B230 CourseProjectWeek3_SPRING 2018.pptx

B230 CourseProjectWeek3_SPRING 2018.pptx - Savings and...

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Savings and Investments EAGLE CONSULTING: B230 PRINCIPLES OF FINANCE
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The benefits of investing in stocks: Common stockholders have a residual claim on the firm’s assets Unlimited earning potential Limited personal liabilities through litigation Stockholders are part owners of a company they have invested in Potential to earn profits via dividends that are paid out by the company
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Investing in stocks: The risks There is no guaranteed return on the investment of common stock If the company is liquidated, it is unlike that common stockholders will receive and proceeds Common stockholders have limited control over the investment. A common stockholders typically has zero input in to the day-to-day operations.
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Investing in Bonds: The Benefits Bonds offer safety of principle as well as periodic interest income, which is the product of the stated interest or coupon rate and the principle of face value of the bond
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