# on 30-Oct-2016 (Sun)

#### Annotation 1328543042828

Discounted Cash Flow Applications
#analyst #has-images #notes #quantitative-methods-basic-concepts

#### Holding Period Return

When analyzing rates of return, our starting point is the total return, or holding period return (HPR). HPR measures the total return for holding an investment over a certain period of time, and can be calculated using the following formula:

• Pt = price per share at the end of time period t
• P(t-1) = price per share at the end of time period t-1, the time period immediately preceding time period t
• Pt - Pt-1 = price appreciation of the investment
• Dt = cash distributions received during time period t: for common stock, cash distribution is the dividend; for bonds, cash distribution is the coupon payment.

It has two important characteristics:

• It has an element of time attached to it: monthly, quarterly or annual returns. HPR can be computed for any time period.
• It has no currency unit attached to it; the result holds regardless of the currency in which prices are denominated.

Example

#### Annotation 1329353854220

 Subject 5. Orders #analyst-notes #market-organization-and-structure Orders are instructions to trade. They always specify instrument, side (buy or sell), and quantity. Bid price: the highest price that a buyer wants to pay for the instrument. The best bid is the highest bid in the market.Ask price: the lowest price a seller is willing to accept for the instrument. Also called offer price. The best offer is the lowest in the market.Bid-ask spread: the difference between the best bid and the best offer. Orders usually also provide several other instructions. Execution Instructions They indicate how to fill the order. Market orders are simple buy or sell orders that are to be executed immediately at current market prices. They provide immediate liquidity for someone willing to accept the prevailing market price. A limit order is an order that sets the maximum or minimum at which you are willing to buy or sell a particular stock. For instance, if you want to buy stock ABC, which is trading at $12, you can set a limit order for$10. This guarantees that you will pay no more than $10 to buy this stock. Once the stock reaches$10 or less, you will automatically buy a predetermined amount of shares. On the other hand, if you own stock ABC and it is trading at $12, you could place a limit order to sell it at$15. This guarantees that the stock will be sold at $15 or more. The primary advantage of a limit order is that it guarantees that the trade will be made at a particular price; however, it's possible that your order will not be executed at all if the limit price is not reached. Traders choose order submission strategies on the basis of how quickly they want to trade, the prices they are willing to accept, and the consequences of failing to trade. Validity Instructions They indicate when the order may be filled. A day order (the most common) is a market or limit order that is in force from the time the order is submitted to the end of the day's trading session. A good-till-canceled order requires a specific canceling order. It can persist indefinitely (although brokers may set some limits, for example, 90 days). An immediate-or-cancel order (IOC) will be immediately executed or canceled by the exchange. Unlike a fill-or-killorder, IOC orders allow for partial fills. An order may be specified on the close or on the open, then it is entered in an auction but has no effect otherwise. Different types of orders allow you to be more specific about how you'd like your broker to fulfill your trades. When you place a stop or limit order, you are telling your broker that you don't want the market price (the current price at which a stock is trading), but that you want the stock price to move in a certain direction before your order is executed. With a stop order, your trade will be executed only when the security you want to buy or sell reaches a particular price (the stop price). Once the stock has reached this price, a stop order essentially becomes a market order and is filled. For instance, if you own stock ABC, which currently trades at$20, and you place a stop order to sell it at $15, your order will only be filled once stock ABC drops below$15. Also known as a "stop-loss order", this allows you to limit your losses. However, this type of order can also be used to guarantee profits. For example, assume that you bought stock XYZ at $10 per share and now the stock is trading at$20 per share. Placing a stop order at $15 will guarantee profits of approximately$5 per share, depending on how quickly the market order can be filled. Stop orders are particularly advantageous to investors who are unable to monitor their stocks for a period of time, and brokerages may even set these stop orders for no charge. One disadva...

#### Annotation 1329355689228

 Subject 6. Primary security markets #analyst-notes #market-organization-and-structure The primary markets are those in which new issues of bonds, preferred stock, or common stock are sold by government units, municipalities, or companies to acquire new capital. New issue.Key factor: issuer receives the proceeds from the sale. Two important rules in the primary capital markets: Rule 415 allows large firms to register security issues and sell them in piecemeal over the following two years. Such issues are called shelf-registration. It allows a single registration document to be filed that permits the issuance of multiple securities.Rule 144A allows corporations (including non-U.S. firms) to place securities privately with large, sophisticated investors. The issuer of a private placement reduces issuing costs because it does not have to complete the extensive registration documents. However, investors will require a higher return since no secondary market exists and thus the liquidity risk is high. New stock issues are divided into two groups: Initial public offerings (IPOs). These are new shares that a firm offers to the public for the first time. They are typically underwritten by investment bankers through negotiated arrangements (the most common form), competitive bids and best-effort arrangements (investment bankers act as brokers, not taking the price risk).Seasoned equity issues. These are new shares issued by firms that already have stocks outstanding. A rights issue is an option that a company can opt for to raise capital under a secondary market offering or seasoned equity offering of shares to raise money. It is a special form of shelf offering or shelf registration. With the issued rights, existing shareholders have the privilege to buy a specified number of new shares from the firm at a specified price within a specified time. Government bond issues are sold at Federal Reserve auctions.

#### Annotation 1329359359244

 Subject 8. Well-functioning financial systems #analyst-notes #market-organization-and-structure Well-functioning financial systems have the following characteristics: Complete markets. The instruments needed to solve investment and risk management problems are available to trade. Liquidity. As asset can be bought and sold quickly (that is, it has marketability, which means an asset's likelihood of being sold quickly.) at a price close to the prices for previous transactions (price continuity), assuming no new information has been received. In turn, price continuity requires depth, which means the numerous potential buyers and sellers must be willing to trade at prices above and below the current market price. Operational efficiency. Low transaction costs (as a percentage of the value of the trade) include the cost of reaching the market, the actual brokerage costs, and the cost of transferring the asset. This attribute is often referred to as internal efficiency. Informational (or external) efficiency. Timely and accurate information is available on the price and volume of past transactions and the prevailing bid-price and ask-price. Prices rapidly adjust to new information; thus the prevailing price is fair because it reflects all available information regarding the asset. Prices will be most informative in liquid markets because information-motivated traders will not invest in information and research if establishing positions based on their analysis is too costly. A well-functioning financial system promotes wealth by ensuring that capital allocation decisions are well made. It also promotes wealth by allowing people to share the risks associated with valuable products that would otherwise not be undertaken.

#### Annotation 1329361194252

 Subject 9. Market regulation #analyst-notes #market-organization-and-structure Regulators generally seek to promote fair and orderly markets in which traders can trade at prices that accurately reflect fundamental values without incurring excessive transaction costs. Governmental agencies and self-regulating organizations of practitioners provide regulatory services that attempt to make markets safer and more efficient. The objectives of market regulation are to: control fraud. Customers may not know how to protect themselves since the financial markets are quite complex.control agency problems. Financial agents often have different goals from their customers. How to effectively measure the services they provide?promote fairness. For example, insider trading is prohibited in most markets as it offends basic notions of fairness.set mutually beneficial standards. Common financial standards allow investors to compare companies easily.prevent undercapitalized financial firms from exploiting their investors by making excessive risky investments.Regulators generally require that financial firms to maintain minimum levels of capital to reduce the probability that these firms will fail and hurt their customers.ensure that long-term liabilities are funded. Insurance companies and pension funds need to maintain adequate reserves to ensure they can pay their liabilities when due.

#### Flashcard 1410338000140

Tags
#obgyn
Question
Non-invasive prenatal genetic screening should be offered to who?
every pregnant woman

status measured difficulty not learned 37% [default] 0

#### Flashcard 1410341670156

Tags
#ankle
Question
What is a grade 1 ankle sprain ?
Partial rupture of the anterior talofibular ligament and/or the calcaneofibular ligament

status measured difficulty not learned 37% [default] 0

#### Flashcard 1410346126604

Tags
#obgyn
Question
NIPT (Non-Invasive Prenatal Testing):
• Peripheral blood test which analyzes [...] in the maternal circulation
• Screens abnormalities of chromosomes 21, 18, 13, X and Y
• Very high detection rate for Down Syndrome (>99%), as well as Trisomy 18 and 13 when validated in high-risk pregnancies
• Applicable for singleton and uncomplicated twin pregnancies from about 10 weeks