, and use hypothetical periodic returns to expose the difference.