Portfolio Theory Discussion


Choose one of the following topics to discuss below. [ 8+ sentences ]You can start a new thread or respond to another thread.A. First half of 413 we covered portfolio theory, with the standard well diversified market portfolio being the SP500. How is the SP500 weighted and what is the largest weight(s) in the SP500? Do you think the SP500 is a good representation for the US Market? Compare the SP500 to the ETF: JOEThow is the SP500 Index different than the JOET ETFwhich do you think is a better investment and why?What is the advantage of an ETF vs Index Fund?B. Second half of 413 we spent a great deal of time covering Risk, Bonds + Derivatives. We learned how derivatives are used to hedge and speculate in risk. One instrument that tied together risk, bonds + derivatives was the CDS. This article (Links to an external site.)shows how CDS are still being used today to hedge and speculate in risk.Reflect on the article about CDSs, mortgage markets and climate change are a place for profits.Other than the CDS, which derivative did you find the most interesting and why? Does it hedge or take on risk? C. We haven’t practiced many examples of FX or currency markets(we typically save that for a 414 course), however, Bitcoin is trending right now and I’m interesting in hearing more about you thoughts on the cryptocurrency. How can Bitcoin truly be considered finite if you can now own 0.00000001 Bitcoin, aka a satoshi? There are an infinite amount of numbers between 0 and 1. The concern here is that since it is digital you can slice the coin into an infinite amount of intervals, and this is controlled by the owners of bitcoin( currently PayPal and square are buying up as much bitcoin as possible causing a rally in the coin). This disproves the theory that Bitcoin is finite, like gold, because gold is physical and there will come a point that you cannot split the atoms of gold any further. So is Bitcoin truly what it’s been sold to be or is it just another fiat currency that will be controlled by Big Tech as opposed to the Fed.

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Portfolio Theory

us market

index fund

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