Review Sheet for Exam 1

Review Sheet for Exam 1 - Stock market indexes o...

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Fin 4514 Review Sheet for Exam 1 Basic information Exams will be held in classroom during regular class time. You will need a brown scantron for the exam. There is a requirement for the calculator used in the exam, as indicated in the course syllabus. o Students must have one of the following financial calculators for use during course examinations: Texas Instruments BA II Plus (or older TI BA II) Hewlett Packard hp 10B II (or older hp 10B) No other calculator may be used during examinations. Chapters o 2 emphasis on different types of indexing method, homework and in-class exercise o 3 focus on margin account and short sales. Characteristics of short sales o 5, 6 (concepts and calculations) Format o Approximately 80% questions (conceptual questions and calculation questions, 4 points each) o Approximately 20% problems Show ALL your work Financial Instruments and Market Indexes (Chapter 2) Different types of instruments o Money market v.s. capital market
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Unformatted text preview: Stock market indexes o Price-weighted o Value-weighted o Equally-weighted o Investment implications of each type of index Margin Account and Short Sales (Chapter 3) Returns on a margin account and returns from a short sale Stock price at which a margin call may be issued. Characteristics of margin accounts and short sales History of Returns, Risk and Risk Premiums (Chapter 5) Fisher Effect o Real after tax-rate of return Holding period returns Expected rate of return and standard deviation of returns Observations of historical returns Fin 4514 Normal Distribution and VaR Risk and Risk Aversion (Chapter 6) Risk aversion, utility function, and indifference curves Dominance principle Expected return and standard deviation for a combined portfolio of a risky portfolio and the risk free asset Identification of the optimal complete portfolio on the capital allocation line...
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Review Sheet for Exam 1 - Stock market indexes o...

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