Formula investing is an investment technique grounded in a predetermined timing or asset allocation model that eliminates emotional decisions from the investment process. By following a systematic, rule-based strategy, formula investing aims to mitigate the influence of market sentiment and human emotions in making investment decisions. The approach often involves specific triggers or conditions under which investments are adjusted, rebalanced, or reallocated.
Discover comprehensive accounting definitions and practical insights. Empowering students and professionals with clear and concise explanations for a better understanding of financial terms.