Harry Markowitz established Modern Portfolio Theory (MPT) and the investment concept of diversification in 1952. One of Markowitz’ doctoral students, William Sharpe, streamlined his work and developed a more accessible approach to diversification known as the Capital Asset Pricing Model
Modern Portfolio Theory (MPT) is the mathematical framework that powers the investment concept of diversification, which posits that investors can minimize the volatility of their portfolio and maximize their expected return by investing in a diversified portfolio of risky financial
M1 Finance combines the automation of a robo-advisor with the customization and control of a full-service online brokerage, and the service is free for individual investors. If you are looking to create a diversified investment portfolio, M1 Finance is nearly impossible
A budget is a summary of your income and expenses over a specified period of time. Knowing your income and expenses will allow you to make sure your hard-earned money is being put to its highest and best use. For example, maybe
Every financial decision that you make brings you closer or further away from your goals. To evaluate your financial progress over time, one useful measure to consider is your net worth. Your net worth is a measure of your overall financial
A stock market is a place where willing buyers and sellers exchange stocks. Most publicly traded companies have their stock listed on a stock market exchange, such as the New York Stock Exchange (NYSE) or the National Association of Securities Dealers
During my PhD, I’ve taught numerous classes related to personal financial planning. In these classes, I’ve noticed that many students don’t understand the financial planning process. If my students don’t understand the process, and they are enrolled in a CFP® Board registered
If I ask you what you will be doing 10 minutes from now, you can probably give me an accurate answer. But what if I ask about your plans in 10 months? It’s unlikely that you know for certain. What about 10 years
A few years ago, I provided 20 reasons to drive a 20-year old car. Thousands of people have read that post, and the only clear takeaway is that people either love or hate older vehicles. If you haven’t yet read that post,
When Vanessa and I got married, we decided to sell our Toyota Camry to help finance our financial goals. Nearly five years have passed and we are still sharing a vehicle – a decision which has greatly reduced our auto-related expenses. Of
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