Payback period is a fundamental investment appraisal technique in corporate financial management. It is a measure of how long it takes for a company to recover its initial investment in a project. It is one of the simplest capital budgeting techniques and, for this reason, is commonly used to evaluate and compare capital projects.
LDI nuts and bolts It’s hard to have escaped all the recent noise in the media about the UK’s mini budget (ironically with not-so-mini consequences!) and the repercussions through financial markets. And one of those headline consequences was pension funds being plunged into liquidity crunches due totheir LDI strategies. Again, ironically, the funds hit
It’s been a round ride for airline operators over the last 3 years. Just when you think things are re-stabilising after COVID then the energy ‘crisis’ hits the fan and fuel costs increase 3 fold! But the operators have been hedging, right? And if you’re hedging then you’re eliminating risk, right? If only life
Let me start by saying that in financial analysis, valuation and modelling there is no substitute for knowing your numbers! This is no doubt the case when it comes to looking at PPE. PPE is one of the core elements of any financial analysis. That link between investing in the business and growth in
Portfolio Optimisation in Excel If you would like a copy of the Excel spreadsheet containing the data and analysis below, feel free to contact Greg: Greg.m@capitalcitytraining.com It was in the summer that I blogged about my diversified portfolio – noting how my ‘random weighting’ might be as good as anything scientifically optimised, given that
I wrote the first part of this blog around 8 weeks ago and left you with some food for thought. Go back and have another quick 5-minute read if you like, but in essence I showed that a (rather spuriously) diversified portfolio that had performed very well for 35 years (1975 to 2010) had
Well, of course, there is no perfect portfolio post-pandemic, but I wanted a bit of alliteration so there it is. The closest we can get to perfection is the optimised portfolio. But optimisation is all about finding the best balance of risk and return for a portfolio of assets – and risk lies in
From the lockdown baking book of finance… Forget the lockdown sourdough baking challenge that has trended over the last year, we have seen in action this last week how to cook up the perfect storm and nearly bankrupt a hedge fund! For the home-bakers of finance out there who want some clarity on the
The Covid-19 pandemic has made it brutally clear that politicians struggle to understand simple statistics. But they are not alone – too many businesspeople are also ignorant of basic statistical methods, or accept the integrity of sources unquestioningly. Such misunderstandings can easily damage profits or growth prospects in your company, given the increasing reliance on
