Investment Strategies and Analysis: Rapid Fire

What this video covers

• How risk tolerance, time horizon, investment objectives, and liquidity needs form a complete profile filter, and why no single factor automatically wins when they conflict
• Why volatility must be paired with time horizon first, and how a short horizon overrides an aggressive attitude
• The difference between systematic (market) risk, which diversification cannot touch, and unsystematic (company-specific) risk, which diversification eliminates
• What beta measures against the market baseline of 1.0, and why high beta is aggressive, not bad
• How to compute CAPM expected return starting from the risk-free rate, and why alpha is actual return minus that CAPM expectation (manager skill, not raw outperformance)
• How First-In, First-Out (FIFO) and Last-In, First-Out (LIFO) flow costs to Cost of Goods Sold in rising prices, and which inflates earnings versus which saves taxes
• The 75-5-10 diversified fund test: 75% of assets diversified, 5% max per issuer, 10% max of any issuer's voting stock, with the remaining 25% unconstrained