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Equity Markets (Investment & risk character. (Security depends on…
Equity Markets
Investment & risk character.
Security depends on company profitability
long-term
real
yield
higher expected returns
icw government bonds (long term)
Volatile
income & capital values
Dealing expenses linked to marketability
can be held in
perpetuity
marketability depends on the
size
of the company
Quoted Shares
listed on stock exchange
more
marketable
more
secure
easier to
value
Industry Groupings
Reasons
for use
practical
for analysts to specialise in 1 area
factors
affecting 1 company is
relevant to all
Information comes from
common source
No one analysts can be expert in all sectors
grouping gives structure to decision-making process. Assists
portfolio management and classification
.
~
correlated
share prices
use same
resources
supply same
markets
similar
financial structures