What is a Grantor Retained Annuity Trust? A grantor retained annuity trust (GRAT) is an estate planning tool used in the United States that is structured as a trust. A trust is a fiduciary agreement for one party (trustor) to maintain the rights to hold property or assets for another party (trustee) and is commonly…
What is Regret Theory? Regret theory, studied in behavioral finance, is a concept stating that investors will feel regret if a wrong decision is made and thus will consider this anticipated regret when making investment decisions. Regret theory can adversely impact an investor’s rational behavior, such as dissuading them from acting or motivating them to…
What is Rational Behavior? Rational behavior is used to describe a decision-making process that results in the optimal level of benefit, or alternatively, the maximum amount of utility. Individuals who exhibit rational behavior make decisions that provide them with the highest amount of personal satisfaction. Understanding Rational Behavior Rational behavior is the underlying assumption of…
What is a Meme Stock? A meme stock is a stock that is highly popular among retail investors on social media platforms such as Reddit, Stocktwits, Twitter, and Facebook. Understanding a Meme Stock Meme stocks are stocks with a compelling narrative that are hyped up and popularized by retail investors on social media platforms. The…
What is a Pip? A pip is a unit of measurement for price movements of currencies in foreign exchange (FX) markets. Pip stands for “percentage in point” or “price interest point.” It represents the smallest price variation that a particular exchange rate experiences based on typical FX market convention. Currency pairs are generally traded on…
What is Money Minting? Money minting refers to the process of producing coins. A mint refers to a manufacturing facility that produces coins that are used as a nation’s currency. National currencies are generally minted by a country’s central bank or through an independent mint with authorization from the central bank. Some national mints are…
What is Central Bank Digital Currency (CBDC)? Central Bank Digital Currency (CBDC) is a form of fiat currency issued by the central banks of various countries. A fiat currency is considered any form of currency that is not backed by an underlying physical commodity. This digital fiat currency is issued by central banks in token…
What is Feature Engineering? Feature engineering is the process of selecting, transforming, extracting, combining, and manipulating raw data to generate the desired variables for analysis or predictive modeling. It is a crucial step in developing a machine learning model. What is a Feature? A feature refers to one unique attribute or variable in our data…
What is AutoML? AutoML (Automated Machine Learning) is a term defining the methods, processes, and frameworks to automate some or all steps of the machine learning pipeline. It offers off-the-shelf components and tools to optimize, as well as accelerate, the machine learning process. Before jumping into AutoML, it is helpful to understand the machine learning…
