I am a Level 1 candidate in the CFA program (I took the level 1 exam several days ago and won't know if I passed for a couple months, at which point I can call myself a level 2 candidate if I do indeed pass the exam) and a recent graduate of Washington University in St. Louis with a dual degree in economics and finance. Any views expressed on this blog are my own opinions, and are not meant to be taken as investment advice. I take no responsibility for any investing gains or losses you may incur as a result of reading/acting on these blog posts.
In the following blog posts, I will try to focus in on a few key themes that drive much of the price fluctuation in today's asset markets:
- Price bubbles and the psychology underlying them. How do you know when you are in a bubble? How can you predict whether the bubble will last and when/if it will burst? Is it possible to know when the bubble is bursting, and if so, will you have the intestinal fortitude to take a short position to profit from the sudden depreciation in prices? I am extremely interested in the irrational motives behind bubbles and their resultant crashes, and how to manuever through these financial beasts for maximum benefit.
- The fundamental structural forces that will affect future asset class price appreciation. According to the CFA curriculum, asset classes rather than the individual securities within those classes account for 90% of a portfolio's performance. It is therefore obvious that the majority of one's analysis should be directed at analyzing asset groups rather than individual assets.
- How politics and other such extraneous forces affect the markets, taking into account both the direction and the magnitude of their effects.
