Investments 10th edition by Bodie Kane and Marcus课后答案

Slides by Susan HineMcGraw-Hill/IrwinCopyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

Essential nature of investment Reduced current consumption Planned later consumption Real Assets Assets used to produce goods and services Financial Assets Claims on real assets

Fixed income or debt Money market instruments Bank certificates of deposit Capital market instruments Bonds Common stock or equity Derivative securities

Information Role The Google effect Consumption Timing Allocation of Risk Separation of Ownership and Management Agency Issues

Corporate Governance and Corporate Ethics Accounting Scandals Examples – Enron, Rite Aid, HealthSouth Auditors—watchdogs of the firms Analyst Scandals Arthur Andersen Sarbanes-Oxley Act Tighten the rules of corporate governance

Asset allocation Choice among broad asset classes Security selection Choice of which securities to hold within asset class Security analysis

Risk-Return Trade-Off Efficient Markets Active Management Finding mispriced securities Timing the market Passive Management No attempt to find undervalued securities No attempt to time the market Holding a highly diversified portfolio

Business Firms– net borrowers Households – net savers Governments – can be both borrowers and savers Financial Intermediaries Investment Companies Banks Insurance companies Credit unions

Investment Bankers Perform specialized services for businesses Markets in the primary market

American Depository Receipts (ADRs) Foreign securities offered in dollars Mutual funds that invest internationally Instruments and vehicles continue to develop (WEBs) Exchange Traded Funds (ETFs)

Mortgage pass-through securities Other pass-through arrangements Car, student, home equity, credit card loans Offers opportunities for investors and originators