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cheat sheet - Real assets produce goods and services They...

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Real assets produce goods and services. They can be tangible or intangible. Financial assets are claims on real estate. Risk is the chance that an unfavorable event will occur. A stock posts losses when you have plenty to eat or are starving. Efficient market..prices immedia reflect all relev info, if effic there is no under or over priced stocks, and use a passive investment strat.-buy and hold a divers portfolio(index fnd). No risk free profits(arbitrage) Dont use active strat.(mngr searches for undervalued stocks). The more analysts the more eff mkts should be. “players” include firms(net borrows), households(nt savers), govt, finc. Intermediaries. Mkt types: direct search, brokered, dealer-nasdaq,auction-nyse,amex. (INV Bnkrs(Glmn Sachs, merryl lynch, citi): Prim. Mkt: mkt which new issues of securites offered to pblic. 2ndary mkt: previously issued sec are trade among investors). Globilization-tendency tow a worldqide invst environment, and the integr of internat’l capital mkts (more the better) (ADR-purchase foreign secur. Which claim share of foreign stock). Securitization-pooling loans into
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