Business Finance w1

• Finance

  Management of money and activities such as investing, borrowing, lending, budgeting, saving, forecasting
• Investing

  Investing personal money in stocks and bonds
• Borrowing

  borrowing money from institutional investors by issuing bonds on behalf of a public company

   
• Lending

  Lending money to people by providing them a mortgage

   
• Budgeting

  Using excel spreadsheets to build a budget and financial model for a corporation

   
• Saving

  Saving personal money in a high-interest savings account

   
• Forecasting

  Government spending and revenue collection

   
• Investment

  Work with financial assets (stocks and bonds)

   
• Investment

  Value of financial assets, risk vs return, and asset allocation

   
• Financial Institutions

   

  1.Companies that specialize in financial matters

  2.Banks, credit union, savings, and loans

  3.Insurance companies

  4. Brokerage firms
• International Finance

   

  Need to be familiar with exchange rates

  Political Risk

  Customs of other countries

  Speaking of foreign language

   
• Capital Budgeting decisions

  how to spend the money
• Capital Budgeting decisions

  What long term investment should the firm undertake
• Capital Structure decision

  how to get the money
• Capital Structure decision

  How should the form fund these investments

   
• Working Capital Management decision

  how to manage cash (liquid) money
• Working Capital Management decision

  How can the firm best manage its cash flows as they arise in its day-to-day operations

   
• Shareholder

  A person, company, or institution that owns at least one share of a company’s stock

   
• Shareholder

  wealth is measured based on the current market price on the corporation's stocks

   
• Corporations

  May either be privately owned or publicly owned

   
• Privately owned corporation

  Often owned by family members whose stocks may not be offered to outsiders unless consent by family members is secured

   
• Publicly owned corporation

  Owned by unrelated investors and are traded in organized exchanges like the Philippine Stock Exchange

   
• FACTORS THAT INFLUENCE MARKET PRICE CONTROLLABLE BY MANAGEMENT

  Profitability
• FACTORS THAT INFLUENCE MARKET PRICE CONTROLLABLE BY MANAGEMENT

  Dividends
• FACTORS THAT INFLUENCE MARKET PRICE CONTROLLABLE BY MANAGEMENT

  Having good liquidity and reasonable leverage position
• FACTORS THAT INFLUENCE MARKET PRICE CONTROLLABLE BY MANAGEMENT

  Competent management which affects the company's operating efficiency
• FACTORS THAT INFLUENCE MARKET PRICE CONTROLLABLE BY MANAGEMENT

  Coming up with corporate plans that improve the business prospects of the company
• FACTORS THAT INFLUENCE MARKET PRICE UNCONTROLLABLE BY MANAGEMENT

  Political stability
• FACTORS THAT INFLUENCE MARKET PRICE UNCONTROLLABLE BY MANAGEMENT

  Macroeconomic conditions
• FACTORS THAT INFLUENCE MARKET PRICE UNCONTROLLABLE BY MANAGEMENT

  General market sentiment
• FACTORS THAT INFLUENCE MARKET PRICE UNCONTROLLABLE BY MANAGEMENT

  Prospects of the industry where the company operates
• FACTORS THAT INFLUENCE MARKET PRICE UNCONTROLLABLE BY MANAGEMENT

  Flow of foreign funds invested in the Philippine stock market
• Competent managers may have any of the following attributes:

   

  1. visionary         
  2. decisive          
  3. people-oriented
  4. inspiring
  5. innovative
  6. respected
  7. experienced/seasoned manager
• External Factors

  These factors influence the general reaction of investors in making an investment decision.

   
• External Factors

  Its effect is not only to a specific company but on all companies or a group of companies under similar circumstances.

   
• External Factors

  Such factors are a result of the environment a company operates in rather than the decisions of the company's management.

   
• Dividends

  Holders of shares receive _ from a corporation as returns on their investments in form of cash or other properties.

   
• Dividends

  Companies which have better _ policies are generally more attractive than companies who do not pay out _.
• Good liquidity and reasonable leverage position

  Liquidity and leverage refers to the company's management of the type and amount of assets and liabilities that it will hold in the course of its operations.

   
• Liquidity and leverage refers to the company's management of the type and amount of assets and liabilities that it will hold in the course of its operations.