Essays on Financial markets

CHAPTER ONE 1 INTRODUCTION The term dividend refers to that part of profits of a company which is distributed by the company among its shareholders. It is the reward of the shareholders for investments made by them in the shares of the company. The investors are interested in earning the maximum return on their investments…

Interest rate parity is a no-arbitrage condition representing an equilibrium state under which investors will be indifferent to interest rates available on bank deposits in two countries. [1] The fact that this condition does not always hold allows for potential opportunities to earn riskless profits from covered interest arbitrage. Two assumptions central to interest rate parity are capital mobility and perfect substitutability of domestic and foreign assets. Given foreign exchange market equilibrium,…

On January 31st, 2007 India’s Tata Steel acquired Corus, the erstwhile British Steel Major at a price of 608 pence per Corus share totaling $12. 1 billion/ Rs 54,000 crore/ ? 6. 1 bn, which was five pence per share higher than the offer of Brazil’s CSN (Companhia Siderugica Nacional). The deal is the largest…

In order to find the endeavor value and recovery rates for each category of creditors implied by the April 2009 attempted exchange offer. we foremost had to find the precedence degrees of the capital construction. We used Exhibit 7 in the Case papers to find the precedence degrees of each category. The top precedence category…

Case Summary In early 2003, Boeing announced plans to design and sell an airliner named the 7E7. Boeing aimed for the 7E7 to be more fuel-efficient, carry between 200 and 250 passengers, able to accomplish both domestic and international flights, as well as be 10% cheaper to operate than Airbus’s A330-200 aircraft. All of these…

The greatest advantage of municipal bonds can be summed up in two words: tax free. The interest rates on municipal bonds may seem low compared to similar long-term securities like Treasury bills and CDs, but tax advantages may level the playing field. Let’s look at some examples. If you’re in the 25 percent bracket for…

How is the policy portfolio of Harvard determined? What are the three major plus categories in the portfolio as of May 1999? Internally. by the HMC. The Board of the corp determined the Pol Port. but the mgmt. was permitted to do short-term determinations within certain restraints. HMC. considered 3 things when looking at plus…

Bank OneIn 1929, Commercial National and City National Bank of Commerce of Columbus, Ohio, merged to form City National Bank and Trust. City National offered the first Visa credit card outside of California in 1966; it also created the first drive-up bank, and was one of the first banks to use ATMs. A holding company…

Student: ____________________________ 1.  You purchase one September 50 put contract for a put premium of $2. What is the maximum profit that you could gain from this strategy? A. $4,800 B. $200 C. $5,000 D. $5,200 E. None of these is correct 2. The premium on one IBM February 90 call contract is A. $4….

1. Statement of the Problem In the instance Roche Holding AG: Funding the Acquisition, Roche and Genentech are interested in an acquisition. Roche is geting about having all outstanding portions of Genentech. Roche Holding AG is a Switzerland-based pharmaceuticals and nosologies company. It discovers, develops and provides diagnostic and curative merchandises and services from early…