negative relation between profitability and financial leverage that is thought to be inconsistent with the trade-off theory …Operating leverage increases profitability and reduces optimal financial leverage. Thus, operating leverage generates a …, but is commonly observed in the data. We demonstrate the effect of operating leverage on firms' profitability and …

. The adapts of the conventional generic replication method for the volatility risk is dissipative on the structure of the …

The Modern Portfolio Theory (MPT) has been the cornerstone of the asset allocation for over 40 years. In the past … aversion that translates into volatility aversion, biases financial markets toward low volatility / high extreme risk patterns …, such as the recent sub-prime crisis. The proposed Leveraged Portfolio Theory (LPT) removes the most fundamental axiom of …

addition, the model discloses that two easily measured variables, the growth rates on net worth and profitability, generate …