Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

WME > Ch 19 - Equity Securities > Flashcards

Ch 19 - Equity Securities Flashcards

1
Q

what are preferred shares charaterized by?

A

par value and dividend rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

what are cumulative dividends preferred shares?

A

dividends not paid out accrue and must be paid ahead of dividends on common shares.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

what happens to value of preferred shares when interest rates rise?

A

value goes down, just like bonds

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

6 Canadian exchanges

A 
• TMX Group:
Toronto Stock Exchange (TSX)
TSX Venture Exchange, including NEX
TSX Alpha Exchange
• Canadian Securities Exchange (CSE)
• Neo Exchange
• Nasdaq Canada
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

alternative trading systems

A

off-exchange, private, electronic network that discreetly and directly matches buyers and sellers, requiring no intermediaries

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

three types of analysis to estimate return and risk of a stock

A

Industry analysis
Company analysis
Equity valuation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Industry analysis is important for three reasons:

A
  • different industries have different returns over a period of time
  • can help predict future performance.
  • Easier to find good stocks in industry that is expected to do well
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Shorter, more frequently released research reports are called (3 things)

A

comments, notes, or flashes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

research report includes (5 things(

A
  • description company’s operations
  • Overview of the industry i
  • competitive landscape
  • Ginancial models
  • company valuation
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

four major parts of a company’s financial

statements:

A

statement of financial position
statement of comprehensive income
statement of changes in equity
statement of cash flows

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

statement of financial position (balance sheet)

A

lists a company’s assets, equity, and

liabilities at a specified time.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

statement of comprehensive income

A

company’s revenue and expenses over a specified period

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

statement of changes in equity

A

Link between the statement of comprehensive income and the statement of financial position at a specified time.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

statement of cash flows

A

cash inflow and outflow for the company over a specified period.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Relationship between Assets, Equity, and Liabilities (formula)

A

Assets = Equity + Liabilities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

3 activities for statement of cash flow

A

Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities

17
Q

Cash flow from operating activities equals

A

cash received from the sale of goods or services minus cash used to
generate the revenue.

18
Q

Cash flow from investing activities

A

Cash received from the sale of long-term assets minus cash used to buy long-term assets plus any dividends received

19
Q

Cash flow from financing activities

A

cash received from the sale of new shares or the issuance of new debt securities minus cash paid to buy back shares, repay debt securities, or pay dividends.

20
Q

current ratio

A

current assets divided by current liabilities

21
Q

quick ratio

A

current assets minus inventories divided by current liabilities

22
Q

Risk analysis ratios are used to

A

measure the company’s ability to service required debt payments and to assume more debt

23
Q

Operating performance ratios are used to

A

measure how well the company has made use of its resources

24
Q

2 mesure for Operating performance ratios

A

gross margin, net profit margin

25
Q

Value ratios are used to

A

gauge the market’s perception of the value of a company’s shares

26
Q

2 measure for Value ratio

A

P/E Ratio

Dividend Yield

27
Q

3 factors to assess company management

A
  • Experience and expertise in the area of products and services
  • Reliance of the company on one person
  • Integrity of personnel
28
Q

2 most used Absolute valuation models

A

dividend discount model

discounted cash flow model

29
Q

3 sources to determine Benchmark Values

A
  • price multiple of other stocks in the company’s sector / industry
  • The price multiple of the broad equity market
  • The stock’s historical price multiple
30
Q

3 TYPES OF TECHNICAL ANALYSIS

A
  • chart analysis
  • statistical analysis
  • sentiment analysis
31
Q

three purposes of technical analysis

A
  • Improve market timing
  • Forecast price movements
  • Act as a leading indicator
32
Q

Value investors can be grouped into three categories

A
  • Investors who focus on low P/B ratios
  • Investors who focus on low P/E ratios
  • Yield investors, who focus on stocks with above-average dividend yields
33
Q

three non-style approaches

A
  • fundamental approach
  • quantitative approach
  • technical approach

WME (16 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions