Discussion Question 1232

Question Description

each discussion word 200words is enoughy just answer the question in few sentence.

  1. What are the 3 forms of market efficiency? Explain each in at least 3 sentence for each. Is the stock market truly efficient. Explain your answer. If the market is truly efficient, how does this effect investor strategy of attempting to outperform the market?
  2. Explain how the existence of financial assets is essential for an economy to grow through the expansion of its real assets. When the financial crisis of 2008 occurred, how did the uncertain of financial assets affect firms’ ability to raise funds in the financial markets?
  3. Given the current market conditions and expectations of future interest rate movements, what would be your advice to an investor holding a large portfolio of bonds who anticipates liquidating their bonds in three (3) years? Why would you give them this advice?
  4. At what point is the US economy on the business cycle as of today? (peak, trough, in-between) Given your answer to this question, what type companies would you recommend your clients to invest in if you are their wealth manager? (cyclical, defensive, etc) Give 5 specific companies you would recommend.
  5. What are credit default swaps? Under what circumstances can they be highly profitable to the seller? Why were they such a disastrous failure during the Financial Crisis of 2008?
  6. What is the difference between a front-end load and a back-end load fund? Under what circumstance would each be most advantageous to the investor?
  7. What is the difference between fundamental and technical analysis for equities? Which would be the most effective for judging a cyclical stock and which would be most useful for a defensive stock? Explain why.
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