In this article, we're going to look at what the Profitability Index formula is, how it works, and why it works the way it does. TL; DR The Profitability Index formula …
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How to Calculate Present Value
In this article, we're going to explore how to calculate Present Value. Let's get into it. TL;DR The Present Value is calculated as... $$ PV = \sum_{t=1}^n …
How to Calculate Future Value
In this article, we're going to explore how to calculate future value. Let's get into it. TL;DR The Future Value formula (for a single cash flow) is: $$ FV = CF_t(1+r)^t $$ Where …
Discounting Cash Flows Explained
In this article we're going to explore what discounting cash flows is, including what it means, how it works, and why we should even bother doing it. Let's get into it. What is discounting cash …
How to Calculate Portfolio Risk
In this article, we're going to learn how to calculate portfolio risk for a 2 asset portfolio. TL;DR Portfolio risk (for a 2 asset portfolio) can be calculated as... $$ \sigma_p = …
How to Calculate Portfolio Returns
In this article, we're going to learn how to calculate portfolio returns from scratch. TL;DR Portfolio returns can be calculated using this equation: $$ r_p = \sum_{i=1}^k \omega_i …