Stock and Company

As Chapter 10 questions, if further evidence continues to surface that capital markets do not always behave in accordance with the efficient market hypothesis, then should we reject the research that has embraced the EMH as a fundamental assumption? In this regard we can return to earlier chapters of this book in which we emphasised that theories are abstractions of reality. Capital markets are made of individuals and as such it would not (or perhaps, should not) be surprising to find that the

1. Discuss the nature of stock as an investment. Do most stockholders play large roles in the management of the firms in which they invest? Why or Why not?

“The Benefits of diversification are clear. Portfolio theory has played a crucial role in explaining the relationship between risk and return where more than one investment is held. It also enables us to identify optimal and efficient portfolios.”

In order to succeed in any business, it is extremely important to understand the stock market. In this assignment we were asked to follow the stock market continuously for four months and understand the market. The stock market is a global marketplace, where goods and services are traded in the form of equities.

2) An investor's risky portfolio is made up of individual stocks. Which of the following statements about this portfolio is true?

1. True or False: According to the CAPM, a stock's expected return is positively related to its beta.

Which classification system is available with EQS as a criteria for your screen of equities?

First, after selecting various assets and determining their monthly prices, the assets’ return is calculated. Asset return is the monthly percentage increase of the asset. Next, the expected return of the portfolio is needed. It is calculated as the weighted average of expected returns of the individual assets within the portfolio. Thereafter it is necessary to define and distinguish between correlation and covariance. Correlation is the measure of how two assets interact with one another, and it can vary between -1 and 1. A correlation of 1 indicates that the two

Systematic risk results from factors that affect all stocks. The risk of a project from the viewpoint of a well-diversified shareholder. This measure takes into account that some of the project’s risk will be diversified away as the project is combined with the firm’s other projects, and, in addition, some of the remaining risk will be diversified away by shareholders as they combine this stock with other stocks in their portfolios.” (Keown PG, 510)

Based on your review of the financial statements, suggest a key insight about the financial health of the company. Speculate on the likely reaction to the financial statements from various stakeholder groups (employee, investors, shareholders). Provide support for your rationale.

49) An investor's risky portfolio is made up of individual stocks. Which of the following statements about this portfolio is true?

d. The expected return and standard deviation will change as the portfolio mix changes.( see the assumption portfolio on the attachment).

Despite Nike playing on the large stage of sport apparel and shoes, another company is rising to the occasion, Under Armour. With growing interest and production, Under Armour is taking the fast track to becoming a big rival to the other sports companies. This group has chosen to research and analyze the stock for Under Armour. Under Armour was chosen as this group’s investment because it had high PE ratio compared to the other companies researched. Research began on October 5th 2015, with a closing price of $101.86. This group invested $10,000 at $101.86 per share, which are approximately 98 shares.

Company X is dedicated to provide customers with the highest levels of security, encourage equal opportunity, and to guarantee employees have the best training available to ensure customer satisfaction. Here at Company X we value integrity, diligence, fairness, and safety in all things. We understand no one person is the same as another, no day is the same as the rest and times are always changing. This company is committed to updating and maintaining our processes to be able to provide the best service available to our customers.

This is the risk of financial gain or loss due to exposure to movement in market prices. The four standard market risks are currency risk, equity index risk, interest rate risk and commodity risk. Currency risk is a financial risk that occurs when a financial transactions is denominated in a currency other than that of the company based currency. Equity index risk is the financial risk that has to do with the holding equity in a specific investment. The risk in equity can be measure with the standard deviation of a security price over a specific period of time. Interest rate risk is