Personal Finances and Loans Solutions » market cycle http://www.personal-finances-advisor.com Make your financial advice personalized Fri, 14 May 2010 13:47:04 +0000 en hourly 1 http://wordpress.org/?v=3.0 Consensus credit decision making /consensus-credit-decision-making/ /consensus-credit-decision-making/#comments Tue, 16 Mar 2010 17:09:16 +0000 admin http://www.personal-finances-advisor.com/?p=69 Had the airline been more precise with its employees and stated that it regarded the stock option as a different form of paycheck, perhaps my friend wouldn’t feel so resentful. The airline overstated the scope of the partnership and inflated employees’ expectations. A similar proposal may backfire in the future. The next time the labor contract is up for negotiation, employees may hold out for the money.

A partnership based on trust and mutual benefit must have open communication between partners. Openness allows people to say what is in their heart. This type of communication, while difficult for some, must be incorporated at every stage—especially at the Storm stage. Progress comes from working through conflicts. And in order to resolve conflicts, people need to work collaboratively. The purpose of using a consensus style of decision making is to create win-win scenarios.

By using some basic guidelines for consensus decision making, people embrace the technique because it ultimately enlists the enthusiasm of the whole team.

]]> /consensus-credit-decision-making/feed/ 0 Credit status will persist as hard evidence /credit-status-will-persist-as-hard-evidence/ /credit-status-will-persist-as-hard-evidence/#comments Sat, 21 Nov 2009 19:54:05 +0000 admin http://www.personal-finances-advisor.com/?p=64 123Aggregate financial ratios give a reliable picture of the state of the highyield market and should not be neglected irrespective of technical factors. Technical factors driving the high-yield market can change fairly quickly but credit status will persist as hard evidence and change only slowly over time. The most important fundamental measures are:

  • Free cash flow generation
  • Refinancing calendar
  • Access to capital markets (bank lending standards)
  • Reported earnings and earnings outlook
  • Equity performance
  • Growth prospects
  • CAPEX needs
  • Leverage trend
  • Coverage trend.

Leverage and coverage ratios are particularly important for the analysis of high-yield issuers. We find significant correlations between the spread levels of selected high-yield issuers and their coverage ratios and their leverage ratios.

]]> /credit-status-will-persist-as-hard-evidence/feed/ 0 The flows of pension funds and payday loans /the-flows-of-pension-funds-and-payday-loans/ /the-flows-of-pension-funds-and-payday-loans/#comments Wed, 11 Nov 2009 11:17:34 +0000 admin http://www.personal-finances-advisor.com/?p=61 98Fund flows measure the amount of money that comes into or leaves the open-ended mutual funds during a given period. Coupon payments are not included. The flows of pension funds, hedge funds and insurance companies are not tracked in this number. Nevertheless, there is a high correlation between high-yield market total returns and mutual fund flows. The reason is that mutual funds account for a big part of secondary trading.

During a period of high market uncertainty and increasing negative event risks the correlation with equity markets tends to rise. Fund flows in the high-yield market are directly related to the developments in the equity market.

Fund Flows are a function of:

  • Expected risk
  • Interest rates
  • Inflation
  • Default rates
  • Economic outlook
  • Event risk
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