one can enter the market on the lows and sell on the highs, does not work for small investors, so it is better to simply buy and hold. Long Short Strategy: A long short strategy consists of selecting a universe of equities and ranking them according to a combined alpha factor. Given the rankings we long the top percentile and short the bottom percentile of securities once every re-balancing period. Indexing: Indexing is where an investor buys a small proportion of all the shares in a market index such as the S&P 500, or more likely, an index mutual fund or an exchange-traded fund (ETF). This can be either a passive strategy if held for long periods, or an active strategy if the index is used to enter and exit the market quickly. Developed markets vs emerging markets: Many people use developed stock markets because they are believed to be safer than emerging markets. When investing globally you have the risk of changes in currency exchange rates on top of stock market performance. Other people pick emerging markets believing the emerging markets have higher potential for GDP growth which in turn would then affect positively the share prices in those countries. Emerging stock markets can be less well-regulated than those in the developed markets increasing risks and have greater political risks associated. The most common way of investing in global markets is through funds. Pairs Trading: Pairs trade is a trading strategy that consists of identifying similar pairs of stocks and taking a linear combination of their price so that the result is a stationary time-series. We can then compute Altman_Z-score for the stationary signal and trade on the spread assuming mean reversion: short the top asset and long the bottom asset. Value vs Growth: Value investing strategy looks at the intrinsic value of a company and value investors seek stocks of companies that they believed are undervalued. Growth investment strategy looks at the growth potential of a company and when a company that has expected earning growth that is higher than companies in the same industry or the market as a whole, it will attract the growth investors who are seeking to maximize their capital gain. Be careful of value traps. This is where stocks have good P/E ratios or NAV’s (net asset values) because the stock or sector is not predicted to do well into the future by