Ch1 - FIN 3504 Chapter 1 Active management attempting to identify mispriced securities or to forecast broad market trends Agency problem conflicts

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FIN 3504 Chapter 1 Active management- attempting to identify mispriced securities or to forecast broad market trends Agency problem- conflicts of interest between managers and stockholders Asset allocation- allocation of an investment portfolio across broad asset classes Bundling- creation of new securities by combining primitive and derivative securities into one composite hybrid Derivative securities- securities providing payoffs that depend on the values of other assets Equity- an ownership share in a corporation Financial assets- claims on real assets or the income generated by them Financial engineering- the process of creating and designing securities with custom tailored characteristics Financial intermediaries- institutions that “connect” borrowers and lenders by accepting funds from lenders and loaning funds to borrowers Fixed-income securities (debt)- pay a specified cash flow over a specific period Globalization- tendency toward a worldwide investment environment, and
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This note was uploaded on 05/10/2010 for the course FIN 3504 taught by Professor Staff during the Fall '08 term at University of Central Florida.

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Ch1 - FIN 3504 Chapter 1 Active management attempting to identify mispriced securities or to forecast broad market trends Agency problem conflicts

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