1. UNIT 1. MONEY & INCOME
I. Money
a. History of money
- a mean of barter
- coins
- paper money
- plastic money: credit card, traveler‟s check
b. 4 functions of money
- medium of exchange: a mean of payment & itspeeds up the buying & selling process.
- store of value: money allows us to save/accumulate the property/wealth
- units of account: money is used for measuringthe relative worth of goods & services.
- standard of deferred payment: money is used asa means of valuing future receipt in loan
contract.
c. 4 characteristics of money
- recognizable: in the form of standard (coins orpapers)
- durable: lasting the quality of money.
- portable: easily to be transferred between the buyer & seller.
- divisible: nomination
d. the liquidity of money
- money assets: instant assets → to arrange for exchanging goods & services.
- real assets: land, houses, apartments → lowliquidity.
- paper assets: bonds, stocks → low liquidity.
Money can be used directly/quickly in the market
e. currency/money/cash
Currency
Money
Cash

2. -
coins &
banknotes
-
-
medium of
exchange
- currency on
hand
-
money supply
exchange
-
money market
- foreign
-
monetary
currency
exchange
policy: tight or
market
loose
- convertible
currency
II. Personal finance
Income
Outgoings
- salary/wage
- living expenses
- overtime
- bills
- commission
- rent
- bonus
- mortgage
- fees
- health insurance
- social security
- tax
- a pension
UNIT 2. BUSINESS FINANCE
I.
Capital
- capital structure:
+ debt financing:
* borrow from banks
* short – term debts → interest rates

3. + equity financing:
* issue stocks → investors buy stocks → share
-holders (AGM: annual general meeting)
share dividends; membership & management
- assets versus liabilities
II.
Revenue
- money coming from business in a given period of time.
- profit = revenue - expenses
- profit
dividends for shareholders
tax for government
retain for future use
III. Financial statements
- 3 kinds of financial statements
+ balance sheet: assets & liabilities
+ income/profit & loss statement: revenues &
expenses
+ cash flow statement: money circulation
- financial analysis:
+ measure for liquidity
+ measure for efficiency
+ measure for financial leverage
+ measure for profitability
1. All the money received from business activities during a given period of time is …..
a. assets
b. income
c. transactions
2. All the money that a business spends on goods or serivices during a given period is …..
a. debts
b. expenditure c. liabilities
3. A financial operating plan showing expected income and expenditure is …..
a. account
b. budget
c. financial statement
4. Anything owned by a business – cash, buildings,machines, equipment, etc is called …..
a. asset
b. income
c. revenue

4. 5. All the money that a company will have to pay tosomeone else in the future, is …..
a. debits
b. expenditure c. liabilities
6. An entry in an account, recording a payment made
a. credit
b.debt
c. debit
7. An entry in an account, recording a payment received is …..
a. credit
b. debt
c. income
8. An adjective describing something without amaterial existence, which you can‟t touch …..
a. current
b. intangible
c. tangible
9. An adjective describing a liability which has been incurred but not yet invoiced to the …..
a. accrued
b. deferred
c. receivable
10. Delayed or postponed until a later time …..
a. deferred
b. payable
c. retained
UNIT 28. VENTURE CAPITAL
Discussion questions:
1. If you were starting a new company, how could you try to raise money?
2. A completely new company is often referred toas a „start-up‟. In what ways can start-ups
be risky ventures? Can you think of any star-upswhich have become very successful in the
last few years? What factors do you think contributes to their success?
3. What are the main ways that established companies raise capital?
 the ways to raise capital for a start-up
- new business: start-up → private companies
→ not selling stocks/shares → what are the waysthey raise their capital?
- small companies: capital from the founders/owners
- large companies: capital from the other financial organizations: banks
- banks: risk – averse → dangerous for the new company to lend
- venture capital/risk capital companies: fundsfor new companies.
- some: their capital to fund new ones
- most: capital from other financial organizations
→ angels/high net worth individuals/angel investors

5. - other investors: pension funds or insurancecompanies → new companies → potential for
rapidgrowth & successful in their business.
 rate of return
- new companies: venture capitalists → theirbusiness plan
- what are the standard elements of a businessplan?
- due to the high risk from start-ups → high rateof return
- rate of return: the return in terms of the annualpercentage of return the investors to get
over fromtheir investment.
- in case: investors can‟t get their return → buy new company‟s shares.
- new company: successful → public company→ listed on the stock exchange → investors:
selltheir shares to get profit → exit strategy.
- venture capitalists: new company in the earlystage → new company: further capital →
mezzanine financing
- mezzanine financing: money invested in a company before it is listed on a stock
exchange.It is lower the support from the banks & raise thecapital of the new company
- mezzamine financing: convertible bonds or preference shares
+ convertible bonds: bonds that are later be converted into shares & lower interest rates
+ preference shares: fixed dividends
UNIT 29. STOCKS & SHARES 1
A. stocks, shares, equities
- securities: stocks, shares & bonds
- in Britain → stock: securities & government bonds
- government bonds: gilt-edged stock/gilts (BE),Treasury notes & Treasury bonds (AE)
- stock market/stock exchange: primary & secondary market
- stock/share: preference & ordinary shares
- market index:
+ DJIA (Dow Jones Industrial Average)
+ NASDAQ (National Association of SecuritiesDealer Automated Quotation)
+ FTSE (Financial Times Stock Exchange)
+ AIM (Alternative Investment Market)

6. - market index is used to:
+ measure the market value of stocks
+ provide the price trends of a specific industry or the whole market.
B. going public
- company: a group of people joins together to dobusiness → make profit → share capital
- CoPte: Private limited company
- CoPlc: Public limited company
going public
CoPte
CoPlc
company
listed/quoted
unlisted
companies
companies
- procedures for a company to list & issue stocks
+ public company → advice from investment bank → due diligence from independent
accountant → prospectus & financial results → a flotation/IPO→ investment underwrites the
stocks
C. ordinary & preference shares
Ordinary shares
-
receives variable dividends
-
have the voting rights
at the AGM
Preference shares
-
receive fixed dividends
- are repaid in advance in case of
company‟s bankrupt or liquidation

7. UNIT 30. STOCKS & SHARES 2
•
buying & selling shares - kinds of stock markets
a. based on the capital circulation:
+ primary market: newly isssued shares are sold
- most important function: to mobilize capital for investment.
+ secondary market: issued shares are traded here
b. based on the mode of market
+ security market: all the shares are traded on the trading floor
- listed the shares of the large, famous companies
- shares are traded through auction
- lots of regulations
+ over-the-counter (OTC):
- share trading through computers
- unlisted companies
- fewer regulations
c. based on the goods in the market:
+ share market: shares – preference & ordinary shares are traded
+ bond market: company & government bonds are purchased & sold
+ derivative market: warrants, options are traded
- prices of shares:
* nominal value/par value: the price written on the shares
registered capital
nominal value =
number of shares issued
* market value/price: the price of shares trading at a stock exchange & dependent on the
supply & demand
- some stock exchanges: automatic trading system for both the buyers & sellers
- other markets: market makers: traders in stock for bidding & offering price.
→ spread/difference b/w prices: their profit/mark-up
- most customers: their trading through stockbrokers.

8. • new share issues
- right issues: companies issued the new shares for their existing shareholders.
- others: to capitalize part of their profits or retained earnings by issuing new shares for
existing shareholders.
→ script issue, capitalization issue & bonus issue
- own shares: some companies have much cash, they can buy back their own shares.
• categories of stocks & shares
* blue chips: stocks of large companies reputed in profitability, quality & reliability
* growth stocks: stocks expected a rise in value regularly & not paying dividends, so the
shareholders‟ equity: increase.
* income stocks: stocks having high dividends
* defensive stocks: stocks having regular dividends & rarely increase their prices, stable
earnings
* value stocks: stocks that investors believe shares they trade are lower price than the
company‟s assets.
- dividend = net income - interest for preferenceshares - retained earnings/the number of
ordinaryat present
UNIT 32. SHAREHOLDERS
1. Investors
- stock markets: measured by stock indexes (indices)
ex: - Dow Jones Industrial Average (DJIA): is price-weighted average of 30 significant
stocks traded on the New York Exchange & the NASDAQ
- The NASDAQ: is the computerized system that facilitates trading & provide price
quotations on more than 5,000 of the more actively traded overthe counter stocks.
+ traditionally home to many high-tech stockssuch as Microsoft, Intel, Dell, Cisco.
- FTSE 100 (Footsie): jointly owned by the Financial Times & the London Stock
Exchange, an index of blue-chip stocks on the London Stock Exchange.
These indices: the change in the average prices of selected groups of important stocks.
several stock markets crash when these indices have fallen considerably on a single
day
ex: „Black Monday‟

9. * On Oct. 19th, 1987 when the Dow Jones Industrial Average (DJIA) lost almost 22.6% in
asingle day
* That event marked the beginning of a globalstock market decline, making Black
Monday one ofthe most notorious days in recent financial history
* By the end of the month, most of the majorexchanges had dropped more than 20%
- animal names used to describe the investors
* bulls: investors expecting the prices rise.
* bears: investors expecting the prices fall.
* stags: investors buying new shares that will be over-subscribed (mua chứng khoán quá
nhiều) tohope the demand to be over the available stocks →to sell them for a profit.
* bull market
* bear market
2. Dividends & capital gains
2.1. dividends
* cum dividends: investors receive the next div.the company pays.
* ex dividends: investors do not receive their div.
→ cum div. share price: higher b/c of the estimatedvalue of the coming dividends.
2.2. capital gains
* some shareholders: capital gains → raising theirmoney by selling stocks at the higher
prices than the one they bought.
* some do not receive their dividends → tax oncapital gains is lower than the income tax
for theirdividends.
3. Speculators
- speculators: people buying & selling stocks fora profit
* day traders: persons who purchases & sells stocks during one trading day/before the
settlementday.
+ settlement day: the day on which the buyershave to pay for the sellers the stocks they
have bought.
+ settlement day: usually 3 business days afterthe trade was made.
+ before the settlement day: day traders do notneed to pay the money.
* online brokers: persons who works with the daytraders for low commission
- speculators:

10. * short position (vị thế đầu cơ bán trước): a position showing sales over purchases in
anticipation of a fall in prices.
* long position (vị thế đầu cơ mua trước): a position showing purchases over sales in
anticipation of a rise in prices/the investors keep or own their securities due to a rise in prices.
UNIT 32. SHARE PRICES
1. Factors
- financial situation of the company.
- situation of the industry where the com. works
- state of the economy.
- belief of the investors.
→ price-sensitive information (thông tin giá nhạy cảm) may make the prices change.
2. Predicting prices
* random walk hypothesis (giả thuyết bước đingẫu nhiên): giá chứng khoán phản ánh
nhữngphản ứng đối với tin tức thị trường theo kiểungẫu nhiên, vì thế khó mà tiên đoán được.
Giảthuyết bước đi ngẫu nhiên do nhà toán họcngười Pháp Louis Bachelier đưa ra đầu tiên
năm1900 và hồi sinh vào thập niên 1960.
* fundamental analysis (phân tích cơ bản):
+ a share: true or correct value & differentfrom its stock market value.
+ its true value: reflecting its present valueof the future income from dividends.
+ major factors for that way:
- fundamental information of the company(phân tích thông tin cơ bản của công ty)
- financial statement analysis
- company‟s operation analysis (phân tíchhoạt động của công ty)
→after analysis, analyst must show his predictionfor some important targets: expected
revenue, book value for shares, recommendations for trading shares.
* technical analysis (phân tích kỹ thuật)
+ studying charts of past stock prices allowsyou to predict the future changes.
ex: head & shoulder pattern (biểu đồ đầu & 2 vaimẫu dạng đồ thị này bao gồm: 1 đợt tăng vọt
giásau cùng (đầu) tách biệt 2 đợt tăng giá nhỏ (2 vai)dù 2 vai không nhất thiết bằng nhau. Vai
1 làbước đột phá giá thứ nhì trong bối cảnh giá lên vàvai 2 là bước đột phá thứ nhất trong bối
cảnh giáxuống. Ta có thể vẽ đường cổ vai nối từ đáy của 2 vai, và sự khẳng định xu hướng
giá được nhìn nhận khi có mức giá đóng cửa quyết định nằmdưới đường cổ vai này. Mục tiêu

11. định giá đượcdựa trên khoảng cách thẳng đứng từ đầu đến cổvai sau đó dự đoán giá xuống từ
vị trí mà đườngcổ vai bị xuyên qua.
* efficient market hypothesis:
+ share price change: based on the behaviorof the investors due to the relevant
information.
3. Types of risk
- systematic risk: risk that can‟t be diversified away as it is the risk of market movements or
ofmarket segment movements, it is also known asmarket risk (rủi ro không thể lãng tránh
được dođó là rủi ro của các biến chuyển thị trường hoặccác biến chuyển đoạn khúc thị
trường, hay còn gọi là rủi ro thị trường)
+ eliminated by diversification
- unsystematic risk: risk that affects individual companies & their shares
+ reduce unsystematic risk by having a broadcollection of different investments
(diversifiedporfolio)
UNIT 33. BONDS
Definitions of Bond
- bond: a debt investment in which an investorloans money to an entity (corporate or
government)that borrows the funds for a defined period of timeat a fixed interest rate.
- bonds: used by companies, municipalities, states& the U.S & foreign governments to
finance avariety of projects & activities.
- bonds: commonly referred to as fixed-incomesecurities & are one of the 3 main asset
classes, along with stocks & cash equivalents.
- the indebted entity (issuer) issues a bond that states the interest rate (coupon) that will be
paid &when the loaned funds (bond principal) are to bereturned (maturity date).
- interest in bond: usually paid every 6 months(semi-annually).
- the main categories of bonds: corporate bonds,municipal bonds, & the U.S Treasury
bonds, notes & bills, which are collectively referred to as simply“Treasuries”.
- 2 features of a bond: credit quality & duration are the principal determinants of a bond‟s
interestrate.
- bond maturities range from a 90 day; Treasurybill to a 30 – year government bond.
- corporate & municipals: typically in the 3 to 10-year range.
1. Government & corporate bonds
- bonds: loans to local & national governments, &to large companies.

12. - bondholders: fixed interest payments, once or twice/year.
- principal: money invested by bondholders.
- maturity date: the date when the loan ends.
- in Britain, government bonds: gilt –edged stockor gilts (công trái).
- in the U.S, government bonds:
* Treasury notes: 2 to 10 - year maturity (kỳphiếu kho bạc)
* Treasury bonds: 10 to 30 - year maturity (tráiphiếu kho bạc)
- corporate bonds (trái phiếu công ty): less interestto bondholders but safer than shares.
- credit ratings (đánh giá tín dụng/khả năng trả nợ)the company‟s ability to repay the loan to
the bondholders.
- credit agencies: Standard & Poor‟s & Moody‟s→ grade, rate the ability of the company to
repay the loans to the bondholders.
- to default (không trả lãi/không trả lại vốn vay):fail to pay interest or repay the principal.
- use the letter to grade, rate the credit ratings ofa company like AAA, Aaa, Baa, BBB, C,
etc …
- insolvent (không có khả năng trả lãi/trả lại vốn vay): unable to pay the interest or repay
the capital.
2. Prices & yields
- bonds: traded by banks → as market makers tobid & offer prices with a small spread.
- prices of bonds: inversely with interest rates.
- yield of a bond (lãi suất trái phiếu): income frombonds.
- coupon (tiền lãi trái phiếu): the amount of interest a bond pays.
- floating – rate notes (trái phiếu có lãi suất thả nổi)bonds whose interest rate varies with
market interestrates.
3. Other types of bonds
- convertible shares (convertibles): bonds that latercan be changed into shares.
- zero coupon bonds (trái phiếu không trả lãi/tráiphiếu chiết khấu): bonds that pay no
interest but aresold at a big discount on their par value.
- capital gain at maturity (khoản lãi vốn lúc đáo hạn)
- junk bonds (trái phiếu nhảy vọt/trái phiếu rủi rocao): low credit rating but high interest
bonds.
- fallen angels (trái phiếu mất giá/trái phiếu thấtthời): bonds of companies that were
previously in agood financial situation.

13. Notes:
* government bonds: classified according to thelength of time before maturity → 3 main
categories
+ bills: debt securities maturing in less than 1 year
+ notes: debt securities maturing in 1 to 10 years
+ bonds: debt securities maturing in more than10 years
* municipal bonds:
+ major advantage: the return is free from federaltax.
+ depending on your personal situation, a municipal bond can be a great investment on an
after tax basis
* corporate bonds
+ short - term corporate bonds: less than 5 years
+ intermediate bonds: 5 to 12 years
+ long - term bonds: over 12 years
+ corporate bonds are characterized by higher yields because there is a higher risk of a
companydefaulting than a government
UNIT 34. FUTURES
1. Commodity futures
* Forward & future contracts: agreements to sellan asset at a fixed price on a fixed date in
the future
* Futures: traded on a wide range of agriculturalproducts, industrial metals, precious metals
& oil
* Futures: invented to enable regular buyers & sellers of commodities to protect themselves
againstlosses or to hedge against future change in price
* Futures: standardized contracts, which are forfixed quantities & fixed time period that are
tradedon a special exchange
* Forwards: individual, non –standardized contracts between 2 parties, traded OTC, directly
between 2 companies or financial institutions, rather than through an exchange.
* spot price (giá giao ngay): the price that would be paid for immediate delivery
* backwardation (chênh lệch giá xuống): the shortterm demand that pushes the spot price
above thefuture price

14. * futures & forwards: used by speculators
2. Financial futures (giao dịch tài chính kỳ hạn)
* currency futures & forwards (giao dịch tiền tệ kỳhạn và giao sau): contracts that specify
the price atwhich a certain currency will be bought or sold on aspecified date
* interest rate futures (giao dịch lãi suất kỳ hạn):agreements b/w banks & investors &
companies toissue fixed income securities at a future date
* stock futures (giao dịch chứng khoán kỳ hạn): fix the price for a stock (chốt giá cho một
chứng khoán)
* stock index futures (giao dịch chỉ số chứng khoán)fix a value for an index on a certain date
(chốt mộtgiá trị cho một chỉ số)
* future trading: a zero – sum game because the amount of money gained by one party will be
thesame as the sum lost by the other (giao dịch kỳ hạnlà trò chơi được mất ngang nhau vì
lượng tiền mà 1bên kiếm được sẽ bằng lượng tiền mà bên kia mất đi
* definition of zero – sum game
+ a situation in which one participant‟s gains result only from another participant‟s
equivalentlosses
* the net change in total wealth among participantis zero; the wealth is just shifted from one
to another
* options & future contracts: examples of zero - sum game (excluding cost). For every
person whogains on a contract, there is a counter – party wholost. Gambling: also an example
of a zero – sumgame
* a stock market; however, is not a zero –sum game because wealth can be created in a
stock exchange
UNIT 35. DERIVATIVES
1. Options
* derivatives: financial products whose value isderived on/depends on another financial
product,such as a stock, a stock market index or interest ratepayments. (sản phẩm phái sinh
là những sản phẩmtài chính mà giá trị của chúng phái sinh từ hay phụthuộc vào sản phẩm
tài chính khác như một cổphiếu, một chỉ số thị trường chứng khoán, hoặc
những khoản chi trả lãi suất)
* purpose of derivatives:
+ to manage the risks with the securities
+ to protect securities against fluctuations in value
+ to speculate the securities

15. * main kinds of derivatives
+ options: like futures except that they give theright (not the obligation) to buy or sell an
asset inthe future (quyền chọn cũng giống như những giaodịch kỳ hạn chỉ khác là chúng trao
quyền (nhưngkhông ràng buộc) để mua hoặc bán một tài sản trong tương lai)
+ call option: the right to buy an asset for a specific price, either at any time before the
option endsor on a specific future date (quyền chọn mua: quyềnmua một tài sản với một giá
cụ thể ở bất cứ thờiđiểm nào trước khi quyền chọn kết thúc hoặc vàomột thời điểm cụ thể
trong tương lai)
+ put option: the right to sell an asset at a specific price within a specific period or on a
specificfuture date (quyền chọn bán: quyền bán tài sản ởmột giá cụ thể trong một thời hạn
được quy địnhhoặc vào một thời điểm cụ thể trong tương lai)
2. In – the – money & out – the - money
* in – the – money (trong giá):
+ for a call option: when the option‟s strike priceis below the market price of the
underlying asset(đối với quyền chọn mua: đó là khi giá thực hiện của quyền chọn ở dưới giá
thị trường của tài sản cơbản)
+ for a put option: when the strike price is abovethe market price of the underlying asset
(đối vớiquyền chọn bán: đó là khi giá thực hiện của quyềnbán ở trên giá thị trường của tài sản
cơ bản)
* out – the – money (ngoài giá):
+ for a call option: when an option‟s strike price is higher than the market price of the
underlying asset (đối với quyền chọn mua: đó là khi giá thực hiện của quyền chọn cao hơn
giá thị trường của tàisản cơ bản)
+ for a put option: when the strike price is belowthe market price of the underlying asset
(đối vớiquyền chọn bán: đó là khi giá thực hiện của quyềnchọn thấp hơn giá thị trường của tài
sản cơ bản)
* premium (hồi kim)
+ the total cost of an option (tổng phí của mộtquyền chọn)
+ the difference between the higher price paid fora fixed – income security & the security‟s
faceamount of issue (chênh lệch giữa giá cao hơn chi trảcho một chứng khoán có lợi tức cố
định và số lượngdanh nghĩa lúc phát hành của chứng khoán đó)
* strike price (giá thực hiện) = exercise price
+ the price at which a specific derivative contractcan be exercised (giá mà ở đó một hợp
đồng pháicụ thể có thể được thực hiện)
* strike prices are mostly used to describe stock &index option, in which strike prices are
fixed in thecontract (giá thực hiện phần lớn được dùng để mô tảquyền chọn chỉ số và cổ
phiếu, trong đó giá thực hiện được ấn định trong hợp đồng)

16. 3. Warrants & swaps
* warrants (chứng khế): like options, give the rightbut not the obligation , to buy stocks in
the futureat a particular price, probably higher than the current market price (chứng khế,
giống như quyềnchọn, trao quyền, nhưng không ràng buộc, để muacổ phiếu trong tương lai ở
một giá cụ thể, có thể caohơn giá thị trường hiện tại)
+ option: maturity of 3, 6 or 9 months, while thewarrants: long maturity of up to 10 years
* swaps (hoán đổi): arrangements between institutions to exchange interest rates or
currencies
e.g. dollars for yen) (hoán đổi là những sắp xếp giữacác tổ chức để trau đổi lãi suất hay tiền
tệ)
UNIT 36. ASSET MANAGEMENT
1. Allocating & diversifying assets
* asset management: managing financial assets for institutions or individuals.
* the management of a client‟s investments: by afinancial service company, usually an
investmentbank.
* the company will invest on behalf of its clients& give them access to a wide range of
traditional &alternative product offerings that would not be to theaverage investor
* asset managers: decide how to allocate fundsthey‟re responsible for: how much to invest
in sharemutual funds, bonds, cash, foreign currencies, precious metals, or other types of
investments.
* asset allocation decision: depending on objectives & size of the portfolio
* portfolio: a grouping of financial assets such asstocks, bonds & cash equivalents
* portfolios are held directly by investors and/ormanaged by financial professionals.
* unit trusts (BE) (công ty đầu tư ủy thác): an unincorporated mutual fund structure that
allowsfunds to hold assets & pass profits through to theindividual owners, rather than
reinvesting them back into the fund (một cấu trúc quỹ hỗ tương không có tư cách pháp nhân
cho phép quỹ nắm giữtài sản và chuyển lợi nhuận cho chủ sở hữu cá nhân,chứ không phải tái
đầu tư trở lại quỹ)
* mutual funds (AE): the investment fund is set up under a trust deed. The investor is
effectivelythe beneficiary under the trust (quỹ đầu tư đượcthành lập theo một chứng thư ủy
thác. Nhà đầu tưthực ra là người hưởng lợi theo sự ủy thác này)
2. Types of investors
- investors: different goals/objectives for their investments
* regulate income from the investment & do notpay attention to the size of their capital

17. * preserve their capital to avoid risks → capitalpreservation: asset manager would allocate
moremoney in bonds not in stocks.
* accumulate their capital → lots of risks → capital accumulation: the portfolio will
include morestocks than bonds because stocks: better profit potentials than bonds but their
prices: more volatile
3. Active & passive investment
* active investment: buying & selling more often,adapting the portfolio to changing the
market context.
* passive investment: purchasing & keeping securities, making portfolio unchanged for a
long time.
* index – linked funds: to track/follow the changeof the stock market index → these funds:
purchaselots of different stocks in this index → index mayfluctuate so will the funds.
* investors in these funds: charge the lower feesthan the actively managed accounts.
* investors: not outperform the market, that meansthey can‟t make their return more than the
averageone in the market.
UNIT 37. HEDGE FUNDS & STRUCTURED PRODUCTS
1. Hedge funds (quỹ đầu tư hợp tác)
* hedge fund: an aggressively managed portfolioof investments that uses advanced
investment strategies such as leveraged, long, short & derivativepositions in both domestic &
international marketswith the goal of generating high returns (một danh mục đầu tư được
quản lý một cách năng nổ chonhững khoản đầu tư sử dụng đến các chiến lược tiêntiến như
đầu cơ vay nợ(đòn bẩy tài chính), trường vịđoản vị, phái sinh ở cả thị trường trong nước lẫn
quốc tế với mục tiêu tạo ra lợi nhuận cao)
* legally, hedge funds are most often set up asprivate investment partnerships that are open
to alimited number of investors & require a very largeinitial minimum investment (về mặt
pháp lý, quỹđầu tư hợp tác thường được thiết lập với tư cách quan hệ đối tác đầu tư tư nhân
dành cho một số ít các nhà đầu tư và đòi hỏi một mức đầu tư tối thiểuban đầu rất lớn).
* investments in hedge funds are illiquid as theyoften require investors keep their money in
the fund for at least 1 year (việc đầu tư vào các quỹ đầu tư hợp tác có tính thanh khoản kém
vì các khoản đầutư này thường buộc nhà đầu tư phải giữ tiền trongquỹ ít nhất 1 năm).
2. Leverage or gearing, arbitrage
* gearing or leverage: borrowing money as wellas using their own funds to increase the
amount ofcapital available for investment → the fund: holdmuch larger positions or
investments.
* hedge funds: investing where they see opportunities to make short – term profits,
generally usinga wide range of derivative contracts - options, swaps

18. * gearing/leverage: a fundamental analysis ratioof a company‟s level of long – term debt
comparedto its equity capital. Gearing is expressed in percentage form (tỷ lệ phân tích cơ bản
về mức độ nợ dàihạn của một công ty so với vốn chủ sở hữu của nó.Đòn bẩy tài chính được
thể hiện dưới dạng tỷ lệbách phân).
* company with high gearing – more long – termliabilities than shareholder equity – are
consideredspeculative (công ty với vốn vay cao – nhiều nợ dàihạn hơn so với vốn cổ đông –
được xem là mang tính đầu cơ) → taking long or short position.
* in simpler terms, gearing explains how a company finances its operation – either through
outsidelenders or through shareholders ( đơn giản hơn, đòn bẩy tài chính/vốn vay giải thích
cách thức một côngty cấp vốn cho hoạt động của mình hoặc thông qua các công ty cho vay
bên ngoài hoặc thông qua cáccổ đông).
3. Arbitrage
* the simultaneous purchase & sale of an asset inorder to profit from a difference in the
price (việcmua bán đồng thời một tài sản để kiếm lợi từ sựchênh lệch giá).
* it is a trade that profits by exploiting price differences of identical or similar financial
instruments,on different markets or in different forms (là mộtngành kinh doanh kiếm lợi
nhuận bằng cách khai thác chênh lệch giá của các công cụ tài chình giốngnhau hoặc tương tự
ở các thị trường khác nhau hoặcở các hình thức khác nhau).
* arbitrage exists as a result of market inefficiencies; it provides a mechanism to ensure
prices donot deviate substantially from fair value for long periods of time (kinh doanh chênh
lệch giá tồn tại làhệ quả của sự thiếu hiệu quả của thị trường, kinh doanh chênh lệch giá cung
cấp một cơ chế để đảm bảo giá cả không chênh lệch nhiều so với giá trị hợplý trong những
khoảng thời gian dài).
4. Structured products
* customized financial instruments by using derivative products – futures, forwards,
options, warrants, etc – similar to hedge funds & dependingon customers‟ requirements &
changes in the markets.
Notes:
* capital protection: this may be in the form of hedging, utilizing forwards, futures or swaps
contracts or it could be in the form of insurance usingoptions (bảo vệ vốn: đây có thể theo
hình thức tránh rủi ro, sử dụng các hợp đồng giao sau, kỳ hạn hoặc có thể là hình thức bảo
hiểm sử dụng quyền chọn).
* yield enhancement (nâng cao lợi suất): điều nàythường đạt được bằng cách bán quyền
chọn đối vớimột tài sản cơ bản. Hồi kim từ quyền chọn được kýphát (bán) cung cấp lợi suất
rhu nhập bổ sung).
* full participation (tham gia đầy đủ): đây là nhữngsản phầm có đặc tính rủi ro tương tự như
tài sản cơbản, nhưng cho phép khách hàng sự tiện lợi của việccó thể kinh doanh các loại tài
sản bất thường nhưcác chỉ số chứng khoán nước ngoài hay một chỉ sốkhu vực thị trường cụ
thể.

19. UNIT 39. MERGERS & TAKEOVERS
1. Mergers, takeovers & joint venture
1.1. M & A
* a general term used to refer to the consolidation(sự hợp nhất) of companies.
* a merger: a combination of at least 2 companiesto form a new company.
* an acquisition/a takeover: the purchase of one company by another in which no new
company isformed.
* the term M & A refers to the department at financial institutions that deals with mergers
&acquisitions.
1.2. joint venture
* a joint venture (JV) exists when 2 or more companies decide to work together for a
specific projector product.
* a JV: the cooperation of 2 or more individualsor businesses in which each agrees to
share profit, loss & control in a specific enterprise.
* forming a JV is a good way for companies to partner without having to merge.
* JVs: typically taxed as a partnership.
1.3. takeover/acquisition
* happening in 2 ways:
+ takeover bid: a company can offer to buy allthe shareholders‟ shares at a certain higher
price than the market price during a limited period of time.
+ raid: a company can buy as many as sharesas possible on the stock exchange to hope
to gain amajority part in that company.
2. Hostile of friendly
2.1. friendly takeover
* a situation in which a target company‟s management & board of directors agree to a
merger oracquisition by another company.
* in a friendly takeover, a public offer of stock or cash is made by the acquiring firm, &
the board of target firm will publicly approve the buyout formwhich may yet be subject to
shareholder or regulatory approval.
2.2. hostile takeover
* in contrast to friendly takeover, where companybeing acquired does not approve the
buyouts & fights against the acquisition.

20. * the acquisition of one company (called the target company) by another (called the
acquirer) thatis accomplished not by coming to an agreement with the target company‟s
management, but by going directly to the company‟s shareholders orfighting to replace
management in order to get the acquisition approved.
* various ways of depending companies againsta hostile takeovers:
+ a white knight: an individual, or another company rescues a company to avoid the
hostiletakeover bid
+ the poison pill: a defensible way of some companies to reduce the takeover bid by
selling all the important assets that make the takeover bidmore expensive.
3. Integration
3.1. horizontal integration:
* the acquisition of additional business activitiesthat are at the same level of the value
chain in similar or different industries. This can be achieved byinternal or external expansion.
* because the different firms are involved in thesame stage of production, horizontal
integrationallows them to share resources at that level.
* if the products offered by the companies arethe same or similar, it is a merger of
competitors.
3.2. vertical integration
* when a company expands its business into areasthat are at different points on the same
productionpath, such as when a manufacturer owns its supplierand/or distributor.
* vertical integration can help companies reducecosts & improve efficiency by decreasing
transportexpenses & reducing turnaround (hoàn toàn) time,among other advantages.
* 2 possibilities of vertical integration
+ backward integration
- a form of vertical integration that involvesthe purchase of suppliers. Companies will
pursue(đuổi theo) backward integration when it will resultin improved efficiency & cost
savings.
- for example, backward integration might cuttransportation costs, improve profit
margins & make the firm more competitive.
+ forward integration
- a type of vertical integration that involvesthe purchase of control of distributors.
- a business strategy that involves a form of vertical integration whereby activities are
expandedto include control of the direct distribution of itsproducts.
- a good example of forward integration is when a farmer sells his/her crops at the local
market rather than to a distribution center.