TAILIEUCHUNG - Lecture Finance - Topic 5: Measuring risk and return

In this chapter we will focus our discussion on risk and return for common stock for an individual investor. The results, however, can be extended to other assets and classes of investors. In fact, in later chapters we will take a close look at the firm as an investor in assets when we take up the topic of capital budgeting. | Risk and Return 8/5/2015 Professor James Kuhle 1 Topic 5 I. Measuring Risk and Return 8/5/2015 Professor James Kuhle 2 A. Return 1. Return can be seen as the reward for investing. 2. Components of Return 3. Importance of Return 4. Calculating Return a. Historical Performance b. Expected Return 8/5/2015 Professor James Kuhle 3 A. Return (continued) Given the following information, calculate the expected return: Return Probability -30% .03 -20% .06 -10% .08 0% .15 Return Probability 10% .18 20% .20 30% .13 40% .12 50% .05 8/5/2015 Professor James Kuhle 4 A. Return (continued) EV = S RiPi n i=1 EV = (-30)(.03) + (-20)(.06) + (-10)(.08) + (0)(.15) + (10)(.18) + (20)(.20) + (30)(.13) + (40)(.12) + (50)(.05) EV = 8/5/2015 Professor James Kuhle 5 A. Return (continued) 5. Measuring Return a. Net Present Value Example: Suppose we are considering investing in an asset that yields $1000 in year one, $1100 in year two, $1500 in year three and $3200 in year four. If your required rate of .

• Tài chính doanh nghiệp
• Lecture Finance
• Financial management
• Financial statement analysis
• Measure risk
• Attitudes toward risk
• Capital asset pricing model
• Business finance
• Lecture Business finance
• Capital market
• Sources of finance
• Leasing finance
• Sources of long term finance
• Long term finance
• Equipment finance
• Ordinary shares
• Long term debt
• Managerial finance
• Principles of managerial finance
• Lecture Principles of managerial finance
• Environment of managerial finance
• Financial services
• Career opportunities
• Financial statements
• Financial analysis
• Cash flow
• Financial planning
• Time value of money
• Future calue
• Risk and Return Fundamentals
• Interest rates
• Bond valuation
• Stock valuation
• Equity capital
• International managerial finance
• Lecture Managerial finance
• Financial options
• Corporate finance
• Option terminology
• Public finance
• Lecture Public finance
• Public Economics
• Federal system
• Fiscal federalism
• Lecture Fundamentals of corporate finance
• Fundamentals of corporate finance
• Financial manager
• Financial markets
• Business organization
• Working with financial statements
• Statement of cash flows
• Public expenditure
• Tiebout model
• Dividend Policy
• Capital structure
• Capital structure decisions
• Capital market efficiency