Capital gains tax Most jurisdictions imposing an income tax treat capital gains as part of income subject to tax. Capital gain is generally a gain on sale of capital assets—that is, those assets not held for sale in the ordinary course of business.
Asset Allocation Asset allocation refers to the division of one's investment portfolio across the various asset classes. At the highest level, this refers to a split between stocks and bonds. Many more finely defined sub-asset allocations are also common. Ian Ayres and Barry J.
This outstanding paper discusses the idea of spreading one's stock exposure more evenly across their lifetime, which should then reduce the riskiness surrounding the ending wealth. Here's an excellent website where the authors discuss this idea.
Here's the outstanding book where they elaborate in depth on this idea. This outstanding article covers the same ground as the "Diversification Across Time" paper above, but at a level which is more readable for the layperson. Randolph Hood, and Gilbert P. This was the paper which revolutionized portfolio construction by emphasizing the importance of asset allocation.
It found that, on average, Further, it found that active management resulted in an annual reduction of 1. Singer, and Gilbert P.
Bogle, " The Riddle of Performance Attribution: Vanguard's founder concludes that, while asset allocation is very important, controlling costs is also very important. Much of the advice presented to investors during periods of unusual market activity should be ignored.
It is more important to rebalance the retirement portfolio on the basis of a change in risk aversion, rather than on the conditions in the financial markets. Pragmatic advice on asset allocation. For a smaller file version, see here kb.
This paper studies the relative efficacy of various asset classes as inflation hedges. It finds that treasury bonds are a complete hedge against expected inflation.
It also finds that private residential real estate is a complete hedge against both expected and unexpected inflation.
Gibson, " A Timely Reminder: The recent market tumult offers a perfect opportunity to remember the advantages of a diversified, balanced portfolio ," Financial Planning, October An excerpt from Mr. Gibson's outstanding book, Asset Allocation: Another outstanding version of his timeless message, reprinted from its original appearance in this Journal in March This study builds on Reichenstein and Sibley papers below.
Steven Horan, " An alternative approach to after-tax valuations ," Financial Services Review, 16pp. Junkans, and Carmen M. This study reviews and revises the Brinson studies above. This study concludes that strategic asset allocation only explains about In general, we do not agree that most retirees should use such a high stock allocation unless they have a very high willingness and ability to tolerate risk.
Ibbotson and Paul D. An analysis of criticisms of the two "Determinants of Portfolio Performance" papers.A tax (from the Latin taxo) is a mandatory financial charge or some other type of levy imposed upon a taxpayer (an individual or other legal entity) by a governmental organization in order to fund various public expenditures.
A failure to pay, along with evasion of or resistance to taxation, is punishable by law. Taxes consist of direct or indirect taxes and may be paid in money or as its. Factors affecting Dividend Policy.
A company needs to analyze certain factors before framing their dividend policy. The following are the various factors/determinants that impact the dividend policy . Course Summary Finance Principles of Finance has been evaluated and recommended for 3 semester hours and may be transferred to over 2, colleges and universities.
This paper re‐examines the dividend policy issue by conducting a simultaneous test of the alternative explanations of corporate payout policy using a two‐step procedure that involves factor analysis and multiple regression. Chevron works to meet the world's growing demand for energy by exploring for oil and natural gas; refining and marketing gasoline; producing chemicals and more.
Dividend refers to the corporate net profits distributed among shareholders. Dividends can be both preference dividends and equity dividends. Preference dividends are fixed dividends paid as a percentage every year to the preference shareholders if net earnings are positive.
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