Value Stock Versus Growth Stock Essay Example | Topics and Well Written Essays - 1500 words

Value Stock Versus Growth Stock - Essay Example In real world, there are more risks involved than just one of type of risk. Market sensitivity is an important risk but that cannot alone be used in order to compute the intrinsic value of stocks and hence by relying on only this type of risk, we are actually making the things more simple than they really are and not accounting for important risk elements which lead to faulty analysis and intrinsic value determination of stocks. This can lead to poor decision making and by relying just on Capital Asset Pricing model, investors stand a chance of losing their hard earned money because they are not account for all types of risk that should be included in their investment. All of this debate shows that investors should not just pick the blue chip stock but also first try to classify stocks into value or growth stocks and then create a portfolio on the basis of a strategy called â€Å"Dogs of the Dow† and keep on making structural changes to their portfolios based on the results an nounce. This way they are not only diversifying, but also upgrading the return on their investments. 2) There are several factors that account for Risk and Returns according French and Fama. Risks are basically of three types. The first type of risk is beta or market volatility. The second type of risk is investing in small versus big stocks, and the final type of risk is investing in growth versus value stocks. The reason why these factors are considered is because these are three main alternatives investment strategies that an investor can choose. Investor can invest either in stocks which have high beta or low beta. However, this decision will be made according to the expectation of the investor. If the investor is expecting the market to fall then negative correlation with market in a stock would be preferred. However, if the investor thinks that the market is going to climb upwards then it is better for the investor to invest in stock having a positive correlation with the mark et. In either case, the investor is speculating market to perform either way. If the investor chooses to invest in large company, then there are chances that the growth of these stocks would be much less than a new aggressive company. Hence, the investor would not be able to make quick capital gain in these stocks, but stream of income in the form of dividends would be quite high if the investor chooses to invest in a stock of a large company. Similarly, if the investor chooses to invest in the value stock there are chances that the investor would earn high returns, but there are also chances that the investor would not be able to earn any return on these stock. This is in line with Warren Buffets’s and EMH investment theories which state â€Å"Buy the sells and sell the buys† . The fundamental behind this theory is the fact that stocks which have never performed in the past will perform in the future whereas stocks which have performed well in the past will not be per forming as brilliantly as they have done before. Hence, it is better to buy stocks of companies which are relatively lagging behind the blue chip stocks. In other words it is better to buy the dogs of today than stars of the past. 3) Capital Assets pricing model is based on just one facet of the risk return model. This risk is represented by beta and can be explained as stock

ASPECT OF COMPLIANCE TO TREATMENT IN RELATION TO THE DIAGNOSIS OF TYPE Essay

ASPECT OF COMPLIANCE TO TREATMENT IN RELATION TO THE DIAGNOSIS OF TYPE 2 DIABETES - Essay Example The present era witnesses a great deal of stress in every aspect of life. This results in increased incidence of hypertension, or cardiovascular diseases (CVD). Stress also induces dyslipidaemia and diabetes. Research and various clinical findings formulate that appropriate treatment is essential to decrease the incidence of morbidity and mortality happening due to all these ailments. It is essential to understand that all these conditions require lifelong treatment. Compliance with medicine is most essential to procure health benefits and to curtail the forthcoming consequences in terms of economic burden, wastage of time and money and other associated diseases with these ailments (Putzer, 2004). The present era witness a remarkable mount in occurrence and pervasiveness of type 2 diabetes in both pediatric and adult groups due to outbreak of overweight resulting in obesity, sedentary life style, resistance towards insulin and other metabolic conditions. It is therefore imperative to screen patients who show high-risk for diabetes and pre-diabetes. This step not only ensures on time diagnosis and exact classification but also ensures rapid onset of treatment and hence decreased risk for complications (Putzer, 2004). In order to avoid these complications it is essential that lifestyle modifications encompassing, modifications in diet, loss of weight and an appropriate schedule of physical exercise to sustain glycemic control. When these interventions fail then oral anti-diabetic agents are added as a part of regimen. It is established that type 2 diabetes cases require insulin therapy. When insulin or its analog is administered, there is a decrease in hypoglycemia. In severe cases when oral agents are also not able to procure enough control over the glycemic index, insulin therapy is given (Putzer, 2004). The situation