This document provides an introduction to investment terminology and concepts. It defines key terms like finance, investment, and different types of financial assets. It also summarizes the major participants in the financial system including households, financial intermediaries like banks and mutual funds, and the markets they interact in such as primary and secondary markets. Different types of financial securities are also outlined including debt instruments and equity instruments.
Many investors mistakenly base the success of their portfolios on returns alone. Few consider the risk that they took to achieve those returns. Since the 1960s, investors have known how to quantify and measure risk with the variability of returns, but no single measure actually looked at both risk and return together. Today, we have three sets of performance measurement tools to assist us with our portfolio evaluations. The Treynor, Sharpe and Jensen ratios combine risk and return performance into a single value, but each is slightly different. Which one is best for you? Why should you care? Let's find out.
Portfolio performance measures should be a key aspect of the investment decision process. These tools provide the necessary information for investors to assess how effectively their money has been invested (or may be invested). Remember, portfolio returns are only part of the story. Without evaluating risk-adjusted returns, an investor cannot possibly see the whole investment picture, which may inadvertently lead to clouded investment decisions.
noorulhadi Lecturer at Govt College of Management Sciences, noorulhadi99@yahoo.com
i have prepared these slides and still using in mylectures, Reference: Portfolio management by S kevin and online sources
Financial system and markets:
objectives of financial system-
Concepts of financial system-
Financial concepts-
Development of financial systems in India-
Weakness of Indian financial system
this ppt is about the financial services .whats the financial services, types of financial services,functions of financial services,importance of financial services,features of financial services,Indian financial system as well as international financial management.
A comprehensive presentation on the financial risks involved in businesses in general & specifically in banks.
What is Risk?
Generally - Danger, Hazard, Adverse impact, Fear of loss.
Financially-Loss of earnings/capital
May result in incapability of financial institution to meet business goals
Basically there are 4 main risks:
1. Credit Risk
2. Market Risk
3. Liquidity Risk
4. Operational Risk
Many investors mistakenly base the success of their portfolios on returns alone. Few consider the risk that they took to achieve those returns. Since the 1960s, investors have known how to quantify and measure risk with the variability of returns, but no single measure actually looked at both risk and return together. Today, we have three sets of performance measurement tools to assist us with our portfolio evaluations. The Treynor, Sharpe and Jensen ratios combine risk and return performance into a single value, but each is slightly different. Which one is best for you? Why should you care? Let's find out.
Portfolio performance measures should be a key aspect of the investment decision process. These tools provide the necessary information for investors to assess how effectively their money has been invested (or may be invested). Remember, portfolio returns are only part of the story. Without evaluating risk-adjusted returns, an investor cannot possibly see the whole investment picture, which may inadvertently lead to clouded investment decisions.
noorulhadi Lecturer at Govt College of Management Sciences, noorulhadi99@yahoo.com
i have prepared these slides and still using in mylectures, Reference: Portfolio management by S kevin and online sources
Financial system and markets:
objectives of financial system-
Concepts of financial system-
Financial concepts-
Development of financial systems in India-
Weakness of Indian financial system
this ppt is about the financial services .whats the financial services, types of financial services,functions of financial services,importance of financial services,features of financial services,Indian financial system as well as international financial management.
A comprehensive presentation on the financial risks involved in businesses in general & specifically in banks.
What is Risk?
Generally - Danger, Hazard, Adverse impact, Fear of loss.
Financially-Loss of earnings/capital
May result in incapability of financial institution to meet business goals
Basically there are 4 main risks:
1. Credit Risk
2. Market Risk
3. Liquidity Risk
4. Operational Risk
1 Role of Financial Markets and InstitutionsCHAPTER OBJECTIVES.docxlorainedeserre
1 Role of Financial Markets and Institutions
CHAPTER OBJECTIVES
The specific objectives of this chapter are to:
· ▪ describe the types of financial markets that facilitate the flow of funds,
· ▪ describe the types of securities traded within financial markets,
· ▪ describe the role of financial institutions within financial markets, and
· ▪ explain how financial institutions were exposed to the credit crisis.
A financial market is a market in which financial assets (securities) such as stocks and bonds can be purchased or sold. Funds are transferred in financial markets when one party purchases financial assets previously held by another party. Financial markets facilitate the flow of funds and thereby allow financing and investing by households, firms, and government agencies. This chapter provides some background on financial markets and on the financial institutions that participate in them.
1-1 ROLE OF FINANCIAL MARKETS
Financial markets transfer funds from those who have excess funds to those who need funds. They enable college students to obtain student loans, families to obtain mortgages, businesses to finance their growth, and governments to finance many of their expenditures. Many households and businesses with excess funds are willing to supply funds to financial markets because they earn a return on their investment. If funds were not supplied, the financial markets would not be able to transfer funds to those who need them.
Those participants who receive more money than they spend are referred to as surplus units (or investors). They provide their net savings to the financial markets. Those participants who spend more money than they receive are referred to as deficit units. They access funds from financial markets so that they can spend more money than they receive. Many individuals provide funds to financial markets in some periods and access funds in other periods.
EXAMPLE
College students are typically deficit units, as they often borrow from financial markets to support their education. After they obtain their degree, they earn more income than they spend and thus become surplus units by investing their excess funds. A few years later, they may become deficit units again by purchasing a home. At this stage, they may provide funds to and access funds from financial markets simultaneously. That is, they may periodically deposit savings in a financial institution while also borrowing a large amount of money from a financial institution to buy a home.
Many deficit units such as firms and government agencies access funds from financial markets by issuing securities, which represent a claim on the issuer. Debt securities represent debt (also called credit, or borrowed funds) incurred by the issuer. Deficit units that issue the debt securities are borrowers. The surplus units that purchase debt securities are creditors, and they receive interest on a periodic basis (such as every six months). Debt securities have a maturity da ...
2024.06.01 Introducing a competency framework for languag learning materials ...Sandy Millin
http://sandymillin.wordpress.com/iateflwebinar2024
Published classroom materials form the basis of syllabuses, drive teacher professional development, and have a potentially huge influence on learners, teachers and education systems. All teachers also create their own materials, whether a few sentences on a blackboard, a highly-structured fully-realised online course, or anything in between. Despite this, the knowledge and skills needed to create effective language learning materials are rarely part of teacher training, and are mostly learnt by trial and error.
Knowledge and skills frameworks, generally called competency frameworks, for ELT teachers, trainers and managers have existed for a few years now. However, until I created one for my MA dissertation, there wasn’t one drawing together what we need to know and do to be able to effectively produce language learning materials.
This webinar will introduce you to my framework, highlighting the key competencies I identified from my research. It will also show how anybody involved in language teaching (any language, not just English!), teacher training, managing schools or developing language learning materials can benefit from using the framework.
The Art Pastor's Guide to Sabbath | Steve ThomasonSteve Thomason
What is the purpose of the Sabbath Law in the Torah. It is interesting to compare how the context of the law shifts from Exodus to Deuteronomy. Who gets to rest, and why?
We all have good and bad thoughts from time to time and situation to situation. We are bombarded daily with spiraling thoughts(both negative and positive) creating all-consuming feel , making us difficult to manage with associated suffering. Good thoughts are like our Mob Signal (Positive thought) amidst noise(negative thought) in the atmosphere. Negative thoughts like noise outweigh positive thoughts. These thoughts often create unwanted confusion, trouble, stress and frustration in our mind as well as chaos in our physical world. Negative thoughts are also known as “distorted thinking”.
Read| The latest issue of The Challenger is here! We are thrilled to announce that our school paper has qualified for the NATIONAL SCHOOLS PRESS CONFERENCE (NSPC) 2024. Thank you for your unwavering support and trust. Dive into the stories that made us stand out!
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
The empire's roots lie in the city of Rome, founded, according to legend, by Romulus in 753 BCE. Over centuries, Rome evolved from a small settlement to a formidable republic, characterized by a complex political system with elected officials and checks on power. However, internal strife, class conflicts, and military ambitions paved the way for the end of the Republic. Julius Caesar’s dictatorship and subsequent assassination in 44 BCE created a power vacuum, leading to a civil war. Octavian, later Augustus, emerged victorious, heralding the Roman Empire’s birth.
Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
The Roman Empire’s society was hierarchical, with a rigid class system. At the top were the patricians, wealthy elites who held significant political power. Below them were the plebeians, free citizens with limited political influence, and the vast numbers of slaves who formed the backbone of the economy. The family unit was central, governed by the paterfamilias, the male head who held absolute authority.
Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
How to Create Map Views in the Odoo 17 ERPCeline George
The map views are useful for providing a geographical representation of data. They allow users to visualize and analyze the data in a more intuitive manner.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
This is a presentation by Dada Robert in a Your Skill Boost masterclass organised by the Excellence Foundation for South Sudan (EFSS) on Saturday, the 25th and Sunday, the 26th of May 2024.
He discussed the concept of quality improvement, emphasizing its applicability to various aspects of life, including personal, project, and program improvements. He defined quality as doing the right thing at the right time in the right way to achieve the best possible results and discussed the concept of the "gap" between what we know and what we do, and how this gap represents the areas we need to improve. He explained the scientific approach to quality improvement, which involves systematic performance analysis, testing and learning, and implementing change ideas. He also highlighted the importance of client focus and a team approach to quality improvement.
2. Terminology
Finance – commercial or government activity of
managing money, debt, credit and investment
Investment – the current commitment of
resources in order to achieve later benefits
• present commitment of money for the purpose of
receiving more money later – invest amount of
money then your capital will increase
• Investor is a person or an organization that buys
shares or pays money into a bank in order to receive
a profit
2
3. Definition
(Figure 1.1)
3
INVESTMENT SPECULATION GAMBLING
Objective Specific
goal/objectives
Objectives, only
to gain high
return
Based on LUCK
Risk Low risk Moderate to
high risk
High risk
Period Long term Short term Short term
Analysis Fundamental
analysis
Technical
analysis or
based on
herding
behavior
No analysis
Return Current income
(dividend,
interest)
Capital Gain Capital Gain
4. Real Versus Financial Assets
Real assets are tangible things owned by persons and
businesses
• Residential structures and property
• Major appliances and automobiles
• Office towers, factories, mines
• Machinery and equipment
Financial assets are what one individual has lent to
another
• Consumer credit
• Loans
• Mortgages
4
5. The Financial System (Overview)
The household is the primary provider of funds to
businesses and government.
• Households must accumulate financial resources throughout
their working life times to have enough savings (pension) to live
on in their retirement years
Financial intermediaries transform the nature of the
securities they issue and invest in
• Banks, trust companies, credit unions, insurance firms, mutual
funds
Market intermediaries simply help make markets work
• Investment dealers
• Brokers
5
8. The Financial System (Financial
Intermediaries)
Banks and other deposit-taking institutions
Insurance companies
Pension Funds
Mutual Funds
8
9. Financial Intermediaries (Insurance
Companies)
Insurers sell policies and collect premiums from customers
based on the pricing of those policies given the probability of
a claim and the size the policy and administrative fees.
They invest the premiums so that the accumulated value in
the future will grow to meet the anticipated claims of the
policyholders.
In this way, unsupportable risks (such as the death of wage
earner or the burning down of a business) are shared among
a large number of policyholders through the insurance
company.
Insurance allows households, business and government to
engage in risky activities without having to bear the entire risk
9
10. Financial Intermediaries (Pension Plan
Assets)
Individuals and employers make payments over the entire
working life of a person with those funds invested to grow over
time.
Ultimately, the accumulated value in the pension can be
used by the person in retirement.
Pension plans accumulate considerable sums of money, and
their managers invest those funds with long-term investment
time horizons in diversified portfolios of investments. These
investments are a major source of capital, fuelling investment
in research and development, capital equipment, resource
exploration and ultimately contributing in a substantial way to
growth in the economy.
10
11. Financial Intermediaries (Mutual Fund
Assets)
Mutual funds give small investors access to diversified,
professionally-managed portfolios of securities.
Small investors often do not have the funds necessary to
invest directly into market-traded stocks and bonds.
This is called denomination intermediation because the
mutual fund makes investments available in smaller,
more affordable amounts of money.
Canadian indirect investment in the markets through
managed products such as mutual funds and
segregated funds has grown exponentially.
11
12. Investment/Financial Instruments
There are two major categories of financial securities:
1. Debt Instruments
• Commercial paper
• Bankers’ acceptances
• Treasury bills
• Mortgage loans
• Bonds
• Debentures
2. Equity Instruments
• Common stock
12
19. Investment/Financial Instruments
(Non-marketable)
Characteristics of non-marketable
securities
• Cannot be traded between or among investors
• May be redeemable (a reverse transaction between
the borrower and the lender)
• Examples:
o Savings accounts
o Term Deposits
o Guaranteed Investment Certificates
o Canada Savings Bonds
19
20. Investment/Financial Instruments
(Marketable)
Characteristics of Marketable securities
• Can be traded between or among investors after
their original issue in public markets and before they
mature or expire.
o Equity or debt instrument (share/stock, bond, note) that
is listed on an exchange and can be readily bought or
sold. A marketable security is a near-cash (liquid) asset
and is recorded at acquisition cost (purchase price plus
incidentals, commissions, and taxes) or market value
(whichever is lower) in the account books under current
assets. Non-marketable securities include savings bonds
and restricted shares/stock.
20
21. Investment/Financial Instruments
(Marketable)
Markets can be categorized by the time to maturity:
• Money Market Securities (for short-term debt securities that are
pure discount notes)
o Bankers’ acceptances
o Commercial Paper
o Treasury Bills
• Capital Market Securities (for long-term debt or equity securities
with maturities greater than 1 year)
o Bonds
o Debentures
o Common Stock
o Preferred Stock.
21
22. Financial Markets
Primary Market
• Markets that involve the issue of new securities by the
borrower in return for cash from investors (Capital
formation occurs)
Secondary Market
• Markets that involve buyers and sellers of existing
securities. Funds flow from buyer to seller. Seller
becomes the new owner of the security. (No capital
formation occurs)
22
23. Financial Markets (Types of Secondary
Markets)
Exchanges or Auction Markets
• Secondary markets that involve a bidding process
that takes place in specific location
• For example TSX, NYSE, Malaysian Stock Exchange
Dealer or Over-the-counter (OTC) Markets
• Secondary markets that do not have a physical
location and consist of a network of dealers who
trade directly with one another.
• For example the bond market
23
24. Financial Markets (Other Markets)
Third Market
• Trading of securities that are listed on organized
exchanges in the Over-the-counter market
Fourth Market
Trading of securities directly between investors
(usually between two large institutions) without the
involvement of brokers or dealers.
Operates through the use of privately owned
automated systems such as Instinet
24
25. The Global Financial Community
Represents an important source of funds for
borrowers
Provides investors with important alternatives as
they seek to build wealth through diversified
portfolios
25
26. Summary
In this chapter you have learned about:
• Financial systems in general.
• Major participants in the financial system,
including the different types of financial securities
and financial markets
26