Flashcards in Exam 1 Deck (40)
Money Markets vs. Capital Markets
What is an example of the largest Capital Market?
New York Stock Exchange NYSE
2 stock exchanges that have a physical location?
New York Stock Exchange (NYSE)
American Stock Exchange (AMEX)
-no physical location
-National Association of Securities Dealers Automated Quotation
-is a network of computers
When did the AMEX and the NASDAQ merge and split?
merged in 1998
split in 2005
-if inflation is expected to rise, then Yield curve goes up
-if inflation is expected to go down, then Yield Curve goes down
Maturity Risk Theory
Says as the maturity date increases there is an upward push on the yield curve due to the risk
Technological advances in computers and telecommunications, along with the globalization of banking and commerce has led to what?
-increased competition through the world
How does large amounts of capital moving around the world is response to changes in interest rates/exchange rates affect local economies?
It disrupts them
-Net Operating Working Capital
CA - ( AIP + Accurals)
Net Operating Profit after tax
-buys majority of IPO of company
-company just coming to market
-tries to gain control of company
-Company that buys another company
-to prevent hostile takeover from third-party(bad) company
If U.S. interest rates are High, what will foreign people do? What will it do to the purchasing power of the U.S. dollar?
-Foreign people will invest in U.S.
-Purchasing power goes up
If inflation increases, what will this do to the interest rate?
Interest rate will increase
Who is responsible for a firm's strategic decisions?
Chairmen of the Board
Who is responsible for a firm's actual operations, such as buying/selling a firm's products?
Chief Operations Officer (COO)f
What is the Compensation Committee?
-sets compensation packages for senior officers
-made up 3 non-employee people
When can Mutual Funds be traded during the day? When can ETFs be traded?
-only traded at end of day
-can be traded like a stock
-create new products for investors
-credit unions, JP Morgan, Fidelity, Commercial banks
Which is more regulated, Hedgefunds or Mutual Funds?
How many seats does the NYSE have?
Dimensions of window?
Dimensions of skylight?
96 by 50ft WINDOW
30 by 30 SKYLIGHT
Date NYSE was created?
May 17, 1792
How did people first meet up to trade stocks with NYSE?
Around a Buttonwood/Sicklemore tree
AMEX merged with ___ in 2008. However, they did not integrate until into ___ until ___
Merged with Euronext in 2008
Integrated into NYSE in 2009
Year that NASDAQ was created
If EVA is positive, what does that mean about the ROE
ROE exceeds the Cost of Equity
Who built the NYSE window and in what year?
George Post 1903
Efficient Markets Hypothesis
-says stocks are always in equilibrium
-impossible for investor to consistently beat the market
-economic value added
-used to determine managerial compensation
-good correlation of stock price
-good measure to shareholder value
Europe's dollar has increased from $1.09 to $1.24.
How does this affect the U.S.
Means U.S. is not buying as much stuff from Europe
___ who works for Goldman Sachs, went on CNBC and asked how computer stocks were valued
Abby Joseph Cohen
What is the average PE of the S and P500
What was the date of NASDAQ's peak? What was it's value?
NASDAQ hit a peak of 5100 and then went down to ___
The Federal deficit was ___ in 2006 and ___ in 2018.
762Billion in 2006
800 Billion in 2018
Since the economic crisis of 2008, how many quantitative easing programs has the government conducted? When did the last on end
NASDAQ acquired the ___ and 25% of the ___
Philadelphia Stock Exchange
25% of London Stock exchange
How many stocks does the Dow Jones Industrial average