Investors are irrational or naive
Explain how companies with substandard financial history can draw the attention of investors. Are investors irrational or naive?
Expert
There may be some companies in the world whose performance in the past may not be good due to poor management, poor market condition, increased competition, introduction of substitutes in the market. All these can lead to decrease in revenue and ultimately profits. Now there may be companies whose financial performance has decreased not due to some mismanagement but due to some hard hitting abnormal conditions such as poor market etc. Investors look out for distressed investments so that they can purchase the stake at low valuations. Investors know which company has good prospects and they can exit such investments at a high valuation at a later stage. They are very smart individuals.Investors are neither irrational nor naive. They took any investment decisions based on many factors such as future growth of the sector, the competition in the market, how to maximize returns etc. They take decisions after they know that they will get their required Rate of return from the investment. Further, investors are also not naive. It is their hard earned money. They make investments only after they are reasonably sure of a good and profitable exit. They apply various techniques of valuation to evaluate a company before investing in it. They do not invest in a company just by their whim They also have mandate which they have to fulfill.
When you take out an $8,000 car loan that calls for 48 monthly payments of $225 each, then what is the APR of loan?
Please assist with the attached Data Case assignment
Economy Impacts: An upcoming economy is indicated by rise in stock market, as stock market is primary indicator of a economic strength of a country. Progressing economy results in market boom. Yield of companies’ increases on improving economy,
Workpapers: In finance world, work papers are documents which are created during the procedure of computing the financial records of a business or individual. The accounting professional which is tasked with examining the book-keeping of a business mi
Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of whichrequire semiannual interest payments. Bond A has a coupon rate of 4.0%; a price qu
Regarding the WACC which has to be applied to a project, must it be an expected return, the average historical return or an opportunity cost on similar projects?
Explain new methodology of standard market practice.
Discuss and distinguish between the following applied approaches to theory development: true-income (income statement and balance sheet approaches), efficient markets, and predictive ability. You may want to include in your discussion any articles or studies that either supported or u
Could we explain that goodwill is equal to brand value?
Define the term Vanilla Bonds regarding Corporate Bonds?
18,76,764
1932799 Asked
3,689
Active Tutors
1424557
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!