TAILIEUCHUNG - Lecture Business finance - Chapter 4: Applying the time value of money to security valuation

Chapter 4 - Applying the time value of money to security valuation. Use the tools of financial mathematics to value debt and equity securities, apply the dividend growth model to value ordinary shares, explain the main differences between the valuation of ordinary shares based on dividends and earnings,. | Chapter 4 Applying the Time Value of Money to Security Valuation 2 2 2 2 2 2 2 2 2 Learning Objectives Use the tools of financial mathematics to value debt and equity securities. Apply the dividend growth model to value ordinary shares. Explain the main differences between the valuation of ordinary shares based on dividends and earnings. 2 2 2 2 2 2 2 2 2 Learning Objectives (cont.) Explain the nature of interest rate risk. Understand the theories that are used to explain the term structure of interest rates. Apply the concept of duration to immunise a bond investment. 3 3 3 3 3 3 3 3 2 Valuing a Financial Asset Financial assets are valued under certainty by discounting the known future cash flows at the market interest rate and adding the resultant present values. In the case of shares, the future cash flows are dividends while, in the case of bonds, the future cash flows will be coupon / interest payments. 4 4 4 4 4 4 4 4 3 Note coupon should be singular Valuation of Shares

• Tài chính doanh nghiệp
• Business finance
• Lecture Business finance
• Capital market
• Financial management
• The time value of money
• Equity securities
• Sources of finance
• Leasing finance
• Sources of long term finance
• Long term finance
• Equipment finance
• Ordinary shares
• Long term debt
• Dividend Policy
• Capital structure
• Capital structure decisions
• Capital market efficiency
• Futures contracts
• Option markets
• Analysis of takeovers
• International financial management
• Management of short term assets
• Financial decisions
• Financial mathematics
• Project evaluation
• Project evaluation methods
• Portfolio theory
• Aasset pricing
• Financial intermediaries
• Sources of short term debt