ch_01 - I nvestments: A n Introduction 10e Chapter 1: An I...

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Investments: An Introduction 10e Herbert B. Mayo Chapter 1 : An Introduction to Investments
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2 Introduction of Portfolio Construction Income is either spent or saved. Savings are invested. The investments constitute a portfolio. The composition of a portfolio depends on investment goals. Not all assets are appropriate for all financial goals.
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3 Possible Investment Goals Funds to meet emergencies Funds to finance education expenses Funds to make a specified purchase (e.g., a home) Funds for retirement
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4 Preliminary Definitions Investments: lay usage v. economics Primary and secondary markets Value and valuation
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5 Preliminary Definitions Return: income and capital gains Return in monetary units and percentages
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6 Preliminary Definitions Risk: possibility of loss Uncertainty of future returns
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7 Preliminary Definitions Risk: differentiated from speculation Marketability and liquidity of an asset
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8 Diversification and
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This note was uploaded on 09/21/2011 for the course FINANCE 4320 taught by Professor Omaral-nasser during the Spring '11 term at University of Houston-Victoria.

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ch_01 - I nvestments: A n Introduction 10e Chapter 1: An I...

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