【投资学英文版课件】THECONCEPTOFINVESTING.pptVIP

THE CONCEPT OF INVESTING Investing Defined Investment Alternatives Investment Alternatives Investment Alternatives Three Reasons for Investing People invest to … supplement their income earn capital gains Appreciation refers to an increase in the value of an investment. experience the excitement of the investment process The Academic Study of Investments The Academic Study of Investments The Academic Study of Investments Review Investing Defined Investment Alternatives Assets Securities Security Groupings Three Reasons for Investing Income Appreciation Excitement Review The Academic Study of Investments Theoretical Research Empirical Research Professors vs. Practitioners 1 - * Strong C1 – The Concept of Investing CHAPTER ONE Practical Investment Management Robert A. Strong To consume, to save, or to invest a dollar that is earned ? Both saving and investing amount to consumption shifting through time. However, saving involves little, if any, risk, while investing is a risky endeavor. Assets Financial Assets Real Assets e.g. bond, stock e.g. land Assets are things that people own. Financial assets have a corresponding liability, while real assets do not. Securitization is the process of converting an asset or collection of assets into a more marketable form. A security is a legal document that shows an ownership interest. Although securities are historically associated with financial assets, they are also applicable to real assets. There are three broad categories of securities. Securities Equity Securities e.g. common stock Derivative Assets e.g. futures, options Fixed Income Securities e.g. bonds, preferred stock Why invest ??? Theoretical research involves building mathematical models and proposing pricing relationships rather than studying actual market data. E.g. arbitrage relationships, impact of stock splits and cash dividends on investors Theoretical models are frequently tested by conducting empirical research. Empirical researc