MF0010 & SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT

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ASSIGNMENT

DRIVE WINTER	2013
PROGRAM	MBADS – (SEM 3/SEM 5) / MBAN2 / MBAFLEX – (SEM 3) / PGDFMN – (SEM 1)
SUBJECT CODE & NAME	MF0010 & SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT
SEMESTER	3
BK ID	B 1754
CREDITS	4
MARKS	60

Note: Answer all questions. Kindly note that answers for 10 marks questions should be approximately of 400 words. Each question is followed by evaluation scheme.

Q1.Explain the meaning of investment and security. Describe the investment process

Answer : Loosely defined, a security in the world of finance is an instrument representing financial value. Securities can be categorized as debt, equity or derivative securities and can be represented through a certificate or non-certificated book entry form. These certificates entitle the holder to rights under the security and can include shares of stock, mutual funds or bonds.

Investing in Securities

Debt securities, or bonds, refer to a type of loan in

Q2.Write about the secondary markets? Explain the role of financial intermediaries.

Answer :  The secondary market, also called aftermarket, is the financial market in which previously issued financial instruments such as stock, bonds, options, and futures are bought and sold.[1] Another frequent usage of "secondary market" is to refer to loans which are sold by a mortgage bank to investors such as Fannie Mae and Freddie Mac.

Q3.Explain the meaning of risk. Describe what are the factors that affect risk

Answer : Risk is the potential that a chosen action or activity (including the choice of inaction) will lead to a loss (an undesirable outcome). The notion implies that a choice having an influence on the outcome sometimes exists (or existed). Potential losses themselves may also be called "risks". Any human endeavour carries some risk, but some are much more risky than others.

Insurance companies are in the “risk transfer”

Q4.Briefly explain the variables that are analyzed in economy analysis.

Answer : Economic analysis

Real activity and financial conditions

The economic analysis assesses the short to medium-term determinants of price developments. The focus is on real activity and financial conditions in the economy. The economic analysis takes account of the fact that price developments over those horizons are influenced largely by the interplay of supply and demand in the goods, services and factor markets.

To do so, the ECB regularly reviews, inter alia,

Q5.Explain about technical indicators and How are they used?

Answer : The central idea behind technical analysis is that past price actions can help predict future price behaviour. This is why chart patterns, candlestick formations, and other technical indicators are used to determine whether an uptrend or downtrend is due. And since most traders play by these technical ideas, their price behaviour forecasts tend to be self-fulfilling.

This article is designed to introduce the concept of technical indicators and explain how to use them in your analysis. We will shed light on the

6 Explain the assumptions of Capital Asset Pricing Model (CAPM). Give a short note on Separation Theorem, Capital Market Line(CML) and Security Market Line (SML)

Answer : Meaning and definition of Capital Asset Pricing Model

The Capital Asset Pricing Model (CAPM) refers to a model that delineates the relationship between risk and expected return and what is used in the pricing of risky securities. The concept is used for pricing an individual portfolio or security. The basic idea underlying the concept is that investors are required to be compensated in two ways –

·         Time value of money

Dear students get fully solved assignments

Send your semester & Specialization name to our mail id :

  help.mbaassignments@gmail.com

or

call us at : 08263069601