© 2000 John Petroff
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© 2000 John Petroff |
Assignments, Cases & Exercises
Research assignments:
R-1A1 Visit AIMR web site at http://www.aimr.org/. Identify and record the requirements for becoming a Chartered Financial Analyst. Catalogue the resources available in terms of content, size, access and price.
R-1D1a.1 Obtain an annual report from a corporation or your choice (e.g. a major employer in your city or region), or visit a corporate web site that presents its annual report in its entirety. Recognize each of the major financial statements and verbal explanations. Optional: find an annual report for the same company issued at least five years earlier and compare it with the recent one.
R-1D1a.2 For the same company as in the previous question, obtain the 10-K filing of the company from SEC web site at http://www.sec.gov/cgi-bin/srch-edgar or http://www.edgar-online.com/ . Identify the various types of information present in form 10-K not present in the annual report.
R-1D1a.3 For the same company as in R-1D1a.1 obtain from the company web site or from the SEC quarterly reports (form 10-Q) for the four quarter of the year contained in the annual report. Recognize the information present in the quarterly reports, and its limitations. Compare the data contained in the four quarters to the annual data. Obtain the most recent quarterly report and identify its informational content in light of corporate strategy disclosed in the earlier annual report.
R-1D1b.1 Read the major provisions of the Securities Act of 1933 and the Securities and Exchange Act of 1934. Research and summarize the literature on the impact of these statutes in reduction of fraud, improved corporate disclosure and greater investment community confidence. Recognize the role of SEC new recent disclosure requirements.
R-1D1b.2 Obtain and study state securities laws of the state of your choice (e.g. your own). Determine how these statutes complement Federal statutes. Research the literature on the usefulness of these statutes.
R-1D1c.1 Visit web sites of S&P, Moody's, Value Line and others that report corporate securities information. Record the type of data present free of charge and for a fee. Compare the usefulness of the different sites according to the type of investor (i.e. shareholder, bondholder, day trader, etc.)
R-1D2.1 Visit your library (at work, in school or in a major city) and verify that industry information is present there from trade associations, government and specialized services. Compare these sources for an industry of your choice (e.g. the major industry in your city or region), in terms of the nature and timeliness of the information. Note which source can give you the most complete list of dominant firms in the industry. Use search engines to see if comparable (or better) information is available on-line.
R-1D3.1 Visit your library and locate all the major sources of information on the economy from the Federal government, the Federal Reserve Bank, commercial banks and other organizations. Rank the sources by order of their usefulness for investment decisions. Visit government web sites listed in the text and search engines to see what of the most useful economic data present in libraries has been put on-line. Send an e-mail to the author of this text if new additions are observed that are not already listed.
R-1D4.1 Research which stocks are included in Dow Jones Industrial Average. Comment on the selection comparing it with prior years. Verify your understanding of the calculation by reconciling the latest adjustment to the divisor resulting from recent stock split. Quote some writings that interpret movements in different Dow Jones averages.
R-1D4.2 Copy or print out charts of major stock market indices (e.g. Dow Jones, S&P, NYSE, NASDAQ, Value line, Wilshire and Russell) over a period of several years. Compare the patterns. See if observable difference can possibly be explained by the way the different indices are constructed.
R-1D4.3 Read recent Factbooks of major exchanges (i.e. NYSE especially). Report major trends and conclusions. Suggest potential changes in legislation, exchange operations or investor's attitudes (if any) that can be predicted as a result of these conclusions.
R-1D4.5 Visit web sites of some of European and Asian exchanges. Compare the information available and usefulness of the sites to those in the United States. Also visit emerging technology web sites and determine who can trade on them, what disclosures are available and what volume and types of trades are taking place.
R-1D5.1 Visit your library to identify the business publications and the publication indices available. Compare the ease of access, cost and usefulness of articles found through such indices as Business Periodical Index, NYT Index and WSJ Index, with that obtained on-line from search engines and specialized investor web sites (e.g. those of brokers).
R-1D7.1 Research which type of investment professional journal is most read by different types of investors and lenders.
R-1D8.1 Determine how the information available from international organizations (e.g. UN, World Bank, OECD, IMF, IFC, and others) can be useful to investors.
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