FIN2030 W5 A2 part1

Olter, Inc. is starting its risk management program for the company and has asked for your help in determining critical risk measurements for the firm. The company has identified several factors in the market that they believe are critical for your tasks: The risk-free rate is 6% The required return on the average stock is 13% Olter's average return is 13% Required: What is Olter's beta coefficient? How does the beta coefficient influence the firm's stock value? What is the required rate of return for Olter? In terms of risk, how does Olter compare to the average firm in the market? If Olter's beta increased to 1.6, what would you expect to happen to the required rate of return and what does this mean for the firm?

FIN2030 Portfolio Analysis Part A - Research Online Trading Sites and DRIPs

Portfolio Analysis Part A: Research Online Trading Sites and DRIPs For this part of the assignment, you will evaluate the choices in purchasing stock via online brokerage accounts (where you can buy and sell stock via the Internet) and the use of dividend reinvestment plans (known as DIPs and DRIPs) or mutual funds or index funds. For online brokers, you will be looking for the requirements to open the accounts: costs, minimum balances, and other features. Because most DIPs or DRIPs are available from publicly traded companies, you can search their Web sites or a search engine on these plans and their requirements. Perhaps the most famous and useful Web site for these programs is http://www.directinvesting.com/. You are to compare and contrast online brokerage to DIPs and DRIPs. Required: Research online trading sites and DRIPS as outlined below, and summarize your findings. Make sure to include a summary table of the relevant information. 1.Search three online trading sites, and determine the requirements for trading, including the price per trade. Compare and contrast the online trading companies. (2–3 pages) 2.Search the Web for three companies (look for investor information) that offer DIPs or DRIPs. (2–3 pages) 3.Compare and contrast the requirements, including minimum investments, nature of the return, costs, and other features. (1–2 pages)

FIN2030

1. Stock. What is the value of a stock with a a. $2.50 dividend just paid and an 8% required return with 0% growth? b. $3 dividend just paid and a 8% required return with 2% growth? c. $7 dividend to be paid and a 10% required return with 2% growth? 2. Stock. What is the required rate of return on a stock with a a. $2.50 expected dividend and a $19 price with 6% growth? b. $2.75 expected dividend and a $20 price with 8% growth? c. $2.50 expected dividend and a $19 price with 9% growth? 3. Stock. What is the growth rate of the stock with a a. $3.00 expected dividend and a $20.60 price with 15% required return? b. $2.40 expected dividend and a $25.35 price with 10% required return? c. $2 expected dividend and a $8.30 price with 11% required return? Bonds 1. Bond. What is the value of a $1,000 par value bond with annual payments of an a. 10% coupon with a maturity of 10 years and a 15% required return? b. 8% coupon with a maturity of 10 years and a 8% required return? c. 11% semiannual coupon with a maturity of 20 years and a 11% required return? d. 8% semiannual coupon with a maturity of 20 years and a 9% required return? 2. Bond. What is the yield to maturity of a $1000 par value bond with an a. 10% annual coupon and 10 years to maturity and a $1,000 price? b. 9.5% annual coupon and 20 years to maturity and a $788 price? c. 5.0% annual coupon and 8 years to maturity and a $800 price?

FIN2030 Portfolio Analysis Part B -Research Market Data on Bonds

Part B: Research Market Data on Bonds Research the current (within the last two months) market data on bonds from AT&T, Dell, and IBM. Assume each bond has a par value of $1000, unless otherwise indicated. Cite your sources. AT&T Dell IBM Coupon Maturity Frequency Rating Required: 1.Complete the table above. 2.Calculate the value of the bond if your required return is 5% on AT&T, 6.5% on Dell, and 8% on IBM. 3.Determine the yield to maturity (YTM) on the bonds given the current price. Based on each bond's ratings and your determination of its yield to maturity, explain how you rank each bond for risk and return.