Book : Understanding Wall Street, Fifth Edition...

-Titulo Original : Understanding Wall Street, Fifth Edition (understanding Wall Street (paperback))

-Fabricante :

McGraw Hill

-Descripcion Original:

From the Publisher Jeffrey B. Little has been a registered investment analyst, serving as senior analyst at a major Wall Street firm and as a vice president of the prominent investment counsel firm, T. Rowe Price Associates. Lucien Rhodes is a respected financial journalist with several years experience as a senior analyst and portfolio manager in both commercial and investment banking. A fully revised edition of the INVESTING CLASSICFor over 30 years this comprehensive, easy-to-read guide has served well as the definitive reference for successful investing. Now in its fifth edition and completely updated, Understanding Wall Street helps investors prosper in today’s challenging economy whether you’re just beginning or among the millions soon to retire.Understanding Wall Street, Fifth Edition, has new sections and information on the issues most important to today’s investors, including:How to use the Internet as an investing tool The shift to exchange traded funds (ETFs) The link between Wall Street and Main Street The Risks and rewards of the global economy Praise for previous editions of Understanding Wall Street:“Recommended. An excellent introduction to stock market intricacies.” Booklist“A lucid guide to those downtown mysteries.” Newsday“Remarkable . . . it remains as useful as ever . . . Experience may be the best teacher, but this manual runs a close second.” American Library Book Review About the Author Jeffrey B. Little has been a registered investment analyst, serving as senior analyst at a major Wall Street firm and as a vice president of the prominent investment counsel firm, T. Rowe Price Associates. Lucien Rhodes is a respected financial journalist with several years experience as a senior analyst and portfolio manager in both commercial and investment banking. Excerpt. © Reprinted by permission. All rights reserved. UNDERSTANDING WALL STREETBy Jeffrey B. Little Lucien RhodesThe McGraw-Hill Companies, Inc.Copyright © 2010 Jeffrey B. LittleAll right reserved.ISBN: 978-0-07-163322-2ContentsChapter OneWhat Is a Share of Stock? Introduction Every business day, billions of shares of stock are bought and sold. How did these shares originate, and how are their prices determined? For shares to be traded from one person to another, a company must be created. How does it begin? Where does the money come from? In this chapter, The NewBrite Lighting Company is born and its officers confront the problems that all successful corporations must solve. Directors are elected, shares are issued, profits are reinvested in the business, and dividends are declared. In the process, the reader will see capitalism at work and will gain an appreciation for a great system that has produced the most advanced economy in the world. The NewBrite Lighting Company Johnston W. Jack Campbell, a young inventor, has just created a brighter, more efficient LED lighting fixture with a superior design. Encouraged by his family and friends, he decides to turn his hobby of improving lights into a full-time business rather than sell his patents to a large lighting company. Although Jack has savings that could be put into the venture, the amount is far short of the total capital necessary. He estimates that the total cost for the factory, machinery, and initial money required for product inventory to be approximately $2 million. These assets (the factory, machinery, inventory, and remaining capital) would be used to produce the units and maintain the new business. The more fixtures Jack can produce using these assets, the more profitable the business would be. Jack has calculated that if he could make and sell at least 100,000 units annually, it would cost about $20 to manufacture each unit. In addition, he estimates the sales and marketing expenses for each fixture to be roughly $10. Since each new lighting fixture would be sold to his customers at the competitive price of $35, his profit