BA 103 Lec 2

BA 103 Lec 2 - UGBA 103: Intro to Finance Lecture 2:...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
UGBA 103: Intro to Finance Lecture 2: (1/20/08) Stock Market Some of the trading costs are hidden Bid-ask spread is hidden Bid-Ask Spread Order goes to exchange, someone needs to be on other side of order (market maker someone in business for themselves) Quotes 2 prices: bid price (how much he is willing to buy) & ask price (how much he is willing to sell) As outsider, if you want to buy, you pay ask price, and you sell at bid price Creates a cost of trading Hidden cost because the price you would buy the stock at is higher than what you can sell Done as transactional cost As is information cost —money maker worried you know something they don’t, so protect themselves Quotes difference between bid & ask Market makers operate in competitive market Financial Statements Firm needs to explain to shareholder how company has been Quarterly and annual reports Need if you are a publicly traded company Not if partnership, LLP SEC filings Established in 1930’s Prospectus Detailed description of company, risks of investing, past financial records
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 05/11/2008 for the course UGBA 103 taught by Professor Berk during the Spring '07 term at Berkeley.

Page1 / 2

BA 103 Lec 2 - UGBA 103: Intro to Finance Lecture 2:...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online