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Unit-2 Stock and Portfolio Analysis - Coggle Diagram
Unit-2
Stock and Portfolio Analysis
Measures of Risk and Performance
Risk Definition
Market Price Risks
Currency Risk
Inflation Risk
Interest -rate risk
Equity Price risk
Commodity risks
other Risks
Country Risk
Liquidity risk
Specific Investor Risk
Capital maintanance risk
Information risk
Settlement and management risk
Advocacy risk
Conditions risk
Risk Management
Sharp Ratio
Measures excess return per unit of absolute risk
Reward-to-variability ratio
Advantages: intuitive, Simple, Comparable
Drawbacks: lack of comparison with overall risk, no insights into composition
Treynors Ratio
Measures excess return per unit of undiversifiable risk
Reward-to-Volatility ratio
Advantages: Comparable, insights into portfolio structure with sharpe ratio.
Drawbacks: disregards unsystematic risk
Measure of Return
Basic Return Equation
Time-weighted-return
Money-weighted return (IRR)
Stock Analysis
Tasks of Stock Analysis
Forecasting Methods
Objective Methods
Fundamental Analysis
Technical Analysis
Innovative methods
Subjective Methods
Survey of experts
Intuitive methods
Fundamental Analysis
Intrinsic Value (Fair Value)
Key Ratios
Price/Earnings ratio (P/E)
Prie/Cash Flow ratio (P/CF)
Technical Analysis
Focus: Prince and trading volume trends
Hypothesis for Future Developments
ClassicChart Analysis
Mathematical Forecasting Systems
Breakdown: Presentation, Formation, Market Analysis
Innovative Methods of Analysis
Chaos Theory
Neural networks
Study Goals
which market risks must be taken into account by an investor.
what individual measures of risk reveal.
how individual measures of risk and return are calculated.
what the current common stock analysis methods are.
what individual key ratios in a stock analysis indicate.