Skip to main content

SECURITIES MARKET

SECURITIES MARKET

A market where securities are sold and purchased is called security market. There are five types of market.

  • Primary Market: where first time company issue its securiteis
  • Secondary Market: issued securiteis are sold and purchased
  • Money Market: T.bill or commercial paper less than or equal to one year
  • Capital Market
  • Over the Counter Market (OTC): electronicaly


Primary Market:
The market where the company issued securities for the first time. Two types of way to issue shares

  • Direct Placement
  • Indirect Placement


Direct Placement:
In direct placement the company issue securities directly to the invstor.The company cannot use intermediaries for selling thair securites.
direct placement
IPO= intial public offering
The price at which the company issue its security first time in the market is called IPO

Indirect Placement:
When the company issued its security for the first time in the market by useing the intermedires is called indirect placement.

indirect placement

Incestment Banks:
under writing on low price
best effort offering (bank face the risk)


INVESTMENT AND PORTFOLIO MANAGEMENT
INVESTMENT VS SPECULATION AND GAMBLING
TYPES OF INVESTOR
INVESTMENT COMPANIES
TYPES OF MUTUAL FUNDS
TYPES OF BONDS FUNDS
MONEY MARKET FUNDS
SECURITIES MARKET
TYPES OF INDEX
TYPES OF BROKERS
BROKER'S ACCOUNT
MARGINAL ACCOUNT
ORDER AND ITS TYPES
RISK AND ITS TYPES
RETURN PORTFOLIO ANALYSIS
RISK PORTFOLIO ANALYSIS
RISK AND RETURN OF AN INDIVIDUAL SECURITIES
ANALYSIS OF COMMON STOCK VALUATION
CAPM MODEL (CAPITAL ASSET PRICING MODEL)
MARKOWITZ MODEL


MBA NOTES INVESTMENT AND PORTFOLIO MANAGEMENT

Comments

Popular posts from this blog

MARKOWITZ MODEL

MARKOWITZ MODEL Portfolio Selection: If number of portfolio we use this method to select the portfolio. for example groups of protfolios sample A:  NBP, Nestle B:  NBP, Nestle, MCB C:  Lucky, Nestle Feasible Set of Portfolio: The number of portfolio which are available for their selection Efficent Portfolio: (Max. return, less risky) The portfolio which is selected from the feasible set of protfolio. Decision Rules 1: If the different portfolio have same return then we select that portfolio who's risk is minimum. Decision Rules 2: If the different protfolio have same risk then we should select that portfolio who's return is maximum. Draw Back: This model just focus only those portfolio who's return are same or risk are same. It ignore the other portfolio. Example: No. of Portfolio          Return          Risk A                       ...

RETURN PORTFOLIO ANALYSIS

RISK AND RETURN  PORTFOLIO ANALYSIS To check how much return and risk will be faced by investor on portfolio investment is called risk and return protfolio analysis In this question we show only how to calculate return. Suppose after analysis we get these results     Pepsi E(R) = 12%    S.D= 9%        amount=50000 Nestle E(R) = 20%  S.D= 12%       amount=30000 Lucky Cement = E(R) = 10%  S.D= 5%     amount=20000 what will be tatal risk and return? Portfolio Return: R p = ∑W x  E (R)  Rp = Return on portfolio E(R) = Expected return ∑W = weights what formula will be for three securite return calculation Rp = Wa x  E (R)a + Wb x  E (R)b +Wc x  E (R)c Weight: The portion of your investment amount invest in a single security is called weight. Weight of single security = single security amount / total all securities amount Tatal amount = 50000 + 300...

CAPM MODEL (CAPITAL ASSET PRICING MODEL)

According to this model company have to face two main types of risk. Risk= Systematic + un-systematic Systematic Risk: The risk face by the company due to its external environment is called systematic risk. This risk cannot be controled by the company. Example: Pocitical instability, war in the country, energy crises in the country etc. Un-Systematics Risk: The risk face by the company due to its internal environment is called un-systematic risk.This risk can be conroled by the company. Example: shortage of employees, Clash between the management etc. CAP MODEL: A model which shows the relationship between the systematic return and not shows un-systematic. _ R = R f + ( R m - R f) x    β (beta) _ R = Return (expected) R f = Risk free Return The minimum return which is desire by the investor R m = Market Return The return which is provided by the market β = systematic Risk Note = when minimum then always keep the Rf value less and Rm val...