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Is "Stepping number" is OK in this context? Or number of steps or step number is
sleaker
Jan 4, 2006 16:41
18 yrs ago
1 viewer *
English term

thus (in this context)

English Bus/Financial Finance (general) Fund reports
Domestic Balanced / Domestic Growth / Global Growth / Global Balanced

Seeks long-term capital appreciation ***thus*** higher
degree of market volatility

No context - one sentence regarding the above funds
Responses
4 +6 hence
4 +5 and consequently a higher degree etc.
4 +2 not for grading

Discussion

Michael Barnett Jan 5, 2006:
Well, the volatility is an intrinsic property of the stock, as is the risk. The question is, how much volatility can the investor tolerate. Once the decision is made to invest long-term, the volatility (beta) becomes much less important.
Laura Vinti (asker) Jan 5, 2006:
marceloabq has a point. What he says is what got me confused in the first place. IMO, the question is also: higher volatility compared to what? It has to be fixed -income funds, as equity funds with a short term horizon should be probably exposed to an even higher degree of volatility...
Michael Barnett Jan 5, 2006:
The issue here is NOT that greater profits require greater risk (and volatility), but that, since it is a long term investment, greater volatility is accepted, because the investment is going to be held for a long time regardless of the ups and downs.
Michael Barnett Jan 5, 2006:
I came across your question too late to answer before the question was closed. I am throwing in my interpretation, which is somewhat different from the accepted answer...
Marcelo González Jan 4, 2006:
Is the risk not less when funds seek long-term appreciation? Would the degree of market volatility not be higher when funds are designed to seek SHORT-TERM appreciation?? I'm not so sure this flows logically. Happy New Year :-)

Responses

+6
5 mins
Selected

hence

This fund seeks to achieve long-term capital appreciation, and hence there is a higher degree of market volatility. (If you don't want volatility, you have to settle for fixed interest funds, which do not have capital appreciation. This is the converse.)


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Note added at 1 hr 29 mins (2006-01-04 18:11:44 GMT)
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Another way of putting this is: higher rewards entail higher risks. You may get your higher reward, or you may fail spectacularly.

If you want to climb mountains, you have to accept the risk of falling off. In the language above: seeks to climb mountains, thus [accepts] higher risk of falling.
Peer comment(s):
agree cmwilliams (X)
5 mins
thanks!
agree Peter Skipp : whatever the word ("thus", "hence", "and consequently"), there ought to be a comma before it!
36 mins
agree!
agree Can Altinbay : Absolutely.
1 hr
agree Marina Soldati
1 hr
agree Alexander Demyanov
1 hr
agree MPGS : :)
1 hr
Something went wrong...
4 KudoZ points awarded for this answer. Comment: "Thank you so much for your very useful explanation! I was having a hard time finding the link between capital appreciation and higher volatility. Your explanation "clicked" straight away!"
+5
5 mins

and consequently a higher degree etc.

the English is a little garble here but I think this is the meaning

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Note added at 7 mins (2006-01-04 16:49:07 GMT)
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sorry ... "garbled"
Peer comment(s):
agree cmwilliams (X) : yes, .... consequently there is a higher degree.....
8 mins
thx cmwilliams :)
agree Yvonne Becker
26 mins
agree Can Altinbay : I should have said "both Davids' answers".
1 hr
agree MPGS : :)
1 hr
agree Alfa Trans (X)
12 hrs
Something went wrong...
+2
56 mins

not for grading

I don't agree that 'thus' is incorrectly used here. High market volatility is a risk that has to be accepted, rather than something that is actively sought.

You'll see from this web site, the language used is 'endured', 'prepared to accept'....

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Note added at 57 mins (2006-01-04 17:39:09 GMT)
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www.altamira.com/altamira_en/funds/categories/global equity...

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Note added at 1 day 5 hrs 31 mins (2006-01-05 22:13:09 GMT) Post-grading
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As I understand it, investing for capital growth is a more aggressive approach and therefore has more risk than other types of investment.

http://www.investopedia.com/terms/c/capitalgrowthstrategy.as...

http://www.investopedia.com/terms/a/aggressiveinvestmentstra...



Peer comment(s):
agree Can Altinbay : I'm with you on this point.
22 mins
agree MPGS : :)
56 mins
Something went wrong...
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