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2024/10/18
FedWatch is a tool developed by the Chicago Mercantile Exchange (CME) to predict the probability of future rate hikes or cuts by the Federal Reserve. It calculates these probabilities based on the prices of "30-day Federal Funds" futures, offering insights into market expectations. The tool provides both short-term and long-term interest rate forecasts and includes the Fed officials’ dot plot to help analyze policy direction. With these features, investors can adjust their strategies in line with market expectations, preparing for potential rate changes in advance.
# Financial Tools
# Beginners Guide
# Financial Lessons
# Macroeconomics
# USA
# Central Bank
# Federal Reserve
Gold has a wide range of uses, including jewelry, industrial applications, central bank reserves, and private investment. Its strong hedging characteristics make it particularly appealing to investors as a store of value, especially during periods of inflation and economic instability. There are various ways to invest in gold, ranging from physical gold to gold ETFs, such as Yuanta S&P GSCI Gold ER Futures ETF (00635U) and SPDR Gold ETF (GLD).
# Financial Products
# Investment
Recent volatility in global stock markets has intensified due to the Bank of Japan's interest rate hike, primarily driven by the yen's appreciation and the unwinding of large-scale carry trades. In a carry trade, investors borrow low-interest yen and invest in higher-yield assets like U.S. Treasuries or U.S. equities to earn a yield differential. However, the Bank of Japan's rate hike has pushed up the yen’s exchange rate, increasing both currency and liquidity risks. This has prompted investors to swiftly unwind their positions to repay yen loans, creating selling pressure in the market. This shift has reduced the attractiveness of carry trades and impacted market liquidity.
# Trading
# Japan
# Bank of Japan
# Monetary Policy
# Investment Strategy
Nvidia's 1-for-10 stock split attracted market attention by making the stock more accessible to a broader range of investors. A stock split is a way to restructure a company's shares, adjusting the price per share while altering the total number of shares without changing the company's total market capitalization. Stock splits can be either forward or reverse. Forward splits reduce the share price, increase liquidity, and attract more investors, and reverse splits works vice versa. Although a stock split does not affect the company's intrinsic value, it can influence market psychology and investor behavior.
# Stocks
ROA and ROE are indicators, as they help assess a company’s long-term investment value. ROA (Return on Assets) reflects how efficiently a company uses its assets, showing how well the business converts assets into profits over a specific period. ROE (Return on Equity) measures a company’s ability to generate returns for shareholders, indicating how efficiently the company uses shareholders' capital to make profits. Both ROA and ROE are useful for comparing companies within the same industry, revealing management capability and long-term trend shifts.
# Fundamental Analysis
A narrow-based security index refers to an index dominated by a small number of constituent stocks, leading to a higher concentration. According to the U.S. Commodity Futures Trading Commission (CFTC), an index is considered narrow-based if it meets any of the following criteria: it has fewer than 9 constituent stocks, a single stock accounts for more than 30%, or the top 5 stocks together exceed 60% of the total index weight. In contrast, a broad-based index has a larger number of constituents and covers a wider market scope. Recently, due to the rise in TSMC's stock price, the Taiwan Stock Exchange Weighted Index (TAIEX) has been reclassified as a narrow-based index, drawing significant market attention.
Enron was an energy company once hailed as the most innovative company in the U.S. However, as its business expanded, Enron began using "mark-to-market" accounting and set up Special Purpose Entities (SPEs) to hide debt and manipulate its financial statements. This manipulation made the company's financial health appear strong, causing its stock price to soar, while in reality, it faced serious financial difficulties. In 2001, Enron's financial practices came under scrutiny, leading to its bankruptcy. In the aftermath of the Enron scandal, the U.S. passed the Sarbanes-Oxley Act to strengthen financial regulation and revised accounting standards.
# Investment Analysis
The Statement of Cash Flows is one of the three main financial statements in a company's financial reports, providing insight into the actual cash movement within a company. This report helps investors assess the company's cash flow and financial stability by showing the inflows and outflows of cash. The cash flow statement is divided into three main sections: operating cash flow, investing cash flow, and financing cash flow. These figures help investors understand how a company manages its operations, investments, and financing activities.
The Price to Earnings Ratio (P/E) is a key tool used by investors to evaluate a stock’s value. This article introduces the basic concept of the P/E ratio, its calculation, and its application in investment decisions. The P/E ratio reflects the market’s expectations of a company’s growth and provides a sense of how long it might take for an investor to recover their investment through earnings. It is useful for comparing a company’s valuation against its peers. This article also uses Nan Ya PCB Corporation as a case study, showing how PE ratio fluctuates with market expectations.
The balance sheet, also known as the statement of financial position, is a key tool for understanding a company's financial health. Its basic formula is "Assets = Liabilities + Equity," which helps investors understand where a company's funding comes from and how it is utilized. This article also introduce assets, liabilities, and equity categories and samples in detail respectively.
# Asset Management
