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Finance: Financial Investment
Finance
Today's investment environment is more dynamic than it was a decade ago. This is particularly the case given that today's global economy is much more complex. Further, with information moving faster than it used to, the ripple effects of events happening in any given place are often felt in far away economies. Essentially, some of the challenges investors encountered a decade or so ago are not the same ones they encounter today. One of the key challenges in today's investment environments is sluggish global economic growth. As Connolly (2014) points out, although the trend could be changing (going by recent performance), "the U.S. economic growth rate has been relatively sluggish." Slow rate of economic growth causes significant uncertainty which is not ideal for investment. Next, it is also important to note that the volatility of equity markets has been rather extreme in the recent past. This year, there are many who expect the said volatility to continue (Connolly, 2014). Fixed income yields have also been particularly low within the last one decade. Increasing interest rates and rising inflation are the other key challenges in today's investment environment. Some of the most recent challenges, some of which we didn't see last year include, but they are not limited to;...
However, in so doing, investors ought to be aware of the risks involved with a particular class of investment, the associated fees and costs, the legitimacy of the undertaking, etc. Some of the tools a manager may use in helping an investor achieve their financial goals is diversification. By diversifying, investors could succeed in further increasing their sources of returns in an investment environment such as the one we are in. A manager could also make use of other approaches such as absolute return strategies and sector strategies (Gold, 2011). While sector strategies have got to do with asset classes, absolute return strategies "are designed to provide returns which are not highly correlated with traditional strategies and markets" (Gold, 2011, p. 36).
Question 2
My stock of choice for this analysis is Apple -- stock symbol AAPL. The company concerns itself with the manufacture and sale of a wide range of electronic devices and software.
a) Pros and Cons of the Stock
With regard to the pros, the ratio of this particular company's…
References
Connolly, M. (2014). The Stock Market in 2014: Up, but Volatile. Retrieved from www.nhbr.com/The-stock-market-in-2014-up-but-volatile/
Gold, M. (2011). Fiduciary Finance: Investment Funds and the Crisis in Financial Markets. Massachusetts: Edward Elgar Publishing.
MSN. (2014). Apple Inc. (NASADAQ: AAPL). Retrieved from http://investing.money.msn.com/investments/stock-ratings/?symbol=AAPL
"Pension reform in several emerging market countries has been associated with rapid growth in assets under management and a positive impact on the development of local securities markets." (Roldos, 2004) Finally, the stability of many international securities, located in Britain, Switzerland, or Germany, to take only a few examples, means that using the diverse potential of international investment opportunities does not necessarily entail a high risk. However, many international sources
The success rates of this venture are increased as investors are willing to risk their money in the hope of increased gains. Otherwise put, shareholders "can accept downside risks because they fully share the upside as well" (Dynamic Equity, 2002). Regardless of the sources used in contracting the necessary money, the organization would still have to retrieve a minimum of $40 million revenues during the first year in order
Financial Risk The financial ratio categories are Liquidity, Activity, Profitability, and Coverage (Kieso, Weygant, & Warfield, 2008). These ratios are comparisons of different financial accounts that show financial performance measures in different areas. Fluctuations of these ratios can be red flags. These fluctuations can show increases or decreases in performances. Increases could indicate growth, but decreases could show negative signs in performance levels that need to be analyzed and addressed. Liquidity,
Functional Perspective Though financial systems change over time, their functional perspectives do not. Operational financial systems are expected to be similar in all economies, hence, its necessitated reliability in the system. A functional perspective is mainly used in doing financial analysis in a financial system. It provides a foundation for referring to a country's financial system. The financial perspective also assists in evaluating the system actions. Using a financial perspective in
Financial Analysis of Bestwish Limited Company Overview Bestwish Limited produces extensive range of quality products such as gift dressing, greetings cards, and plush merchandise of more than 50,000 stocks. The production of different categories of products involve between 2 and 15 processes. The company produces standardized products and custom designed products ordered from customers on contract basis. However, Bestwish Limited is facing challenges to control the costs because of varying production process,
Financial Management Decision Understanding Basic Finance Terms Generally, it is beneficial to have a basic understanding of financial concepts and terminology before going into business independently. Financial management refers to the process of calculating anticipated sources of profit and comparing them to anticipated expenses and other variables and contingencies. In principle, financial management is used to determine what prospective ventures are likely to be profitable and to identify those that are too