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From The Archives: Leverage, The Efficient Market Hypothesis, and Emergency Funds
Lets Talk About Leverage -Leverage allows you to use a small amount of your own money to make an investment that you expect to increase in value. In that way, leverage can increase your buying power and give you control of potentially valuable assets.
What is the Efficient Market Hypothesis? -EMH suggests that the army of analysts and fund managers whose job is to actively manage portfolios are engaged in a futile exercise because everything they find out is rapidly transmitted around the market, and share prices instantly reflect the common knowledge.
Do You Need an Emergency Fund? -We typically hear that everyone should have an emergency fund equal to three to six months (or more) worth of basic living expenses. But, do you really need such an emergency fund? I’m not sure you do.
Written by Clint · October 8, 2007 · Filed Under Archives
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