Survivorship Bias
What is Survivorship Bias? Survivorship bias is a type of sample selection bias that occurs when a data set only considers “surviving” or existing observations and fails to consider observations that already ceased to exist. In finance, an example of survivorship bias is when studies on mutual fund returns only use databases that contain data...
Examples of Black Swan Events
What are Black Swan Events? In this article, we provide examples of black swan events as they relate to the financial industry. The financial markets are the context in which black swan events are most commonly referred to. In the investing world, a black swan event is an extremely negative event or happening that is...
Money Management
What is Money Management? Money management refers to the process of tracking and planning an individual or group’s use of capital. In personal and corporate finance, money management usually includes budgeting, spending, saving, and investing. Private banking financial advisors provide money management services to individual customers. Commercial banking provides money management to corporate clients. In...
Per Annum
What is Per Annum? “Per annum” is a Latin term that means annually or each year. When it comes to contracts, per annum refers to recurring obligations or those that occur each year throughout an agreement. For example, if a bank charges an interest of 3% on a loan per annum, it means that you...
How the Government Makes Money
How Does the Government Make Money? The primary way that the United States government makes money is through taxation. In Section 8 of the first article of the Constitution, the U.S. Congress is afforded the right to assign and collect taxes. There are several sources of tax revenue. The breakdown of the federal government’s tax...
