Finance Term Paper - 738 Words

University of Texas at Dallas Jindal School of Management FIN4300 Problem Set #3 Fall 2014 Important note: Please submit paper copy of your solutions Due Dates: Dec. 8 for Section 002 and Section 501; Dec. 9 for Section 001 (all in-class) 1. Suppose you are a portfolio manager at Paulson Co. Inc. Today is the last day of April 2013. Your portfolio did not do well in the most recent month. After learning about the post earnings announcement drift, you decide to give it a try. You gather most recent earnings information on 100 stocks as of April 30 2013. After examining the earnings surprises, you decide to buy an equally weighted portfolio of the top 10 stocks with the most positive earnings surprises. At the same time,†¦show more content†¦(a) What is the annual coupon payment of a bond that trades at par and has the yield to maturity equal to the interest rate, 4%? The bond has a face value of $1,000 and pays annual coupons. (b) What is the price of an annual coupon bond with a face value of $1,000, a coupon rate of 10%, and 30 years to maturity? 1 4. Suppose the term structure of interest rates are not ï ¬â€šat. The one year spot rate, r1 , is 6.01%/year, the two-year and the three-year spot rates, r2 and r3 , are both 5%/year. (a) What are the forward interest rates for the second and the third year? (b) Consider a zero-coupon bond with the face value of $1,000 and three years to maturity. What should be the bond price today? 5. In your calculations, please round computed prices to the second decimal place (e.g., 220.78 instead of 220.7765). A risk-free annuity A pays two annual payments of $100 (the ï ¬ rst payment is made in a year). (a) If the term structure of interest rates is ï ¬â€šat and the interest rate is 61.80%/year, what is the price of the annuity? (b) What is the yield to maturity of the annuity? (c) The term structure suddenly changes and now the spot interest rate for one year (r1 ) is 80%/year and the spot interest rate for two years (r2 ) is 50%/year. As it turns out, the price of the annuity stays the same as in part (a). What is the yield to maturity of the annuity now? (d) Suppose that there are twoShow MoreRelatedDeviance Paper1765 Words   |  8 Pagessociety is academic dishonesty, or cheating as it relates to term papers. Through an analysis of the various avenues of plagiarism available for term papers online, we will better be able to understand the factors surrounding this epidemic tempting students’ nationwide. Type in â€Å"term paper† in the googler (google.com) and you are inundated with millions of results saturated by â€Å"paper mills† offering you a variety of plagiarized papers and services for a few greenbacks. A few years back, a lot ofRead MoreSample Essay1236 Words   |  5 PagesSample Essay on FINANCE: How to calculate the return on an investment (ROI) Research Paper Example of Research Paper, Sample essay Without calculating the return on an investment (ROI) is not possible to realize any marketing activity and be sure not to loose capital investments. It is essential for making one’s marketing activity more effective and uniquely productive. ROI can be expressed for different time periods: one year, one month, one week, one day. This makes it a necessary objective analystRead MoreFin 370 Syllabus Essay examples1359 Words   |  6 Pages | | |Finance for Business | Copyright  © 2012, 2011, 2010, 2008, 2006 by University of Phoenix. All rights reserved. Course Description This course introduces the student to the essential elements of finance for business. Emphasis is placed on financial management, financial markets, and the tools, techniques, and methodologiesRead MoreUniversity of Phoenix Corporate Finance Syllabus1329 Words   |  6 PagesSyllabus School of Business FIN/571 Version 5 Corporate Finance | Copyright  © 2011, 2010, 2009, 2008 by University of Phoenix. All rights reserved. Course Description This course applies corporate finance concepts to make management decisions. Students learn methods to evaluate financial alternatives and create financial plans. Other topics include cash flows, business valuation, working capital, capital budgets, and long-term financing. Policies Faculty and students/learners willRead MoreHow The Bank Rescue Schemes In France And Germany?1134 Words   |  5 PagesIn this paper Woll compares the different bank rescue schemes in France and Germany during the global financial crisis of 2008-2009. 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Finance Finances are the studies and addresses the ways in which individuals, businesses, and organizationsRead MoreFinancial Statement Thesis Statement767 Words   |  4 Pagesthe Ph.D. program at Carroll School will help my professional experience and academic training come together in the long term - My long term career goal is to become a Finance Professor to teach, conduct research, and produce research publications that would add value and contribute to my field of specialization. At Carroll School, I intend to concentrate in Behavior Finance and Comparative Study between Developed and Emerging Financial Markets. I have over 15 years stock investment experience inRead MoreQuestions On Non Financial Firms1468 Words   |  6 Pagesa negative shock to the supply of external finance needed by non-financial firms. However, as the two quotes by some leading policymakers and scholars at the beginning of the paper indicate, the idea that non-financial firms suffer from a strongly negative supply-of-finance shock is not universally shared. In addition, if non-financial firms do not do well, there can certainly be other causes, such as a contraction of demand for their products. This paper has three objectives. First, it aims to developRead MoreWhat are bank and non-bank financial institution, compare them briefly and explain each of them.1282 Words   |  6 Pagescommerce by providing: safekeeping for cash deposited in the current, savings and fixed deposit accounts a convenient and a safe means of making payments through the current account, or by way of bank drafts, bank transfers and bills of exchange; Finance in the form of loans, overdrafts or discounted bills of exchange; Advice on financial investments or on the credit-worthiness of customers, local or abroad. There are three types of Bank; Central Bank, Commercial Banks, and also Merchant Banks