Chap001 - Chapter 1 A Brief History of Risk & Return...

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Chapter 1 Slides 1-1 Fundamentals of Investments 1-2 Example I: Who Wants To Be A Millionaire? 1-3 Example II: Who Wants To Be A Millionaire? 1-4 A Brief History of Risk and Return 1-5 Dollar Returns 1-6 Percent Returns 1-7 Example: Calculating Total Dollar and Total Percent Returns 1-8 A $1 Investment in Different Portfolios, 1926—2002 1-9 Graphic 1-10 The Historical Record: A Closer Look, I. 1-11 The Historical Record: A Closer Look, II. 1-12 The Historical Record: A Closer Look, III. 1-13 The Historical Record: A Closer Look, IV. 1-14 The Historical Record: A Closer Look, V. 1-15 Historical Average Returns 1-16 Average Annual Returns for Five Portfolios 1-17 Average Returns: The First Lesson 1-18 Average Annual Risk Premiums for Five Portfolios 1-19 Why does a Risk Premium Exist? 1-20 Return Variability: The Statistical Tools 1-21 Return Variability Review and Concepts 1-22 Frequency Distribution of Returns on Common Stocks 1-23 Example: Calculating Historical Variance and Standard Deviation 1-24 Historical Returns, Standard Deviations, and Frequency Distributions: 1926-2002 1-25 The Normal Distribution and Large Company Stock Returns 1-26 Return Variability: “Non-Normal” Days 1-27 Arithmetic Averages versus Geometric Averages 1-28 Example: Calculating a Geometric Average Return 1-29 Arithmetic Averages versus Geometric Averages 1-30 Geometric versus Arithmetic Averages 1-31 Risk and Return 1-32 Historical Risk and Return 1-33 A Look Ahead 1-34 Useful Internet Sites 1-35 Chapter Review, I. 1-36 Chapter Review, II.
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A-2 Chapter 1 Chapter Organization 1.1 Returns A. Dollar Returns B. Percentage Returns 1.2 The Historical Record A. A First Look B. A Longer Range Look C. A Closer Look 1.3 Average Returns: The First Lesson A. Calculating Average Returns B. Average Returns: The Historical Record C. Risk Premiums D. The First Lesson 1.4 Return Variability: The Second Lesson A. Frequency Distributions and Variability B. The Historical Variance and Standard Deviation C. The Historical Record D. Normal Distribution E. The Second Lesson 1.5 More on Average Returns A. Arithmetic versus Geometric Averages B. Calculating Geometric Average Returns C. Arithmetic Average Return or Geometric Average Return? 1.6 Risk and Return A. The Risk-Return Trade-off B. A Look Ahead 1.7 Summary and Conclusions Selected Web Sites cgi.money.cnn.com/tools/millionaire/millionaire.html (millionaire link) www.mhhe.com/~finance/cj3elinks (reference for the text’s finance links) finance.yahoo.com (reference for author’s favorite financial web site) www.globalfindata.com (reference for free historical financial market data) www.nyse.com (reference for the New York Stock Exchange) www.sec.gov (reference for the Securities and Exchange Commission) www.robertniles.com/stats/(reference for easy to read
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A-3 statistics review) www.stocktrak.com/cj (the text’s special stocktrak link)
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Chap001 - Chapter 1 A Brief History of Risk & Return...

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