A stock option is a derivative security, because the value of
the option is derived from the value of the underlying
There are two basic option types.
Call options are options to buy the underlying
Security Analysis: Be Careful Out There
Fundamental analysis is a term for studying a companys
accounting statements and other financial and economic
information to estimate the economic value of a companys
The basic idea is to iden
Diversification and Risky
Intuitively, we all know that if you hold many
Through time, some will increase in value
Through time, some will decrease in value
It is unlikely that their values will all change i
Price quotes for all types of investments are
easy to find, but what do they mean?
Learn the answers for:
1. Various types of interest-bearing assets.
2. Equity securities.
3. Futures contracts.
4. Option contracts.
each security type, we will exa
to calculate the return on an investment using different
historical returns on various important types of
historical risk on various important types of
relationship between risk and return.
You can retire
Stock Price Behavior
The efficient market hypothesis (EMH) is a theory that asserts: As a
practical matter, the major financial markets reflect all relevant
information at a given time.
Evaluate risk-adjusted investment performance
Assess and manager risks involved with
specific investment strategies
Performance evaluation is a term for
assessing how well a money manager achiev
The Investment Process
Dont sell yourself short. Instead, learn about these key investment
1. The importance of an investment policy statement.
2. The various types of securities brokers and brokerage
Return, Risk, and the
Security Market Line
In this chapter, we define risk more
precisely and discuss how to measure risk.
In addition, we quantify the relation
between risk and return in financial
The return on any stock tra
Writing Call Options
Call Writer (Seller):
Obligated to sell stock at the options strike
price if the buyer decides to exercise call option
Price of the option (premium) is a cash inflow
Any payoff would be a cash outflow
(18 points total) The following information is available concerning stocks A and B. In
addition, you know that the expected market return (krn) is 14%, and the risk free rate of
return (krf) is 6%.
Chapter 1- Introduction to Financial Management
Basic Areas of Finance:
1. Corporate Finance- Business Finance
2. Investments- Work with financial assets (Stocks & Bonds). Deals with the value of financial
assets, risk vs. return, and a
9:30 - 10:45
You are paying 4% on a mortgage with an unpaid balance of $48,000 with 48 months to pay.
You can refinance this loan at 2%. Refinancing would require $480 in settlement fees
and two points, 2% o
For year ended December 31 2015
Allowance for doubtful accounts
Toatal current assets
Land and other investment
For year end December 31 2015
Bad debt expenses
office and adminstrative expenses
Sales salaries and expenses
For year ended at December 31 2015
other current assets
Total current assets
Property plant and equipment net
other non current assets
Total non current assets
Solutions to systems of linear equations using elementary row operations
Interchange of two rows.
Multiplication of a row by a nonzero scalar.
Addition of a nonzero multiple of one row to another row.
Given the following systems of linear equation
One Period Forecasting
Simple Percent of Sales (POS) forecasting
POS forecasts are based upon the relationship between the various financial variables and sales. One simple
forecast assumes that all assets, current liabilities (except notes payable), and
Name: Zhe Yang
Given the following 12/31 balances for 20X0 and the additional forcasting information, use the
simple percent of sales method to forecast the 12/31 balances for the next periods. Arrange the
accounts: assets first, most curr
Statement of Cash Flows
1 ABC Corp
2011 2012 2013 2014
Statement of Free Cash Flows
period ended 12/31/2014
period ended 12/31/2014
133 134 141 146
Other Current Liabilit
The monthly payment for the mortgage on this house would be $2,531.57. If I could only afford
a monthly mortgage payment of $3,400 per month, I would still purchase this house because the
payment is only $2,531.
Assessment #2 (due on October 24, 2013)
Q. Use different financial resources such as Yahoo Finance, Federal Reserve Bank website, MSN
Money, CNN Money etc. and collect the following information:
Yield on: Treasury bills, Federal Funds rate, Treasury Notes
The hawk-dove antithesis was a popular way of labeling people with different
views in the Vietnam war debate. The term dove was someone who was against the use
of military pressure to resolve something. The term hawk favored
There were many styles of music, traditions, events and attitudes, in the period of
1960 to 1975, which have impacted my life. The main huge impression that moves me
the most would have to be the music. There is so many different s
Dakota is a black and tan Heeler/Shepherd mix.
She is 5-years old and weighs about 50 pounds.
She is not aggressive and is very friendly with people.
Please call day or night (123) 456-7890.
Take Note Paperie is a new small sized custom printing service located in an upscale
neighborhood on the west side of Conway, AR. Take Notes focus will be on creating custom,
quality products for its customers. This focus will not only k
Derek Rosbrugh, Director of Human Resources
From: Nick Spring, Training Coordinator
Date: February 12, 2012
Upcoming certification exam
As per your request, the employees from departments listed below have earned continuing