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Transcript
INVESTMENT ANALYSIS
&
PORTFOLIO MANAGEMENT
Lecture # 1
Dr. Shahid A. Zia
The Course
•
•
•
•
INVESTMENT
ANALYSIS
PORTFOLIO
MANAGEMENT
2
Text book
• PRACTICAL INVESTMENT MANAGEMENT, 3rd
Edition, (Southwestern/Thomson)
• Robert A. Strong
• ISBN 0-324-17164-1
• INVESTMENT ANALYSIS and MANAGEMENT,
9th EDITION, (by Charles P. Jones)
3
Investment Alternatives
Assets are things that people own.
Assets
Financial Assets
e.g. bond, stock
Real Assets
e.g. land
4
Investment Alternatives
There are three broad categories of securities.
Securities
Equity
Securities
e.g. common
stock
Fixed Income
Securities
e.g. bonds,
preferred stock
Derivative
Assets
e.g. futures,
options
5
Three Reasons for Investing
Why invest ???
People invest to …
• supplement their income
– Dividends and Interest.
• earn capital gains
– Appreciation refers to an increase in the value
of an investment.
• experience the excitement of the
investment process.
6
Investing
To consume, to save, or to invest
a rupee that is earned ?
Both saving and investing amount to
consumption shifting through time.
However, saving involves little, if any,
risk, while investing is a risky
endeavor.
7
Fundamental Analysis
•
•
•
•
•
•
Fundamental Analysis include the evaluation of
the;
Balance Sheet
Annual Report
Profit & Loss Figures
Profitability Ratios
Liquidity Ratios
Operational Ratios
8
Technical Analysis
Focus on the movement of the share prices
going up or going down.
Scenario Analysis
9
Investments
Investment means to invest something in
some where.
10
Uses of Investments
Three uses of investments;
1. Consumption
2. Savings
3. Investing
11
Investing
You consume less than you save and then
from saving you can always think about
investment.
12
Savings
It is very important to see that how you
save the money.
• You save money in your home at secure
place.
• Committees.
13
Channels of Savings
• Banking
• Non-financial institutions
• National saving schemes
14
Portfolio Management
How to manage different sectoral things.
“Don’t Keep all your eggs in one basket”
15
Investment Analysis and Portfolio
Management
Mutual fund are also used in the portfolio.
• Collection of eggs.
• Collection of different shares, cash and
foreign exchange.
16
Bonds
•
•
•
•
Term Finance Certificates
Bearer bonds
Fixed Income bonds
Euro bonds
17