Personal Investing

by Lum, Leslie

• ISBN13: 9780324101546
• ISBN10: 0324101546
• Format: Paperback
• Copyright: 2002-03-05
• Publisher: South-Western College Pub

Summary

This product provides an online solution for teaching personal investments. Using a how-to approach, it teaches the basics of investing through online text, graphics, exercises, in-class investing projects, and self-testing.

Table of Contents

Preface	p. xi
Why Are You Here?	p. 1
Why Are You Here?	p. 1
Turning You into a Rationl Investor	p. 2
Know Yourself	p. 3
Start Saving	p. 4
Lay Out Your Goals	p. 5
Save Every Year	p. 7
Planning for Uncertainty	p. 8
Your Plan	p. 10
Your Personal Financial Plan	p. 13
Markets Rise and Markets Fall	p. 17
How Do Markets Move?	p. 17
What Is the Economy?	p. 18
The Economy Rises and the Economy Falls	p. 18
Businesses Rise and Businesses Fall	p. 19
Inflation Rises and Inflation Falls	p. 21
Interest Rates Rise and Interest Rates Fall	p. 24
Markets Rise and Markets Fall	p. 25
Monitoring the Economy	p. 27
Your Portfolio and Economic Events	p. 27
Risk/Return	p. 33
Return	p. 33
Real Return	p. 43
Risk	p. 46
The Relationship Between Risk and Return	p. 57
Your Portfolio and Risk/Return	p. 59
Bonds	p. 77
What Are Bonds?
What Is a Bond?	p. 77
Why Do Companies, Governments, etc. Issue Bonds?	p. 79
How Have Bonds Done as Investments?	p. 79
How Do You Make Money from Bonds?	p. 80
Calculating Bond Capital Gains or Losses	p. 81
Calculating Yield	p. 82
Choices
What Are Your Choices?	p. 85
U.S. Treasury	p. 85
Municipal Bonds	p. 87
Mortgage Securities	p. 88
Corporate Bonds	p. 89
Maturity	p. 90
Zero Coupon	p. 91
Credit Rating	p. 92
Bond Funds	p. 94
Buying Bonds	p. 96
Evaluate	p. 98
Yield Curve Strategies	p. 100
Monitoring Bonds	p. 100
Your Portfolio and Bonds	p. 103
Stocks	p. 117
What Are Stocks?
What Is a Stock?	p. 117
Why Do Companies Issue Stock?	p. 118
How Do You Make Money on Stocks?	p. 118
How Have Stocks Done?	p. 119
Choices
Stock Categories	p. 121
Common Stock	p. 123
Preferred Stock	p. 124
Tracking Stocks and Spin-Offs	p. 125
Stock Splits	p. 127
Initial Public Offerings (IPOs)	p. 128
Buying
How Do You Buy Stocks?	p. 130
Securities and Exchange Commission (SEC)	p. 134
The Stock Exchanges	p. 135
Stock Ownership	p. 140
Evaluate	p. 142
Monitoring Stocks	p. 143
Your Portfolio and Stocks	p. 149
Sectors	p. 161
What Are Sector Investments?
What Is an Industry?	p. 161
What Is a Sector?	p. 162
Choices
What Industries and Sectors Can You Select From?	p. 163
Buying
How Do You Buy?	p. 164
Evaluate
Size and Growth	p. 165
Value	p. 167
Relationship to the Business Cycle	p. 168
Regulations and Law	p. 169
Industry Dynamics	p. 170
Relative Performance	p. 170
Monitoring Industries	p. 171
Your Portfolio and Sectors	p. 172
Fundamental Analysis	p. 177
What Is Fundamental Analysis?	p. 177
How Do You Do Fundamental Analysis?	p. 179
Fundamental Analysis of Costco	p. 195
Your Portfolio and Fundamental Analysis	p. 201
Ratio Analysis	p. 213
Financial Ratio Analysis	p. 213
Valuation Ratios	p. 214
Profitability Ratios	p. 221
Management Effectiveness Ratios	p. 223
Financial Health Ratios	p. 224
Operating Efficiency Ratios	p. 225
Analyst Ratings	p. 226
Your Portfolio and Ratio Analysis	p. 228
International	p. 233
What Are International Investments?
What Is International Investing?	p. 233
Why Invest Internationally?	p. 234
How Have International Investments Done?	p. 237
Choices
Types of International Investments	p. 238
Buying
How Do You Buy?	p. 246
Evaluate
Evaluating Your International Investments	p. 251
Investing for Growth	p. 252
Assessing Political Risk	p. 253
Assessing Currency Risk	p. 253
Diversification	p. 256
Monitoring International Investments
Monitoring Economic and Political Risk	p. 261
Monitoring Performance	p. 261
Monitoring Risk, Return, and Correlation	p. 261
Your Portfolio and International Investments	p. 263
Funds	p. 273
What Are Funds?
What Are Funds?	p. 273
Why Invest in Funds?	p. 274
How Have Funds Done?	p. 275
Choices
Types of Funds	p. 278
Fund Objective	p. 282
Fund Families	p. 287
Buying
Buying Mutual Funds	p. 288
Buying Closed-End Funds	p. 290
Exchange-Traded Funds (ETFs)	p. 290
Evaluate
Actively Managed Versus Index Funds	p. 291
Objective	p. 292
Fund Performance	p. 293
Fund Size and Fund Age	p. 295
Portfolio Manager	p. 296
Fees and Expenses	p. 296
Portfolio	p. 297
Risk and Market Correlation	p. 298
Monitoring Funds	p. 299
Your Portfolio and Funds	p. 301
Asset Allocation	p. 311
What Is Asset Allocation?	p. 311
What Can You Select From?	p. 312
Why Asset Allocate?	p. 312
Personal Risk Considerations	p. 319
Life Cycle Asset Allocation	p. 320
Risk/Return Asset Allocation	p. 321
Tactical Asset Allocation	p. 323
Dynamic Asset Allocation	p. 324
Monitoring Asset Allocation	p. 324
Your Portfolio and Asset Allocation	p. 325
Investment Advice	p. 335
Sources of Investment Advice	p. 335
What Is an Investment Advisor?	p. 336
What Can You Select From?	p. 337
Investment Clubs	p. 340
Investment Message Boards	p. 340
Online Trading	p. 341
Day Trading	p. 343
How Do You Select an Advisor?	p. 344
Before You Sign Anything	p. 345
Before You Invest	p. 346
Monitoring Advisors	p. 346
Your Portfolio and Investment Advice	p. 347
Savings Plans	p. 353
What Is Saving?	p. 353
Why Save?	p. 355
Pre-Tax Versus After-Tax Savings	p. 357
Types of Retirement Plans	p. 358
Defined Benefit Plans	p. 359
Defined Contribution Plans	p. 360
IRA	p. 361
Investment Choices	p. 362
Monitoring Savings Plans	p. 362
Your Portfolio and Savings Plans	p. 362
Options	p. 367
What Are Options?
What Is an Option?	p. 367
Why Options?	p. 369
How Do You Make Money on Options?	p. 369
Calls	p. 371
Puts	p. 372
How Are Prices Set?	p. 373
Choices
What Can You Select From?	p. 376
Employee Stock Options	p. 378
Buying
How Do You Buy?	p. 379
Placing the Order	p. 381
Exercising an Option	p. 382
Evaluate
Strategies	p. 382
Monitoring Options	p. 383
Your Portfolio and Options	p. 383
Technical Analysis	p. 391
What Is Technical Analysis?	p. 391
Dow Theory	p. 392
Trends	p. 394
Resistance and Support Levels	p. 396
Head and Shoulders	p. 397
Moving Averages	p. 399
Strategies	p. 401
Monitoring Technical Analysis	p. 402
Glossary	p. 405
Index	p. 419
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