What Do You Need to Know?
To make an intelligent investment capital commitment the investor should know these things – both about the proposed investment AND about the alternatives to it:
- What alternative choices are available?
- Which have the best trade-offs between forecast-able reward and risk?
- How big a reward is realistic to expect? Why?
- How often may disappointment occur?
- How much time and capital may disappointment involve?
- How frequently may the rewards (less risks) expected be compounded?
To get answers we look to the best-informed market participants – the market-makers [MMs]. These are the