An Introduction to Investments

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This textbook uses a substantial number of examples and illustrations employing data that are generally available to the investing public. Many textbooks on investments are written for students with considerable background in accounting, finance, and economics. Not every student who takes a course in investments has such a background. These students cannot cope with (or be expected to cope with) the material in advanced textbooks on investments. An Introduction to Investments is directed at these students and covers investments from descriptive material to the theory of portfolio construction and efficient markets. This textbook has a variety of features designed to assist the student in the learning process. Chapters include questions and, where appropriate, problems. The questions and problems arestraightforward and designed primarily to review the material. Answers to selected problems are provided in Appendix B. Key Feature Coverage of investment companies is now broken into two separate chapters for a clearer presentation. One chapter (Ch. 7) focuses on mutual funds, while the other (Ch. 8) emphasizes other types of investment companies to clarify and ensure understanding Expanded coverage of stock valuation ratios now includes adjusted PEG, return on equity to price to book, and profit margin to price to sales in order to provide a more thorough introduction to these key investment topics Additional focus on the globalization of financial markets and reduced potential for diversification in this edition prepares students for success in today's international investment market Proven focus and clear presentation of CFP testing-related topics throughout this edition prepares your students for success on today's CFP exam Table of Contents Part I: The Investment Process and Financial Concepts 1. Investments: An Introduction 2. The Creation of Financial Assets 3. Security Markets 4. The Time Value of Money 5. The Tax Environment 6. Risk and Portfolio Management Part II: Investment Companies 7. Investment Companies:Mutual Funds 8. Closed-end Investment Companies Part III: Investing in Common Stock 9. The Valuation of Common Stock 10. Investment Returns and Aggregate Measures of Stock Markets 11. Dividends: Past, Present, and Future 12. The Macroeconomic Environment for Investment Decisions 13. Analysis of Financial Statements 14. Behavioral Finance and Technical Analysis Part IV: Investing in Fixed-Income Securities 15. The Bond Market 16. The Valuation of Fixed-Income Securities 17. Government Securities 18. Convertible Bonds and Convertible Preferred Stock Part V: Derivatives 19. An Introduction to Options 20. Option Valuation and Strategies 21. Commodity and Financial Futures Part VI: Alternative Investments 22. Investing in Foreign Securities 23. Investing in Nonfinancial Assets: Collectibles, Natural Resources, and Real Estate Appendix A: Mathematical Tables Appendix B: Answers to Selected Problems Cases