This paper asks a few key questions relevant for active risk parity portfolio construction. Given the dynamic nature of financial markets, especially in the aftermath of the financial crisis, we believe systematically answering these questions within a transparent conceptual framework is...

This note reviews the four central parity conditions that underlie most theories regarding the relationship between exchange rates, inflation, and interest rates. The concepts are illustrated through a unified example exploring the relation between the US dollar and the Norwegian krone. The note...