What is meant by managing risk, and how is the beta concept used in this effort?
Answer to relevant QuestionsExplain dollar cost averaging and why it may be helpful for certain investors. What is a dividend reinvestment plan, and what advantage does it offer? Also briefly explain several other routine investment techniques. Explain your rights and return potential as a common stockholder, bondholder, or preferred stockholder. Discuss whether one of these is better than the other two. Calculate the yield to maturity for the following bonds (each has a par value and redemption value of $1,000): a. 8 percent coupon rate, 10-year maturity, $1,200 price b. 12 percent coupon rate, 20-year maturity, $800 price Explain a convertible bond. Would you be inclined to buy such a bond if it were issued by a growth company? Discuss. What is a mutual fund? Define NAV, and explain how it is calculated.
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