midterm crib sheet - pot 3 tourney buy-in 4 get even 1...

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Convertibles Callable Money Market Commercial Paper CDs Euro$ T Credit Rating Brian Clapp To calculate DFs, sum payments*DFs=PV, solve system PV(YTM)=PV(SPOT)=Price+AI Bills Notes Bonds greatest Notes Bills Bonds smallest Treasury 16%, Corporate 20% of FI Expectations: upward slope means future short rates higher than now C, Y, P, T for bonds 1 sales charges, fees, expenses 2 taxes 3 age and size 4 fund risks 5 changes in operations; 1 cash burden 2 market impact 3 buy high, sell low; 1 herding 2 overconfident 3 loss aversion; 1 ever changing behavior of market 2 top performers don’t stay on top 3 so many funds, so little time; 1 winning streak 2 already in
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Unformatted text preview: pot 3 tourney buy-in 4 get even 1 vertical tangent, 2 inefficient locus 3 rubber band; 1 market return 2 size 3 B/M 4 momentum = + * * = % MD 11 yn PVCF tPVtotal AI dDcpn nFace = + =-PV AI price P0 Div1rfirm = + g Erfirm PVGO = * % = g rre pb PVGO pb *--amt rrerfirm pb amt1rf g = * =-% NPV1 pb amt1 rrerfirm Div E1 Pb = Rre EREboy =- * =-- * = --* PE divrfirm g 1E E1 Pbrfirm g 1E 1 Pbrfirm rre Pb : =(-) +-= + MVP A B2 ABAB A2 B2 2ABAB x1 21 2 = + x2 11 2 : =-* + : = +-CML Rp Rm Rf PM Rf CAPM Ri Rf iMRM Rf = = CoviMVarM nondiv riskmkt risk = = R2 2 risktotal risk...
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