Investments Principles of Portfolio and Equity Analysis

by McMillan, Michael; Pinto, Jerald E.; Pirie, Wendy L.; Van de Venter, Gerhard; Kochard, Lawrence E.

• ISBN13: 9780470915806
• ISBN10: 0470915803
• Edition: 1st
• Format: Hardcover
• Copyright: 2011-02-08
• Publisher: Wiley

Summary

A comprehensive guide to investment analysis and portfolio management by an expert team from the CFA InstituteIn a world of specialization, no other profession likely requires such broad, yet in-depth knowledge than that of financial analyst. Financial analysts must not only possess a broad understanding of the financial markets-including structure, organization, efficiency, portfolio management, risk and return, and planning and construction-but they must also have a strong sense of how to evaluate industries and companies prior to engaging in an analysis of a specific stock. Investments: Principles of Portfolio and Equity Analysis provides the broad-based knowledge professionals and students of the markets need to manage money and maximize return. The book Details market structure and functions, market anomalies, secondary market basics, and regulation Describes investment assets and asset classes, types of positions and orders, as well as forecasting methodologies Discusses return and risk characteristics, portfolio diversification and management, the basics of both technical analysis and major technical indicators, and much more A companion Workbook, which includes learning outcomes, summary overviews, and problems and solutions sections is available and sold separatelyInvestments provides readers unparalleled access to the best in professional quality information on investment analysis and portfolio management.

Author Biography

MICHAEL G. MCMILLAN, CFA is Director, Ethics and Professional Standards in the Education Division of CFA Institute. Dr. McMillan joined CFA Institute in 2008 after more than a decade as a professor of accounting and finance at Johns Hopkins University's Carey Business School and The George Washington University's School of Business. He has a doctorate in accounting and finance from The George Washington University, an MBA from Stanford University, and a BA from the University of Pennsylvania. Dr. McMillan is a member of the CFA Society of Washington, DC and the East African Society of Investment Professionals.

JERALD E. PINTO, CFA is Director, Curriculum Projects, in the Education Division of CFA Institute. Before coming to CFA Institute in 2002, he consulted to corporations, foundations, and partnerships in investment planning, portfolio analysis, and quantitative analysis. He has also worked in the investment and banking industries in New York City and taught finance at New York University's Stern School of Business. He holds an MBA from Baruch College, a PhD in finance from the Stern School, and earned his CFA charter in 1992.

WENDY L. PIRIE, CFA is Director, Curriculum Projects, in the Education Division of CFA Institute. Prior to joining CFA Institute in 2008, she taught finance, accounting, statistics, taxation, business law, and marketing for over twenty years at both large and small, public and private universities, religious colleges, and military academies. Her work has been published in Journal of Financial Research and Journal of Economics and Finance. She holds a PhD from Queen's University in Kingston, Ontario and MBAs fromthe Universities of Toronto and Calgary.

GERHARD VAN DE VENTER, CFA is Deputy Head of the School of Finance and Economics at University of Technology, Sydney. He was previously director, Curriculum Projects, in the Education Division of CFA Institute. He began his career in South Africa as a financial analyst and later as a dealer at the Bond Exchange, where he traded fixed income securities. He holds a PhD in finance from the University of Technology, Sydney. He is a member of CFA Institute and the New York Society of Security Analysts.

Table of Contents

Foreword

Introduction

Market Organization and Structure

Learning Outcomes

Introduction

The Functions of the Financial System

Assets and Contracts

Financial Intermediaries

Positions

Orders

Primary Security Markets

Secondary Security Market and Contract Market Structures

Well-Functioning Financial Systems

Market Regulation

Summary

Problems

Security Market Indices

Learning Outcomes

Introduction

Index Definition and Calculations of Value and Returns

Index Construction and Management

Uses of Market Indices

Equity Indices

Fixed-Income Indices

Indices for Alternative Investments

Summary

Problems

Market Efficiency

Learning Outcomes

Introduction

The Concept of Market Efficiency

Forms of Market Efficiency

Market Pricing Anomalies

Behavioral Finance

Summary

Problems

Portfolio Management: An Overview

Learning Outcomes

Introduction

A Portfolio Perspective on Investing

Investment Clients

Steps in the Portfolio Management Process

Pooled Investments

Summary

Problems

Portfolio Risk and Return: Part I

Learning Outcomes

Introduction

Investment Characteristics of Assets

Risk Aversion and Portfolio Selection

Portfolio Risk

Efficient Frontier and Investor's Optimal Portfolio

Summary

Problems

Portfolio Risk and Return: Part II

Learning Outcomes

Introduction

Capital Market Theory

Pricing of Risk and Computation of Expected Return

The Capital Asset Pricing Model

Beyond the Capital Asset Pricing Model

Summary

Problems

Basics of Portfolio Planning and Construction

Learning Outcomes

Introduction

Portfolio Planning

Portfolio Construction

Summary

Problems

Overview of Equity Securities

Learning Outcomes

Introduction

Equity Securities in Global Financial Markets

Types and Characteristics of Equity Securities

Private versus Public Equity Securities

Investing in Non-Domestic Equity Securities

Risk and Return Characteristics of Equity Securities

Equity Securities and Company Value

Summary

Problems

Introduction to Industry and Company Analysis

Learning Outcomes

Introduction

Uses of Industry Analysis

Approaches to Identifying Similar Companies

Industry Classification Systems

Describing and Analyzing an Industry

Company Analysis

Summary

Problems

Equity Valuation: Concepts and Basic Tools

Learning Outcomes

Introduction

Estimated Value and Market Price

Major Categories of Equity Valuation Models

Present Value Models: The Dividend Discount Model

Multiplier Models

Asset-Based Valuation

Summary

Problems

Equity Market Valuation

Learning Outcomes

Introduction

Estimating a Justified P/E Ratio

Top-down and Bottom-up Forecasting

Relative Value Models

Summary

Problems

Technical Analysis

Learning Outcomes

Introduction

Technical Analysis: Definition and Scope

Technical Analysis Tools

Elliott Wave Theory

Intermarket Analysis

Summary

Problems

Glossary

References

About the Authors

About the CFA Program

Index

Table of Contents provided by Publisher. All Rights Reserved.