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Investing and Financial Markets

(in $000)

There are twelve commercial banks, listed below, in the United States that on December 31, 2021, had over $250 Billion in total assets. If any of these banks failed due to mismanagement, it is highly likely that the regulators would step in to bail them out and not permit them to fail. [Among other affects, this would avoid wiping out the stockholders. I wish I had that kind of backing when I was running my businesses.]
What are some of the advantages this gives these twelve banks over banks that are not quite as large, say between $10 Billion in total assets to $250 Billion? What are some of the advantages this gives them over commercial banks that are considered “community banks” of less than $10 Billion in total assets? For either, should these advantages be allowed? If so, what should be done to encourage formation of super-large banks? If not, what should be done to prevent it?
Note that even among the largest twelve, the largest four are significantly larger. Citibank at #4 had $1.67 Trillion in assets. That is roughly three times the levels of the next largest bank. Those four have 41.8% of all commercial bank assets and 41.0% of all commercial bank deposits.
Institution Name Total Assets
(in $000) Total Deposits
(in $000)
JPMORGAN CHASE BANK, NA 3,306,982,000 2,549,631,000
BANK OF AMERICA, NA 2,519,525,000 2,144,377,000
WELLS FARGO BANK, NA 1,779,504,000 1,524,535,000
CITIBANK, NA 1,669,227,000 1,334,924,000
U.S. BANK NA 564,154,604 465,258,475
PNC BANK, NA 551,902,526 463,881,572
TRUIST BANK 528,514,000 428,138,000
GOLDMAN SACHS BANK USA 434,075,000 321,869,000
TD BANK, NA 423,649,262 370,804,425
CAPITAL ONE, NA 381,299,804 316,873,931
THE BANK OF NEW YORK MELLON 356,225,000 311,812,000
STATE STREET BANK AND TRUST COMPANY 311,063,000 260,805,000
Remember, while citations or quotes are required, the responses should be your own words and thoughts. Further, just because something is on the web, that doesn’t make it automatically correct and without bias. Know the source of anything you find on the web.

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Investing and Financial Markets

In addition, the funds returns have a low correlation to julio’s existing investments.

Read the following article “Advisors prepare for Enhanced Suitability” from Advisors Edge and comment on the following scenario.
Article:
Advisors Prepare for Enhanced Suitability

Advisors prepare for enhanced suitability


Julio Suarez has asked to meet with one of his bank’s investment advisors and is introduced to Peter Schultz, the bank’s mutual fund specialist. Julio tells Peter that he has a long investment time horizon (30+ years) and is comfortable with considerable short-term volatility in the expectation of superior long-term returns relative to less volatile securities such as bonds.
Peter suggests the XYZ Global Equity Fund, which has the following characteristics:
• The fund has been in existence for 22 years. The fund manager has been at the helm for the past 8 years, he was named Fund Manager of the Year three years ago, and he is often quoted in the financial press and sounds very knowledgeable about global markets.
• It is broadly diversified, and has below-average volatility and MER relative to other global equity funds. It also has a 4-star rating from one of the fund rating agencies.
• It has posted above-average returns relative to bond funds over the past 1, 3, 10 and 20 year periods, above-average returns relative to Canadian equity funds over the past 1, 5, 15 and 20 year periods, and above-average returns relative to other global equity funds over the past 3, 5, 10 and 20 year periods.
• The fund has a high 3, 5 and 10 year correlation to the MSCI World Index in Canadian dollars. Their advertising says they have portfolio managers at many locations around the world, so as to stay on top of global conditions. In addition, the funds returns have a low correlation to Julio’s existing investments.
Is Peter’s recommendation suitable given the Enhanced requirements outlined in the article? Why or why not?
Do you feel Peter met his Know Your Product (KYP) obligations? Why or why not?

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Investing and Financial Markets

Al hanbali, a., saleh, h., & ullah, n. (2022).

Each reply must be 275–500 words and
include at least two scholarly citations in current APA format.
DB#1 LONNIE KING
Discussion: Efficient Market Hypothesis
The efficient market hypothesis is an economic concept that has been researched extensively and consists of three different versions: weak, semi-strong, and strong. Efficient market hypothesis suggests “that the stock price is the reflection of the information available in the market” (Kumar et al., 2020). Unfortunately, information leading the market does not mean that it is accurate information. An idea associated with efficient market hypothesis is known as the “random walk” idea. Random walk means “if the flow of information is unimpeded, and information is immediately reflected in stock prices, then tomorrow’s price change will reflect only tomorrow’s news and will be independent of the price changes today” (Malkiel, 2003). Many investors contend that the stock market can be somewhat predictable at times making it easy to grow money. This goes against Fama’s efficient market hypothesis. The article, The Efficient Market Hypothesis, the Financial Analysts Journal, and the Professional Status of Investment Management explains that “investment management involved some measure of skill, but the necessary skill was minimal and easy to acquire. The efficient market hypothesis (EMH) that developed from Fama’s work for the first time challenged that presumption” (Brown, 2020).
Throughout research of the Efficient Market Hypothesis, I have found that there are many differences when it comes to those who refute and those who support the efficient market hypothesis. “According to the efficient market hypothesis, there is no room for excess returns, although later on, different anomalies are found and investors gain excess returns even with the existence of the efficient market hypothesis” (Ying et al., 2019). With the ability to earn a large sum of money in a short period of time, people tend to spend money rapidly. Learning about the hypothesis theory and how it pertains to the stock market does help investors understand how risky it can be. “Whoever loves money never has enough; whoever loves wealth is never satisfied with their income. This too is meaningless” (Ecclesiastes 5:10, NIV). With the use of the market hypothesis, investors can repeatedly earn large sums of money over time. The success of gaining a large cash payout many times will ignite investors to invest again and again. Therefore, bringing life to the scripture found in Ecclesiastes that putting the love of money before God is meaningless. If we are content and wise with our investments as well as careful with our spending, the money we earn can last a much longer time.
In conclusion, using the efficient market hypothesis theory has the potential for an individual to collect a large sum of money by playing the stock market. It can also leave the investor with nothing. Christians investing their money wisely, while keeping an eye on the market, could result in higher earnings that can be used for the glory of God. At the same time Christians should take heed and not get caught up in allowing money to become their god.
References
Al Hanbali, A., Saleh, H., & Ullah, N. (2022). Two‐Threshold control limit policy in condition‐based maintenance. Quality and Reliability Engineering International, 38(4), 2170–2187. https://doi.org/10.1002/qre.3069 (Links to an external site.)
Brown, S. J. (2020). The efficient market hypothesis, the financial analysts journal, and the professional status of Investment Management. Financial Analysts Journal, 76(2), 5–14. https://doi.org/10.1080/0015198x.2020.1734375 (Links to an external site.)
Malkiel, B. G. (2003). The efficient market hypothesis and its critics. Journal of Economic Perspectives, 17(1), 59–82. https://doi.org/10.1257/089533003321164958 (Links to an external site.)
New International Version (NIV) – Version Information – Biblegateway.com, https://www.biblegateway.com/versions/New-International-Version-NIV-Bible/ (Links to an external site.).
Ying, Q., Yousaf, T., Ain, Q. ul, Akhtar, Y., & Rasheed, M. S. (2019). Stock investment and excess returns: A critical review in the light of the efficient market hypothesis. Journal of Risk and Financial Management, 12(2), 97. https://doi.org/10.3390/jrfm12020097 (Links to an external site.)

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Investing and Financial Markets

Remember what we talked about in class.

BUS327 Investments
Walmart 2010
Write Up Suggestions For Case Report Submission
Case studies are in interesting learning tool connecting theory with practical application.
Solutions are often never the obvious. This case is more straight forward. Your role here is to
assist Sabrina Gupta, an investment advisor, in assessing the valuation of Wal-Mart stock.
SHOULD SHE RECOMMEND THE PURCHASE OF THE STOCK?
Your report should be broken down into the following sections:
I. Executive summary
a. What is you assessment of valuation and what is you recommendation?
b. Highlight the key reason(s) for you conclusion.
c. Which valuation approach do you think gives you the most confidence in your
assessment?
II. First focus on the calculation of the discount rate using the CAPM approach.
a. The case gives you data for the variable in the CAPM model.
i. What is the rationale for your conclusion on each of the variables?
1. Risk free rate – why that number and what if it is higher or lower.
How much does that matter.
2. Market risk Premium – again explain why and assess if the
variance matters?
3. Beta – again explain why and assess if the variance matters?
ii. The “Valuation Multiples” reading will be very helpful to you here.
III. Now turn to the Gordon Growth Model – The perpetual dividends approach.
a. Use the GGM excel model to facilitate you calculations and to make comparisons
in the output as you compare and contrast. Find a professional way to share
your data on this work.
i. What Is the anticipated Dividend?
ii. Apply the CAPM calculation for K here.
iii. What will you assume as the perpetual growth rate. What if you solved
for the perpetual growth rate using today’s price? Do you agree with the
implied growth rate?
iv.
IV. Another approach is to estimate dividends for a few years into the future
and then assume that the stock can be sold at the end of that time. The case
provides some assumptions here.
2
i. Assume a future price as guided by the case.
ii. Assume your discount rate is the same as in your CAPM
iii. How valid or not is this approach? Explain.
iv.
V. Lastly, using the 3-stage DDM approach, justify your changes, if any, to what was
provided in the case.
a. Key inputs:
i. Cost of equity
ii. Growth years
iii. Transition years
iv. Initial growth in EPS
v. Payout at maturity
vi. Current year dividend
vii. Current year EPS
A key to understanding valuation is to appreciate how the various models and tools work. Each
are mostly based on the time value of money but are driven by a near term assessment of the
most likely cash flow from the investment (dividends + capital appreciation); an assessment of
sustainable growth; and lastly, a presumed discount rate based on the unique risk profile of
that investment.
Remember what we talked about in class. Valuation measurement is part art and part science.
Value is driven mostly by 2 main factors: growth and the discount rate. These factors are built
on expectations and expectations can change very quickly based on economic (macro) factors
and firm specific factors. Just remember that nothing ever stays the same and nothing lasts
forever.

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Investing and Financial Markets

Then, cite recent scholarly research that provided support for the tenets of the emh and, finally, cite recent scholarly research that provided documentation of an anomaly as it relates to the tenets of the emh.

The Efficient Market Hypothesis (EMH) has been the source of much debate and controversy since it was first popularized by Eugene Fama in 1970. Write a brief summary of the core tenants of the EMH, specifically including the three forms of the EMH (including scholarly support). Then, cite recent scholarly research that provided support for the tenets of the EMH and, finally, cite recent scholarly research that provided documentation of an anomaly as it relates to the tenets of the EMH. Do NOT draw sweeping conclusions about the legitimacy of EMH as a result of your research.
The Business Source Complete database (available through the JFL Online Library) is an excellent place to search for finance-specific, peer-reviewed journal articles to provide the required scholarly support.
Each student will complete one discussion in this class. The opening thread must be 400–750
words in current APA format and include at least three outside scholarly sources (e.g., finance-
related, peer-reviewed journal articles, etc.). Citations from the course textbook should be
avoided and will not count as one of the required sources. The student will integrate the
biblical/Christian worldview into the body of the initial post.

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Investing and Financial Markets

For facebook and twitter the following needs to be done:

For Facebook and Twitter the following needs to be done:
Compare the ratios over time for each
company. Are the companies more or less
liquid or solvent than last year? Compare the
companies to determine which company is
more liquid and solvent.
Conclude with an assessment about each
company’s liquidity and solvency. You should
express an opinion about whether each
company has an appropriate level and types
of debt and whether you would expect the
companies to continue operating with their
existing capital structure.
I have attached full reports for Facebook and twitter

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Investing and Financial Markets

I require an essay that can be used as a video script so casual, and naturally flowing text with a setup, problem and conclusion is necessay.

I require an essay that can be used as a video script so casual, and naturally flowing text with a setup, problem and conclusion is necessay.
Below I have linked some examples of how the video will be presented below.
It will be presented in a very similar manner to the video by Sorelle Amore Finance and should give you a general idea of structure.
Seed Video: https://www.youtube.com/watch?v=bOIVvaC4onI
Additional Seed video: https://www.youtube.com/watch?v=OZupWZak3X8
Book: Sandy Nairn – https://moneyweek.com/investments/stockmarkets/604426/moneyweek-podcast-sandy-nairn-everything-bubble
Additional Source: https://bitcoinmagazine.com/markets/how-big-is-the-everything-bubble
Additional Source: https://www.aier.org/article/the-everything-bubble-and-what-it-means-for-your-money/
The essay should cover how we got to where we are, where we are currently, what many of the greatest minds believe is in store for the future as well as how you can prepare and set yourself up for profiting off of the pop of the everything buble similar to how those profitted during the dotcom bubble.
The essay should have a good mix of data with caual explanation for the viewer to easily comprehend since the viewer will not be reading the essay and may need a little more time to process what is being said. So heavy number talk and statistics can be overlwhelming if used too much.

Categories
Investing and Financial Markets

Content (1 page max)

Executive Summary (1 page max)
Summarize findings.
Answer the question: How have the value for FO and its returns changed from the prior week?
Content (1 page max)
Answer questions posed for that week.
Complete Week 4 – Loan/Equity Sizing Tab (reminder to use the stated holding period provided in Module One) and then
answer the following questions: answer the following questions (EXCEL FILE ATTACHED):
1. Summarize in a CHART format what are the stated returns from a leveraged perspective? Are the returns achieving or
exceeding returns in the Week One Mission Statement? If not, what adjustments are needed and why?
2. This week’s chapters speak about government controls (what types of controls impact the use of FO?), market
forecasting (what did we learn from the data provided on rents?) and contracts (what third party agreements would you
need to craft when owning FO?).