Chapter9:PropertiesandPricingofFinancialAssets
PropertiesofFinancialAssets
1.
Moneyness:financialassetswhichareusedasamediumofexchangeorinsettlementoftransactions;money
a.
b.
c.
2.
Moneyconsistsofcurrencyandallformsofdepositsthatpermitcheckwriting
Nearmon
6.The Garcia Companys bonds have a face value of $1,000, will mature in 10 years, and
carry a coupon rate of 16 percent. Assume interest payments are made
semiannually.
a. Determine the present value of the bonds cash flows if the required rate of return
Page 1 of 8
Loan Amortization Schedule
HELP
2008 Vertex42 LLC
Loan Information
Loan Amount
Annual Interest Rate
Term of Loan in Years
First Payment Date
Payment Frequency
Compound Period
Payment Type
Monthly Payment
80,000.00
5.80%
30
1/1/2009
Monthly
Su
Chapter18:MarketsforCommonStock:StructureandOrganization
Multiproductexchangesnotonlycommonstockistradedbutalsootherfinancialinstrumentssuchasbonds,options,and
futures
Offexchangemarkets
TwofundamentaldifferencesamongUSandinternationalexchanges:
o
o
(1)Me
Chapter 15: Treasury and Agency Securities Markets
Treasury securities are issued by the U.S. Department of the Treasury and are backed by the
full faith and credit of the US government no credit risk
Market for Treasury Securities
Two factors for promin
Chapter16:MunicipalSecuritiesMarkets
Municipalsecuritiesareissuedbystateandlocalgovernmentsandbyentitiesthattheyestablish
o
Attractivenessofmunicipalsecuritiesisduetotheirtaxtreatmentatthefederalincometaxlevelmostmunicipalsecuritiesare
taxexemptintereston
Chapter 14: Secondary Markets
The secondary market is where already issued financial assets are traded
In a secondary market (unlike a primary market), the issuer of the asset does not receive funds from the buyer,
rather, the existing issue changes hands
Chapter 13: Primary Markets and the Underwriting of Securities
Primary Market: financial markets dealing with financial claims that are newly issued
o
Involves
o
The distribution to investors of newly issued securities by central governments, their agenc
The Bond Market
CHAPTER 12
Topics
Capital Market
Treasury Notes and Bonds
Municipal Bonds
Corporate Bonds
Financial Guarantees
Finding the Value
Capital Market
Capital Market
Participants
Trading
Types of Bonds
Treasury Notes and Bonds
Municipal Bonds
McDondalds
www.aboutmcdonalds.com
Investor Relations
Stock Information
What is the current dividend? If you purchased a
share today, what would the dividend yield be?
How long has McDonalds been providing dividends?
How many times has McDonalds repurchase
Interest Rates (2)
CHAPTER 04
WHY DO THEY CHANGE?
Topics
Determinants of Asset Demand
Supply and Demand in the Bond Market
Changes in Equilibrium Interest Rates
Determinants of Asset
Demand
T H EORY OF P ORT FOLI O C H OIC E
Theory of Portfolio Choice
Wea
Interest Rates (3)
CHAPTER 05
EFFECTS OF RISK AND TERM STRUCTURE
Topics
Risk Structure of Interest Rates
Term Structure of Interest Rates
Risk Structure of Interest
Rates
H O L D I N G M AT U R I T Y C O N S TA N T
Risk Structure
of Long Term Bonds in the
The Stock Market
PA R T A
P R I VAT E E Q U I T Y T O P U B L I C E Q U I T Y
Topics
Private Equity vs. Public Equity
Initial Public Offerings
Private vs. Public Equity
Private Equity
Startup companies
Financing by Venture Capital (VC) Funds
VC Market
T
The Stock Market (Part B)
S T O C K VA LU AT I O N
Stock Valuation
The Present Value of Dividends
Risk-Adjusted Required Return
Discounted Earnings or Cash Flow
Analysis of Financial Statements and Price
Multiples
The Present Value of
Dividends
O N E - P
How Does IPO Pricing Work?
Answer by Raj Bhuptani, Harvard '13, on Quora,
Raj Bhuptani
The actual mechanics of what happens are somewhat complicated, but the basic idea is simple economics: the
price is set as the number which balances supply and demand.
Econ215 Week 1Part II
Overview of the Financial
System
PolicyMakersPresident,
Congress&U.S.TreasuryFederalReserve
Board
Role:Passlaws&setfiscal&monetarypolicies
MonetarySystemFederal
ReserveCentralBankCommercial
BankingSystem
Role:Create&transfermoney
ht
Econ 215 Week 1 Part I
Name
Major
Class standing
What do you hope to learn in this class?
Importance of Financial
Markets
This is important. For example, if you save
$1,000, but there are no financial markets,
then you can earn no return on this
might as
Topic 6: Properties of the Normal distribution, Z-scores, The Central Limit
Theorem and the Distribution of X-bar
Objectives:
Know the basic properties of a normal distribution
How & why we compute the z-score (no of std deviations from expected)
What is
Topic 5: Box plots and Histograms
Objective:
The Box plot is a graphical summary of the Five-number summary
The histogram provides a graphical measure of the symmetry of the
distribution
The choice of bin width does affect the shape of the histogram
the h
Lab Activity 7
Problem
The Transportation Notes section of the Sunday Chicago Tribune (2/11/1996) reported on
a new all-season radial replacement tire called Innitred. According to the article, Goodyear
says it expects the Innitred to last more than 80; 0
Lab Activity 6
Problem
The following sample data were used to calculate an average rent of one-bedroom apartments in
Atlanta. Use a computer program to calculate a 95 percent condence interval for the average
rent of all one-bedroom apartments in Atlanta.
Lab Activity 5
Problem
In Testing the Science of Intelligence Newsweek (October 24, 1994), Geofrey Cowley reported
that IQs for a whole population can be arrayed on a single graph. Roughly two-thirds of all
Americans fall between 85 and 115, in the fat mi
Lab Activity 4
Problem
In Testing the Science of Intelligence Newsweek (October 24, 1994), Geofrey Cowley reported
that IQs for a whole population can be arrayed on a single graph. Roughly two-thirds of all
Americans fall between 85 and 115, in the fat mi
Lab Activity 3
Problem
A Washington Post syndicated article (January 29, 1995) reported on the riskiness of various
investment funds. Five sample percentage annual returns were reported for American Heritage
Mutual Fund (31, 96, 19, 41, and 35), and Valle