Forbes Guide to the Markets: Becoming a Savvy Investor

Forbes Guide to the Markets: Becoming a Savvy Investor

by Forbes LLC, Marc M. Groz

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Product Details

ISBN-13: 9780470463383
Publisher: Wiley
Publication date: 09/28/2009
Pages: 312
Sales rank: 1,287,139
Product dimensions: 7.40(w) x 9.00(h) x 0.80(d)

About the Author

Marc M. Groz is a leading authority on financial markets,with a deep understanding of hedge funds, risk management, and theinterplay of liquidity, transparency, and valuation in marketdynamics. Currently, he serves as managing member and chiefinvestment officer of Topos LLC, a Stamford,Connecticut–based alternative asset manager, investor, andrisk advisor.

Forbes®  is the leading business magazine inthe United States, with an audience of more than 5 million readers.Since 1917, Forbes' mission has been to provide access toinformation and insights that ensure its readers' success.

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Table of Contents

Acknowledgments.

Note to the Reader.

About the Author.

Introduction: Becoming a Savvy Investor.

Section I Establishing a Frame of Reference.

Chapter One From “Dumb” Barter to IntelligentAgents.

Chapter Two Point-Counterpoint.

Stocks.

Mutual Funds.

Bonds.

ETFs.

Options.

Futures.

Summary.

Chapter Three Confronting Information Overload.

Investor Constraints.

Investor Choices.

Investor Safety.

Section II Stocks and Equity Markets.

Chapter Four Varieties of Stocks.

Just What Is a Security, Anyway?

Issuers and Underwriters: Why Does a Corporation Sell Stock tothe Public?

Why Investors Buy Stock.

Summing Up Total Return: Dividends and Capital Gains.

A Letter to Our Shareholders: Annual and Quarterly Reports (andFilings).

Making Sense of Types, Classes, and Other Stock Categories: AMap of the World of Stock.

Chapter Five Stock Markets.

The Big Board.

The Incredible Growth of Trading and Capital.

National Association of Securities Dealers Automated QuotationSystem (Nasdaq).

Technology, Dark Pools, and the Evolution of a UnifiedMarket.

Chapter Six Three Views of the Numbers.

Fundamental Analysis.

Technical Analysis.

Quantitative Analysis.

Chapter Seven Where to Find Information on Stocks andFinancial Markets.

A Selection of Information Sources on the Financial Markets.

Chapter Eight How to Buy and Sell Stock.

Full-Service Brokers.

Discount Brokers.

Financial Intermediaries.

Direct Purchase.

If It Sounds Too Good to Be True . . . Protecting Yourself fromStock Scams.

A Note on Financial Planners.

Section III Mutual Funds and Investment Companies.

Chapter Nine A History and Overview of the Mutual FundBusiness.

Open-End versus Closed-End Funds.

Index Funds.

Load versus No-Load Funds.

Chapter Ten Advantages of Mutual Funds.

Simplicity.

Diversification.

Access to New Issues.

Economies of Scale.

Professional Management.

Indexing.

Chapter Eleven Disadvantages of Mutual Funds.

Impact of One-Time Charges and Recurring Fees on FundPerformance.

Hidden Cost of Brokerage.

Some Hidden Risks of Fund Ownership.

Chapter Twelve Sources of Information on MutualFunds.

Investment Company Institute Classification of Types ofFunds.

Lipper Analytical Services.

Forbes.

Morningstar.

Chapter Thirteen Alternative Investments.

Hedge Funds.

Funds of Hedge Funds.

Other Alternatives.

Section IV Bonds and Other Fixed-Income Securities.

Chapter Fourteen Seven Characteristics of Bonds.

The Lifespan of Bonds.

Interest versus Discount.

Relationship of Price to Yield.

Four Important Yield Measures.

Credit Quality, Ratings, and Insurance.

Call and Related Features.

Fixed versus Floating Rates and Foreign Currencies.

Chapter Fifteen How the Other $30 Trillion IsInvested.

Treasuries.

Corporates.

Mortgage-Backed Securities and Other Asset-BackedSecurities.

Municipals.

Money Market.

Summary.

Section V Options, Futures, and Other Derivatives.

Chapter Sixteen Options.

Exchange-Traded Options.

Combination Strategies.

Determining the Value of an Option.

Chapter Seventeen Futures.

A Seller’s Need to Hedge . . .

Some Buyers Need to Hedge, Too.

Speculation or Insurance? Maybe a Little of Both.

Actuals versus Cash-Settled Contracts.

Margin and Collateral.

Chapter Eighteen Other Derivatives.

Section VI Summing Up Risk and Return.

Chapter Nineteen How Well Are My Investments Doing?

The Basics of Return.

Annualized Returns: Arithmetic (Simple) or Geometric(Compound)?

Time-Weighted Returns versus Money-Weighted Returns.

Complicating Factors.

Chapter Twenty Coming to Grips with the Many Dimensions ofRisk.

A Definition of Investment Risk.

The Relativity of Risk.

What Is Market Risk?

“It Will Fluctuate”.

Other Kinds of Investment Risk: From the Quantifiable to theSubjective.

Balancing Risk and Return.

Chapter Twenty-One A Crescendo of Change.

Again, We Ask, What Is a Market?

Glossary.

Index.

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