Slides Fundamentals of Investments - Chapter 1 ppt

... dollar return = 48% of $1, 000 = $480 At the end of the year, the value of your $1, 000 investment is $1, 480.The Historical Record: A Closer Look 1 - 12 @2002 by the McGraw- Hill Companies Inc.All ... A Closer Look 1 - 11 @2002 by the McGraw- Hill Companies Inc.All rights reserved.McGraw Hill / IrwinThe Historical Record: A Closer LookFigure 1. 3 1 - 10 @2002 by the McGraw- Hill Companies ... Second Lesson 1 - 21 @2002 by the McGraw- Hill Companies Inc.All rights reserved.McGraw Hill / Irwin© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 1 - 7Work...

... Watch 3: 12 19 .Evans, F.C. (19 56). Ecosystem as the basic unit in ecology. Science 12 3: 11 27 11 28.Food and Agricultural Organisation. (19 81) . Agriculture: Towards 2000. Food and Agricul-tural ... Renement 17 46.4.3 Practicality and Application 17 7References 17 8 Chapter 7 An Assessment of Health and Sustainability of a Smallholder-Dominated Tropical Highlands Ecosystem 18 17 .1 Introduction 18 17.2 ... and Renement 15 86.3.3 .1 Community Driven 15 86.3.3.2 Researcher Proposed 15 96.3.4 Comparison of Indicator Suites 16 76.4 Discussion 17 06.4 .1 Comparison of Indicator Suites 17 06.4.2 Indicator...

... 20 years of dividends to be paid, and the current dividend is $10 . What is the value of the stock based on the constant growth rate model?()()86.243$08 .1 10 .1 1 10 .08. 10 .11 0$020=⎥⎥⎦⎤⎢⎢⎣⎡⎟⎠⎞⎜⎝⎛−−×=V ... ratio= 21. 6 × ( $1. 97 1. 153)= $49.06* Late-2000 stock price = $89.88© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin6 - 28An Analysis of the McGraw-Hill ... share of stock as the present value of all expected future dividend payments.()()() ()TkTDkDkDkDV++++++++= 1 )( 1 )3( 1 )2( 1 )1( )0(32"© 2002 by The McGraw-Hill...

... strike price of $90 expiring in three months at $500 ($5 per share)? Three months later,Case 2: $90 $0 0% -$ 500 -1 00%Case 3: $80 -$ 1, 000 -1 1. 11% -$ 500 -1 00%© 2002 by The McGraw-Hill Companies, ... rights reserved.McGraw Hill / Irwin 14 - 9Buy Shares Buy OptionProfit Return Profit ReturnCase 1: $10 0 $1, 000 11 .11 % $500 10 0%Why Options? Should you buy 10 0 IBM shares at $90 each ($9,000 ... All rights reserved.McGraw Hill / Irwin 14 - 16 Option Profits© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 14 - 30 Chapter Review Option StrategiesÎ The...

... McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 15 - 11 The Black-Scholes-Merton Option Pricing Model The Black-Scholes-Merton option pricing model states the value of a ... Hill / Irwin 15 - 13 The Black-Scholes-Merton Option Pricing Model© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 15 - 21 Measuring the Impact of Input Changes ... McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 15 - 19 Varying the Interest Rate© 2002 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw Hill / Irwin 15 - 7Put-Call...

... Co. (12 - 6)2 = 36 (5 - 11 )2 = 36 (-4 - 6)2 = 10 0 ( -1 5 - 11 )2 = 676(0 - 6)2 = 36 (10 - 11 )2 = 1 (20 - 6)2 = 19 6 (38 - 11 )2 = 729(2 - 6)2 = 16 (17 - 11 )2 = 36 384 1, 478Calculate ... stocks T-bonds (13 .70 - 12 .11 )2 = 2.53 (6.50 - 4.20)2 = 5.29(35.78 - 12 .11 )2 = 560.27 (4.52 - 4.20)2 = .10 (45 .15 - 12 .11 )2 = 1, 0 91. 64 (0.05 - 4.20)2 = 17 .22 (-8 .86 - 12 .11 )2 = ... CPI 19 62 -8 .79%6.04%2.80% 1. 33% 19 6322.72% 1. 39%3 .16 % 1. 64% 19 64 16 .43%3.87%3.59%0.97% 19 65 12 .38% 1. 00%3.98% 1. 92% 19 66 -1 0 .10 %4.79%4.93%3.46% 19 6724.04% -2 .48%4.49%3.04% 19 68 11 .04% 1. 57%5.39%4.72% 19 69 -8 .47% -4 .98%6. 81% 6.20% 19 704.00% 18 . 31% 6.70%5.57% 19 71 14.35% 11 .49%4.50%3.27% 19 72 18 .99%2.44%4.06%3. 41% 19 73 -1 4.85%3.43%6.98%8. 71% 19 74 -2 6.58%3.75%8.09% 12 .34% 19 7537.42%5.60%6.03%6.94% 19 7623.76% 15 .32%5 .15 %4.86% 19 77 -7 .38%0.45%5.28%6.70% 19 786.54% -1 .15 %7.23%9.02% 19 79 18 .59%0.37% 10 .30% 13 .29% 19 8032. 61% -0 .80% 12 .04% 12 .52% 19 81 -4 .97%2.46% 15 .23%8.92% 19 82 21. 67%44.44% 11 .27%3.83% 19 8322.57% 1. 90%8.90%3.79% 19 846 .19 % 16 .00% 10 .04%3.95% 19 85 31. 85%30.67%7.70%3.80% 19 86 18 .68%23 .13 %6 .18 % 1. 10% 19 875.22% -3 .43%5.86%4.43% 19 88 16 .58%6.83%6.73%4.42% 19 89 31. 75% 18 . 81% 8.49%4.65% 19 90 -3 .13 %7.23%7.84%6 .11 % 19 91 30.53% 18 .70%5. 71% 3.06% 19 927.62%8.54%3.57%2.90% 19 93 10 .07% 13 .59%3.08%2.75% 19 94 1. 27% -7 .55%4 .15 %2.67% 19 9537.80%25. 21% 5.64%2.54% 19 9622.74% 1. 54%5 .12 %3.32% 19 9733.43% 10 .97%5.22% 1. 70% 10 ...

... balancesheet.Figure 7 .11 Adolph Coors Company Pro Forma 19 96 Income StatementsSales growth (%) +10 % -1 0%Net sales $1, 842, 917 $1, 507,8 41 Cost of goods sold 1 (1, 200,939) (982,587)Gross profit $6 41, 978 $525,254Operating ... income $13 8,290 $ 21, 566Other income 3,868 3,868Net interest expense (10 , 518 ) (10 , 518 )Pretax income $13 1,640 $14 , 916 Income tax2(53,972)(6 ,11 6)Net income $77,668 $8,800Dividends 19 ,066 19 ,066Retained ... 4.77% 7.50% 1. 43%Return on assets (ROA) 3 .11 % 5.59% 0.67%Return on equity (ROE) 6. 21% 10 . 31% 1. 29%Book value per share (BVPS) $18 . 21 $19 .74 $17 .94Earnings per share (EPS) $1. 13 $2.03 $0.23Cash...

... predictor of what the interest rate will be. Thus, solving for the forward rate, we have (1 + r2)2 = (1 + r 1 ) (1 + f 1, 1) (1 + .07)2 = (1 + .06) (1 + f 1, 1)and the forward rate isf 1, 1 = 1. 072 /1. 06 ... .0322 1. 544%  $15 ,205.56 / $984,794.443. 315 %  2 .14 7 × 1. 544% 1  EAR  1 .03 315 2 .14 72 .14 7 1. 03344EAR  3.344%The discount is $15 ,205.56. Thus on this 17 0-day investment, you earn $15 ,205.56 ...  $10 0 (1  .032)27 42:23r Future valuePresent value 1 NYTM  2×Face valueSTRIPS price 1 2M[6]5.30724%  2 × 10 073.0 312 5 1 12 1 The price shown is rounded to the nearest thirty-secondIf...

... quality, investment-grade bonds.Speculative Grade Bond Ratings Ba1 Ba2 Ba3 11 12 13 BB+ BB BB-Low credit quality, speculative-grade bonds. B1 B2 B3 14 15 16 B+ B B-Very low credit ... Aa3 A1 3 4 5 AA AA- A+High credit quality, investment-grade bonds. A2 A3 Baa1 6 7 8 A A- BBB+Upper-medium quality, investment-grade bonds. Baa2 Baa3 9 10 BBB BBB-Lower-medium ... stronger covenant protection specified in the bond's indenture contract.8 Chapter 11 Figure 11 .1 about here.Figure 11 .1 is a Wall Street Journal bond announcement for an aircraft equipment trust...

...  $10 0,000× r/ 12 1  1 (1 r /12 )T 12 Monthly payment  $10 0,000 ×0.08 /12 1  1 (1 0.08 /12 )360 $733.77Monthly payment  $10 0,000 ×0.08 /12 1  1 (1 0.08 /12 ) 18 0 $955.66value of ... principal-only36 Chapter 13 Monthly payment Mortgage balance×r /12 1  1 (1 r /12 )T 12 Chapter 13 Mortgage-Backed SecuritiesQuestions and ProblemsReview Problems and Self-Test 1. Mortgage Payments ... A-, B-, C-, and Z-tranches assuming 10 0 PSA prepaymentsare graphed in Figure 13 .5A. Corresponding cash flows for A-, B-, C-, and Z-tranche assuming 10 0 PSA prepayments are graphed in Figure 13 .5B.CHECK...