Investment, an exact science

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Monograph

Identifikator:: 865521182

URN:: urn:nbn:de:zbw-retromon-48767

Document type:: Monograph

Author:: Lowenfeld, Henry

Title:: Investment, an exact science

Place of publication:: London

Publisher:: The Financial Review of Reviews

Year of publication:: 1906

Scope:: 1 Online-Ressource (X, 160 Seiten)

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter I - On investment risks

Collection:: Economics Books

11 capital for the sake of a possible profit. The purpose of this book is to supply our readers with a sound system of investment and not to encourage them to risk their capital in speculation. In the above example it will be noticed that the movements of the two stocks were of similar extent, that is to say, they both fluctuated five points, so that their width of fluctuation was identical. Now, when com paring the characteristics of different stocks, it is important to remember that stocks resemble or differ from one another in sound ness, in dividend-productiveness, and in width of fluctuation. Their limits of fluctuation constitute a very material difference between stocks ; and of two stocks, both subject to precisely the same market influence, one may rise or fall five points as the consequence of a given event, whilst the other may move only two points in response to the same influence. The safety of Capital is obtained by dividing it (1) equally among a number of sound stocks (2) of identical quality, but (3) every stock held must be subject to an entirely different market and trade influence. In selecting stocks of identical quality, the average annual fluctuations over a period of at least three years should be compared. It

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