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Plain Talk Guide
Plain Talk Guide

... You can hold a bond until maturity or trade it on the bond market. Bonds are continually traded and their capital value changes in line with interest rates and other factors. Most traders are large banks, brokers and fund managers, which buy and sell bonds to profit from price fluctuations or genera ...
Question and Problem Answers Chapter 5
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... The SML shows us how much investors require in compensation for the systematic risk they bear. Investors require some return for postponing consumption. This return is the intercept of the SML and represents investments with no systematic risk. In other words, all investments must earn at least this ...
Operating Activities
Operating Activities

... • To qualify as a cash equivalent: 1. The item must be readily convertible to cash. 2. It must be so near to its maturity that there is insignificant risk of change in value due to changes in interest rate. ...
Imperial Money Market Pool
Imperial Money Market Pool

... registered unitholders of the Pools for the purposes of receiving all unitholder materials and having the right to vote all proxies with respect to units of the Pool. Units of the Pool are also offered to investors in connection with certain products offered by affiliated dealers pursuant to the ter ...
US P3 Market Slowly Builds on Four Fronts
US P3 Market Slowly Builds on Four Fronts

... forward with the Indianapolis Courthouse availability-payment P3 project after a preferred proponent (aka the winning bidder) had been selected and was working toward commercial and financial close. The Virginia Route 460 demand risk project was terminated in 2015 after reaching financial close and ...
T3.1 Chapter Outline
T3.1 Chapter Outline

...  capital budgeting - where and how much should we invest  long term financing - capital structure  short term financing - working capital management  risk management - derivative securities and hedging  A good working knowledge of financial statements is important ...
Accrued Interest on Debt Securities with a Fixed Rate of
Accrued Interest on Debt Securities with a Fixed Rate of

... or when it is paid for. The same applies to income: “Under investment income, interest is recorded on an accrual basis, which is the continuous method of recording that matches the cost of capital with the provision of capital. If the interest is not actually paid, an entry is required, together wit ...
FORM 10-Q - Barchart.com
FORM 10-Q - Barchart.com

... Cash Flows from Operating Activities: Net income Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization Net investment results and loss (gain) on divestitures Deferred income taxes Dividends greater than share of earnings of equity method inves ...
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Reducing the Fear of Inflation with TIPS
Reducing the Fear of Inflation with TIPS

... a lot of investors are beginning to look toward hedging against the potential of rising inflation “just in case1.” But what asset classes should investors embrace to provide inflation insurance? Gold? Commodities? Real assets? They all have their cheerleaders but for many investors, there continues ...
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... “Deutsche Bank Plans Investment Banking Push” (C3) – One of the world’s largest bank continues to deemphasize its historical core business because of uncompetitive home-market conditions for banks “Carlyle Agrees to Buy 24.9% Stake In China Pacific Life Insurance” (C4) – Further evidence of the inte ...
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... This fund invests in bonds or other types of debt. Bonds are essentially loans to companies, governments or local authorities so there's a risk that these companies or government bodies may default on the loan. Bonds are rated in terms of quality, usually from AAA down to B and below. AAA is the hig ...
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... as commercial banks, building and loan associations, licensed lenders, credit unions, credit card banks, risk managers, and insurers. Other sources of credit are non-financial, including governmental agencies, families, friends, and community-based organizations. Debt management is the ability to me ...
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Classes of Ratios

... Also take dividends shown on the income statement and adjust for changes in dividends payable on the Balance Sheet – a source, and therefore an add-back if it is an increase, or a use, and therefore a subtraction, if it declines.  Calculate Net Cash Income. Subtract financing costs from Net Cash fr ...
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Accounts and Notes Receivable

... replace an Accounts Receivable when the customer requests additional time to pay a past-due account. A promissory note is a written promise to pay a specific amount of money, usually including interest, at a future date. If the note is due within a year it is classified as a current asset. If the no ...
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Securitization

Securitization is the financial practice of pooling various types of contractual debt such as residential mortgages, commercial mortgages, auto loans or credit card debt obligations (or other non-debt assets which generate receivables) and selling their related cash flows to third party investors as securities, which may be described as bonds, pass-through securities, or collateralized debt obligations (CDOs). Investors are repaid from the principal and interest cash flows collected from the underlying debt and redistributed through the capital structure of the new financing. Securities backed by mortgage receivables are called mortgage-backed securities (MBS), while those backed by other types of receivables are asset-backed securities (ABS).Critics have suggested that the complexity inherent in securitization can limit investors' ability to monitor risk, and that competitive securitization markets with multiple securitizers may be particularly prone to sharp declines in underwriting standards. Private, competitive mortgage securitization is believed to have played an important role in the U.S. subprime mortgage crisis.In addition, off-balance sheet treatment for securitizations coupled with guarantees from the issuer can hide the extent of leverage of the securitizing firm, thereby facilitating risky capital structures and leading to an under-pricing of credit risk. Off-balance sheet securitizations are believed to have played a large role in the high leverage level of U.S. financial institutions before the financial crisis, and the need for bailouts.The granularity of pools of securitized assets can mitigate the credit risk of individual borrowers. Unlike general corporate debt, the credit quality of securitized debt is non-stationary due to changes in volatility that are time- and structure-dependent. If the transaction is properly structured and the pool performs as expected, the credit risk of all tranches of structured debt improves; if improperly structured, the affected tranches may experience dramatic credit deterioration and loss.Securitization has evolved from its beginnings in the late 18th century to an estimated outstanding of $10.24 trillion in the United States and $2.25 trillion in Europe as of the 2nd quarter of 2008. In 2007, ABS issuance amounted to $3.455 trillion in the US and $652 billion in Europe. WBS (Whole Business Securitization) arrangements first appeared in the United Kingdom in the 1990s, and became common in various Commonwealth legal systems where senior creditors of an insolvent business effectively gain the right to control the company.
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