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Investment Theory

Topics include Efficient Market Hypothesis, Capital Asset Pricing Model (CAPM), Arbitrage Pricing Theory, and investment strategies

364 Questions

What does IN PLAY mean in the stock market?

In play trading stocks are stocks that are featured in news, triggered by events such as earnings reports, company press releases, rumors of a company buyout, government reports, market analyst ratings and financial news.

This can trigger an ongoing rally in the stock price. This does not indicate a safe investment either short term or long term.

The time frame for an in-play stock is typically short term (a few days or intraday).

In-play stocks mentioned in financial news outlets get attention from investors who trade on market reaction to news, looking for News to stimulate better-than-average trading volume and move stock prices.

Good news can inflate stock prices, which can lead to intraday or subsequent sessions pullbacks. Bad news can create oversold situations that attract new investors who want to buy at low prices.

What is a feature of a Roth IRA?

There are many features of a Roth IRA. The most significant feature is that you fund a Roth IRA with money on which you pay normal income tax. When you withdraw the funds at retirement you do not pay income tax on the principal or any increase in value (e.g. interest or dividends).

What is McDonald's beta coefficient?

Standard & Poor's gives McDonald's beta as 1.32. Value Line says 0.75.

Is The rate of return most important outcome from an investment?

RoR would depend upon essentailly two forms

Is the investment considered in isolation

or It is in reference ot portfolio managment

It will further be gauged by the

Length of time in which the returns are materialised

Expenses versus revenues generated

Circulation of the inventory, if any involved

Capital budgeting techniques must be considered before making the managerial decision to go ahead with the investment

Bottom line

RoR is important but it cannot be considered in isolation. Host of other determinants shall dictate the outcomes and must be included in the planning stage

What is the objective of portfolio management and investment analysis?

to increase the values of portfolio consisting some security.

To give the optimum returns to the investor.

To give maximum return i nless risk.

Answer:

The main reason why people have professionals manage their portfolio is to leverage their expertise in order to generate maximum wealth from their investments. A well-managed portfolio will not only take care of diversification, but also allocate resources per the investor's financial objectives and appetite for risks. Besides, portfolio management makes sure there is constant monitoring of your investments. Many companies have forayed into this area of financial service. One such company is GEPL. It offers investment portfolio management services to help its clients realize their financial goals.

How would you invest fifty thousand dollars?

This would depend in your goals, timeframe and risk tolerance. For example, if your goal is to purchase a house in the next two years, you would want to avoid any investment that could fall in value (like stocks), a good place would be a bank savings account or a money market mutual fund. A thirty year old saving for her retirement 35 years away, would be more concerned with the long term rate of return and not care much about temporary losses and gains. So stocks, commodities, foreign exchange, real estate and other long term investments would be appropriate.

What do stock market points measure?

1 point = 1 dollar

The Dow Jones Industrial Average is comprised of the stocks of 30 companies and is the weighted average price of the shares of the 30 companies.

A change in the Dow of 150 points shows that the average price of the 30 companies changed by $150.

It's important to note that there is a complex equation that changes daily which is used to determine how many shares of each of the 30 companies should be used to compute the average. The equation is intended to account for mergers and stock splits that have occurred since the index originated.

What is the function of institutional investors?

These companies specialize in real estate ownership and operation for their parent investment company. They typically invest in many properties in various regions, often worth millions of dollars.

What is safer CD or money market?

This would be a question for your personal financial advisor. There are going to be pro's and con's for both venues as each persons financial situation is different. Before making a choise, follow several "potential investments" in the financial section of the newspaper for several weeks ... but even at that, in today's world it's a total guess.

What entity is considered an institutional investor?

According to investment dictionaries an encyclopedias, any organization that trades large volumes of securities is considered to be an institutional investor. The current regulations do not define an institutional investor, they however define Institutional Manager and Accredited Investor, terms that may be treated as synonyms. Institutional Investment Manager According to the regulations dealing with SEC 13F filings, an institutional investment manager is an entity that either invests in, or buys and sells, securities for its own account; or an entity that exercises investment discretion over accounts owned by any other natural person or entity. A natural person who exercises investment discretion over his or her own account is not an institutional investment manager. Entities deemed to be investment managers include: * registered investment advisors (RIAs) exercising discretion over client accounts, * banks, * broker/dealers and insurance companies that trade in their own accounts, * corporations and pension funds that manage their own investment portfolios, * investment advisors to hedge funds and mutual funds * other private (not registered) investment advisors with discretion power, * trustees of trusts that invests in, or buys and sells, securities Accredited Investor Rule 506 of Regulation D under the Securities Act of 1933 defines accredited investors to whom private placements of non-exempt securities may be made without registering the offerings with the SEC. The rule identifies these investors as: * a bank, insurance company, registered investment company (generally speaking, a mutual fund), business development company, or small business investment company; * an employee benefit plan, within the meaning of the ERISA Act, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5 million; * a charitable organization, corporation, or partnership with assets exceeding $5 million; * a director, executive officer, or general partner of the company selling the securities; * a business in which all the equity owners are accredited investors; * a natural person who has individual net worth, or joint net worth with the person's spouse, that exceeds $1 million at the time of the purchase; * a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or * a trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes.

Should you take your money out of the stock market?

The answer to this question depends on how much you have to lose and how comfortable you are with your money in the market. In a general sense no, you should not take your money out. Right now the best thing you could do for yourself, ( If you have money that you can lose, which if you didn't then you should not be investing in the market, because anything is possible.) would be to invest smart, by taking advantage of the low prices of every stock. You have probably heard the term Recession, this is not a term to be afraid of, it simply means the market is at the bottom of its cycle. One of the problems with people not being comfortable with their money in the market, is because they do not trust the government. This should not be the case. the "Great Depression" really only started, once people paniced and took all of there money out, afraid to lose what they have left, but you haven't lost any money until you take it out of the market below what you bought it at. Once people took all their money out, there was nothing to hold up the banks, and the entire market crashed. My advice would be invest smart, learn more about what your investing in, and or hold on for the ride.

If you are afraid your stock is not already at its bottom, speak to your Financial Advisor about a "Leap Put Option." as an insurance policy.

Hope that helps.

How much do servers at buffets make?

well you cant serve food if its a buffet but if your asking how much banquet servers make on average they make about $9,600 yearly

What kinds of financial investments are traded in global markets?

Mortgages and currency are traded globally. You can also trade commodities, such as gold, silver, wheat, corn and cattle in global markets.

What do you mean by investment Briefly describe the various steps involved in the investment management process?

The word investment essentially means an outlay on an asset that is capable of generating returns over a period of time. The level of investment depends on the capacities as well as the intents of the individuals or the organisations that are carrying out the investments. In many cases, it actually is influenced by the risk appetite of the investor. Generally, an investment that is more risky offers a higher return. Investments can be made in stocks of listed companies as well through initial public offering, in mutual funds, in pension funds, in insurance sector and with banks in various forms. In respect of companies, monies paid to buy out other companies as well as holding a controlling stake in other companies is classified as investments. Investments can be short term as well as long term, depending on the maturity period.

Why do people invest in the stock market?

In hopes of a rate of return that is significantly higher than fixed rates at banks. CD rates have averaged 3.5% for the past 70 years, where stocks have averaged 10.5% during the same period.

Whats the best way of investing in the stock market broker etrade scottrade ameritrade?

Do a Google search on broker commissions. Get a nice chart, one that shows the nearly free trades available. eTrade sucks, I've been with them before, and I switched to Brown&Co, which had the cheapest commissions for years. I never had a problem with Brown&Co, and I'd be with them still, except... eTrade bought them out! I just had a terrible experience with them today, and am looking for a new broker myself. They can't agree on anything when you ask 3 or 4 people the SAME question, and their web site is so full of typos that you wonder whether they care about fixing ANYTHING! I've offered to help, and they can't even agree on whether or not they would ACCEPT my help, heheheh!

What is the goal in traditional marketing?

Second, monetary gain is the goal of traditional marketing campaigns for businesses involved in selling products and services.

How do you calculate the asset beta, equally weighted asset beta and cost of capital equity for 3 given firms?

Unlevered Beta (Asset Beta) is the volatility of returns for a business, without ... In other words, it's a measure of risk and it includes the impact of a company's capital structure ... Finally, you can use this Levered Beta in the cost of equity calculation.

What describes someone's expected outcome from investing in the stock market?

Making profit from savings, describes someone's expected outcome from investing in the stock market.

Making profit from savings