CHAPTER 2 Asset Classes and Financial Instruments
Major Classes of Financial Assets or Securities
Money market instruments Bond market securities Equity Securities Stock market indexes Derivative markets
The Money Market
Sub-sector of fixed income mark
1. 796 funds were missing their net asset values
2. Net asset values are important to both mutual funds and ETF
because it dictates the shareholders equity. NAV is the companies
assets minus its liabilities.
3. The breakdown makes ETF more costly to
Homework 12 Due Thursday, October 1, 2015 6:00 PM
Ch.3, Problems 7, 8, 9, 10 pg 88; Excel Questions1 &2,pg78
7) Initial margin was 50% of the share value (1000 shares x $40/share) = .50 x 1000 x $40 = $20,000
a) The loss from price change i
Ch7, Problems 1, 2, 3 pg235;
CFA problems 4,5, 9, 10, 11 pgs 238-240
1. Both A & E. Short term rates and labor issues are factors that generally affect all firms
and thus must be considered market risk factors.
2. Both A & C. The portfolio now includ
The cost of an irreversible investment cannot be recovered once it is installed.
restriction not only truncates negative investments, but also raises the threshold for positive
investment. With uncertainty, the threshold return that justies
WASHINGTON - A federal appeals court, based in San Francisco, is set to rule as soon as this week on
President Donald Trump's executive order on immigration in a decision that may have more influence -and last longer - than usual because of the longstandi
The top six U.S. banks could potentially return over $100 billion to investors in dividends and stock
buybacks if Trump succeeds in easing regulations.
Republicans in Congress are set to release plans to roll back the Dodd-Frank law as early as this week.
1. Nearly 80% of trading halts were exchange-traded funds (ETF)
2. If there are is high volatility in the market trading halts can make
more problems because investors don't know how to correctly price the
stock. Also it leads to investors panicking