BUS 405 Week 1 DQ1 Blumes Formula Allocation and Selection

 This paperwork of BUS 405 Week 1 Discussion Question 1 Blumes Formula, Allocation, and Selection includes:


 From Chapter 1, answer Concept Question 5: What is Blume

Business - General Business
 Week One

Week 1 – DQ1 - Blume’s Formula, Allocation, and Selection

 From Chapter 1, answer Concept Question 5: What is Blume’s formula? When would you want to use it in practice? Also, from Chapter 2, answer Concept Question 4: What is the difference between asset allocation and security selection?  Remember to complete all parts of the questions and support your answers with examples from the text and other resources.

Week 1 – DQ2 - Money Market Funds

 From Chapter 4, complete Problem 4: The Aqua Liquid Assets Money Market Mutual Fund has a NAV of $1 per share. During the year, the assets held by this fund appreciated by 2.5 percent. If you had invested $50,000 in this fund at the start of the year, how many shares would you own at the end of the year? What will the NAV of this fund be at the end of the year? Why?  Remember to complete all parts of the question, show your work, and report the results of your analysis.

 Assignment


Week 1- Assignment - Annualized Returns – Chapter 3 problem 18

 Complete problem 18 in Chapter 3 (shown below) and submit to the instructor.  Show your work to find the annualized return for each of the listed share prices.  Write a 100 word analysis of the process to calculate these annualized returns.

 Suppose you have $28,000 to invest. You’re considering Miller-Moore Equine Enterprises (MMEE), which is currently selling for $40 per share. You also notice that a call option with a $40 strike price and six months to maturity is available. The premium is $4.00. MMEE pays no dividends. What is your annualized return from these two investments if, in six months, MMEE is selling for $48 per share? What about $36 per share?

 Week Two

 Readings

   Chapter 5: The Stock Market
   Chapter 6: Common Stock Valuation
   Chapter 7: Stock Price Behavior and Market Efficiency
   Chapter 8: Behavioral Finance and the Psychology of Investing

 Discussions

Week 2 – DQ1 - Primary and Secondary Markets

 Complete Concept Question 1 from Chapter 5: If you were to visit your local Chevrolet retailer, there is both a primary and a secondary market in action. Explain. Is the Chevy retailer a dealer or a broker?  Remember to complete all parts of the question and support your answers with examples from the text and other resources.

Week 2 – DQ2 - Contrarian Investing

 Complete Concept Question 9 from Chapter 8: What does it mean to be a contrarian investor? How would a contrarian investor use technical analysis? Post your answers to the discussion board.  Remember to complete all parts of the question and support your answers with examples from the text and other resources.

 Assignment

Week 2 – Assignment - Abbott Laboratories Problem

 After reading the Value Line figures and information on Abbott Laboratories in the Questions and Problems section of Chapter 6 (just before Problem 27), complete Problems 27, 28, 29, 30, and 31 and submit to your instructor.  Show your calculations and in your response to problem 31 write a 100 to 200 word defense of your position as to the value of Abbott Laboratories stock at its current price of $50 per share.

 27. What is the sustainable growth rate and required return

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