Review Of Video Resource ' Stock Valuation ' Essay
Chi Ha, Thomas Hassell, Adrian Francis, Rory Rodney
Corporate Finance/ FIN/571
June 29, 2015 Paul Stevens
This concept review video resource ‘Stock Valuation’ underscores the importance of individual investors gaining comprehensive knowledge of stock. Team D will discuss how markets and investors value a stock, such understanding is necessary for sound financial decision making especially in the age of market democratization, where individual investors manage their portfolios. In so doing the ensuing paper will look at stocks and bonds, valuation techniques and evaluating a stock investment. Moreover, the team focus is the video 's principal contributor advice to investors to focus continually on gaining knowledge about stocks’ definition, symbolism, and trading dynamics.
Stocks & Bonds Companies have few options to raise capital, either issuing bonds or selling stocks to investors when they meet the Securities and Exchange Commission 's (SEC) requirements. Bonds are safe but have a lower rate of return for investors for when the bonds mature, only the principal balance and all the interest are repaid (Parrino, Kidwell & Bates, 2012). On the other hand, a stock can yield high return or nothing at all even to the point of losing the principal investment. There are two types of stocks, common and preferred. Common stocks are those that give owners the benefits of limited…