Financial Investment Introduction The investment style of an individual varies from another depending on various opportunities and investment constraints. Individuals generally invest a certain portion of the surplus left after all necessary expenditures are carried out…
Ratio analysis and share price analyses are 2 most important and commonly used tools to analyze the financial position of a particular stock. A proper fundamental and technical analysis generally provides a basic idea regarding these aspects and helps investors make informed investment decisions. Generally the intrinsic value of the stock is determined from the financial facts given the annual report of the company using free-cash flows and it is compared to the current market price of the stock. When the stock is found to be undervalued then it provides an opportunity for the investor to buy the stocks at lower current price and then sell it in future when stock prices approaches target price. This strategy will help the investor make profits by buying stocks at lower price and then selling it when stock prices appreciates and ceteris paribus. Options for Investment Decision While there are many options available to an investor for investment, it is important to note that not all investment destinations are equally safe for investment when risk of investment is considered. The safest investment destination is government securities because there are very limited chances that the government will default. Another most commonly preferred investment avenue is common stocks of publicly traded companies. Companies whose stocks are listed in stock exchanges (like NASDAQ, NYSE, etc.) may be traded in secondary markets. But whenever the investor considers investment in equity oriented securities and stocks the risk of investment significantly increases. This is because when the investor buys equity shares of any company the investor actually subscribes to paid-up equity capital of the owners of the company. This automatically makes the investor the new stocks holder and assumes that the investor will bear the risk associated with business. Purchasing equity shares provides the investor the opportunity to earn dividends and residual profits proportionate to respective subscription or investment. Equity stocks are risky because the shareholders are entitled to earn from investment only after all liabilities of the business entity has been paid-off. This means that in case the business has no profits left for distribution to shareholders after honoring business liability then no dividends will be paid to shareholders. Thus, investment in company stocks is both risky and rewarding in the sense that higher the risk the higher would be the expected return. It is advised that before making any investment decisions for investment in particular stocks the financial managers must gather all necessary information related to business regarding financial position, outstanding financial liabilities and the ability of the business to honor such liabilities. Company Overview The company chosen for financial analysis is Apple Inc. (Ticker Symbol AAPL) which is a Fortune 500 company whose shares are publicly traded. Apple Inc. is a leading hardware and software company which has headquarters in Cupertino, California, U.S. The company has over 400 global retail stores spread in over 14 countries and it is listed in NASDAQ as a publicly traded company. Apple also forms a component of S&P 500 composite index and NASDAQ-100 component. The financials of the company is very strong and for the year ending 2012, the company reported a net profit of over UD$ 41 ...
Cite this document
(“Financial Investment Research Paper Example | Topics and Well Written Essays - 3000 words”, n.d.)
Retrieved from https://studentshare.net/finance-accounting/112603-financial-investment
(Financial Investment Research Paper Example | Topics and Well Written Essays - 3000 Words)
“Financial Investment Research Paper Example | Topics and Well Written Essays - 3000 Words”, n.d. https://studentshare.net/finance-accounting/112603-financial-investment.
The administrations of various countries have taken and continue to adopt unseen, significant actions, but we need to watch and wait for the results. Moreover, real estate investment is an essential contributor to household welfare, urban development, and growth of an economy.
Interest is the idea that one dollar invested today at the present time is worth more than the same amount in the future due to its potential earning ability (Investopedia). The financial decision making process whether it is from the perspective of the investor or a firm, is primarily concerned with determining how monetary value of capital will be affected by the expected returns (payoff) associated with the different investment alternatives.
The growth in private credit stagnated while high-risk aversion by the financial institutions coupled by decline in investor confidence stifled credit growth in the economy (Casa, 2009). The real growth in the non-oil economic activities declined by about 5 percent in 2009 and the oil sector saw a significant decline in investments due to slowdown in global oil demand and significant decline in the global oil prices (Distr, 2009).
The global financial crisis rapidly resulted in the failure of world stock markets and subsequently the collapse large financial institutions. Countries with economic insecurity were largely affected since they could not effectively initiate various monetary tools.
The general perception is that these oil reserves cushion the Arab countries during the global crisis. These perceptions are obscure since the Gulf region has extremely rich and extremely poor countries. Different countries in the Gulf region have different economic, demographic, and political features.
According to Sharpe and Alexander, 1990, Investment Portfolio statements provide the foundation for all future investment decisions the investor makes. There are four basic purposes for the Investment Portfolio statement;
Determining communication procedures - this is the feedback system.
The long term objectives of an investor differ from person to person. Objective may constitute arrangement of income after retirement, purchasing of a house property, or any other goal. These days investors seek some sort of financial independence. That implies that investors require certain amount of income from investment portfolio in order to maintain a particular standard or status of life without caring about the future.
However, as is all too well known, Lehman Brothers declared bankruptcy and imploded as a direct result of the fact that it engaged in risky financial decision-making that ultimately contributed to the failure of the firm. As a function
Investing money is the best way for a person or business to generate a return that can allow an individual to accumulate wealth. On this stock simulation game I have $100,000 to invest. My strategy is to find a stock with the capability of of providing me with
6 Pages(1500 words)Research Paper
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Research Paper on topic Financial Investment for FREE!