While this strategy is effective in some situations, the use of bond markets by an investor requires the development of an effective strategy that will help him/her to achieve a specific financial objective. For an investor seeking to maximize the profit-generating aspects of bonds, the most effective strategy is a passive buy-and-hold bond strategy. As the name suggests, it involves buying individual bonds and holding them until maturity. The
Markets stock markets struggled towards the end of the month in April. Yousuf (2012) reports that the Dow Jones Industrial Average was flat for the month, the S&P 500 posted a minor loss and the NASDAQ dropped 1.5%. All three indices were down for the final week of the month. One of the reasons why the markets struggled during the week was that a report revealed that the GDP grew at
The decision of investing or not here then depends on the personal adversity to risk of each individual investor. The general theory states that each investor should construct a diversified portfolio, which adequately balances high risk-high gain shares with medium or even low rates of risk and gains (Hagin, 2004). New Zealand could then be assimilated with a medium risk-medium gain share, and as such would be perceived as
Financial markets and securities are very important to business and to society in general. It is therefore worthwhile to examine the relationships that these terms have with each other. The purpose of this essay is to highlight and explain some of the important factors of financial markets and their relationship to the business sector and the economy in general. I will first define the key terms involved before demonstrating the
In addition, the exchange provides an avenue for recourse if some remedy is required for a fraudulent transaction. Problem 15-12. The operating asset turnover of 5 times on operating assets of $20 million implies a total sales of $100 million. The return on operating assets being 25% indicates net profit of $5 million. The total costs therefore are $95 million. DOL = Contribution Margin / Operating Margin In this case, the operating margin
Financial System financial markets are the places where capital exchanges hands. Those with capital to invest are able to invest in businesses that are seeking capital. The same occurs with financial institutions as intermediaries. The result is that the economy benefits significantly from this arrangement. People with good ideas are able to raise capital in order to bring those ideas to market. For businesses, the U.S. financial markets are a source