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SU1- Financial Modelling - Coggle Diagram

- - - - Analysis, evaluation
      - E.g. cost estimation, forecast, budgeting, asset valuation
  - - - Debt market- bond
      - Stock market- shares
      - Forex- currency conversion
  - - - Depository- accepts deposits e.g. commercial banks
      - Non-depository- cant accept deposits e.g. insurance companies
      - Investment- financial services, advisory, consultations, portfolio management e.g. investment banks, brokerage firm like JP Morgan
- - - - Types
        
        Real estate- purchase, rental; REITS (indirect)
        
        Hedge funds- manages money for wealthy individuals; hedge against market downturn thru short-selling
        
        Gold, precious metals
        
        Commodities- indistinguishable from other commodity of same type; used to create other products e.g. oil, gas, agricultural produces, livestock, metal
        
        Cryptocurrency- digital asset with low correlation to mainstream investment e.g. bitcoin, blockchain tech
        
        Private equity- ownership in non-listed companies
        
        Other- tradable collectibles e.g. artwork, antiques, stamps
- - - - Objective
      - Preferences
      - Risk-adjusted returns
      - Rebalancing
      - Liquidity
      - Time frame
      - Tax
    - - Active- aims to outperform market index by exploiting market mispricings (buy underpriced, sell overpriced)
      - Passive- tracks/mirrors returns of a market index/benchmark e.g. index mutual funds, ETFs
    - - Risk-adjusted returns
      - Asset allocation
      - Diversification
      - Rebalancing
  - - - Risk
      - Tax
      - Liquidity
    - - Asset budgeting
      - Investments
      - Mortgages
      - Banking services
      - Insurance
      - Retirement planning
    - - Savings
      - Spendings
      - Investing
      - Insurance
      - Retirement