bu 111 course models (first midterm)
TRANSCRIPT
DefinitionStakeholders
Mutual dependencyLegitimate expectationsConsequences of not meeting expectations
The business/stakeholder relationship
Management`s primary objective
CharacteristicsThe external business environment
Four key areasThe internal business environment
Tasks of any managerThe process of management
Definition: capital marketsUsers of capital
Financial intermediaries: definitionSuppliers of capital
Securities: definitionInternal vs. external financingOverview of the Canadian financial system
The economic environment: Canadian capital markets
Course Model Sept 21September-21-09
12:52 PM
Course Model Page 1
The economic environment: Canadian Capital
Definition: capital marketsUsers of capital
Financial intermediaries: definitionSuppliers of capital
Securities: definitionInternal vs. External financingOverview of the Canadian financial system
Markets
Why invest?Factors to consider before investing (lab manual p2)
Safety of principal (risk)Income producing capacity: dividends/interestGrowth (capital gains)
Defining characteristics of any investment
Different people/different investmentsThe fallacy of a "perfect investment"
Liquidity of an investment
What is diversification?Ways to diversify
Diversification of an investment portfolio
Taxation of investment returns
Investments: definition
Course ModelSeptember-21-09
1:37 PM
Course Model Page 2
Federal ratesOntario provincial ratesThe ontario surtax
Personal tax rate 2009
Calculating total tax payable: an example
Personal tax system vs. Corporate tax system
Marginal tax rate: definitionDetermining an investor's marginal tax rate
Taxation of interest and exampleTaxation of dividends and exampleTaxation of capital gains and exampleEffective tax rate calculationsBefore and after tax rates of return
Types of investment returns
Taxation of investment returns
Which offers the best after tax returns?Interest vs. Dividends vs. Capital gains: tax summary
The canadian tax system
Course ModelSeptember-23-09
12:54 PM
Course Model Page 3
Types of investments: Bonds (p 277-318 LM)Definition
Face valueLength of life/date of final maturityCoupon rateThe bond indentureBond trusteeOrder of liquidation
Characteristics of all bonds
Secured bondsUnsecured bonds (debentures)
Types of bonds
Reading bond quotations in the financial pressCalculating rough bond yields: examples
Course ModelSeptember-30-09
12:52 PM
Course Model Page 4
Vary inversely with interest ratesWhy?Example problems to demonstrate
Bond price movements
The callConversionExtendible and retractable feature
Features possessed by some bonds
Course ModelOctober-05-09
1:00 PM
Course Model Page 5
Fixed rate of dividendPayment of dividends is discretionaryNon-voting shares
Liquidation rightsDividend rights
Preference rights vs. Common shares
Cumulative featureParticipating featureVoting featureCall (redemption) featureConvertible feature
Characteristics possessed by some preferred shares
Common stock
Voting rights
Dividends are variable and discretionaryNo fixed rate of dividend
Liquidation rights
Characteristics of common shares
How are common share prices determined?
Alternative types of investments : preferred shares
Course ModelOctober-07-09
12:56 PM
Course Model Page 6
Bid and ask price systemMarket orders to buy and sell shares
Stock market transactions (slides on website)
A step by step example of a short saleWhat is short sale?
No theoretical limit to lossesTermination of short selling agreementsShort seller is liable for dividends
Short selling ruleShort calls
Risks associated with short selling
Short sales
Implications of buying stock on marginMargin calls
Example of margin callMargin buying rule
What is it?Margin buying
Course ModelWednesday, October 14, 2009
12:55 PM
Course Model Page 7
What is an option?Four characteristics of any option contract
Call option : a step by step examplePut option
Reading option information in the newspaper
Intrinsic valueTime value
Factors affecting option prices
Stock options (puts and calls)
Course ModelMonday, October 19, 2009
1:00 PM
Course Model Page 8
Open endedInvestors have right of redemption
Characteristics of mutual funds
Valuation of shares in a mutual fund
What is a mutual fund
Pros of investing in Mutual fundsCons of investing in mutual funds
Mutual funds
Course ModelWednesday, October 21, 2009
12:57 PM
Course Model Page 9