Capital markets research in accounting.

Assignment Help Accounting Basics
Reference no: EM13151629 , Length: 1311words

 an application question which is about "capital markets research" in accounting.

"Marcus Padley, a stockbroker, made the following statements in an article in The Sydney Morning Herald.
I love 'the Warren Buffet Way'. In fact, one of my first clients introduced himself by saying,' I am Fred and I'd like to invest the Warren Buffet Way'. Well whoopee do! What shall we do? Get the annual reports of the top 200 companies. Analyse the accounts of each, assets 'value' and then go to the stock market and find out that 'wow, i'm right and the whole market is wrong' and the share price is trading below the true 'value'. The purchase the shares and wait for that value to inevitably emerge.

In fact most Warren Buffett-based approaches are terrible at timing, which in reality is about the only thing that really matters. In an increasingly impatient market it is not just about 'what', it is becoming all about 'when'. Investors who sat through the 54.5 per cent fall in the market in the financial crises need to earn 113% to get their money back. That's 13 years of compounding average annual returns. Not caring about 'when' just cost us 13 years."

Critically evaluate the 2 statements made by Marcus Padley in the context of capital market research. 

Reference no: EM13151629

Questions Cloud

Find confidence interval for the mean monthly rent : Find a 95% confidence interval for the mean monthly rent for unfurnished one-bedroom apartments available for rent in this community.
Explain a schematic diagram of the work up procedure : prepare a schematic diagram of the work up procedure, including the column chromatography with acetylferrocene, diacetylferrocene, ferrocene
Recognizing the sale of the undeveloped land : Purple never used the land for any business purpose during the time it was owned by the corporation. What amount of loss can Purple Corporation recognize on the sale of the undeveloped land?
How many grams of dry nh_4cl need to be added : How many grams of dry NH_4Cl need to be added to 2.10 L of a 0.100 it M solution of ammonia, NH_3, to prepare a buffer solution that has a pH of 8.84? K_b for ammonia is 1.8 * 10^{-5}
Capital markets research in accounting. : an application question which is about "capital markets research" in accounting. "Marcus Padley, a stockbroker, made the following statements in an article in The Sydney Morning Herald.
Explain how the fed use of its three tools of monetary : Explain how the Fed's use of its three tools of monetary policy affect supply and demand in the market for reserves and the equilibrium federal funds interest rate.
Probability of emergency program at the end of next year : An emergency program set up by the state. approximate the probability that the intersection in question will come under the emergency program at the end of the next year.
Residual value of a leased asset : If the residual value of a leased asset is greater than the amount guaranteed by the lessee, the lessee:
Draw the world relative supply curve rs for good x : Draw the world relative supply curve RS for good X. Label all the axes (relative price of good X on the vertical axis and world output of x relative to y on the horizontal axis) and the relevant points.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Computing break-even point and after-tax target profit

Jo Manufacturing Company provides the following data from 2011: 20,000 units were sold for $60 each; total variable expenses were 900,000 and total fixed expenses were $240,000. Jo's income tax rate is 30%.

  Compute the amount of financial revenue

Compute the amount of financial revenue that will be earned over the lease term and the manufacturer's profit that will be earned immediately by Aquarius

  What is weetons variable overhead spending variance

Managers of Weeton Manufacturing are analyzing variable overhead variances for the fiscal period just ended. The flexible budget called for $80,000 in variable overhead but actual variable overhead was $95,000.

  Analysis of rate of return

Create a formula to calculate your rate of return for each year. What is your overall return over the life of your investment? What is the average annual return over the life of the investment? Use the geomean function.

  Explain how shaving 5% off the estimated direct labor hours

Explain how shaving 5% off the estimated direct labor hours in the base of the predetermined overhead rate usually results in a big boost in the net operating income at the end of the year.

  Problem related to marginal tax rate for firm

For the year ending June 30, 2008, the Austin Corporation has current assets of $ 275,000 and total assets of $ 900,000. It also has current liabilities of $ 150,000, equity of $ 200,000, and retained earnings of $ 100,000. The marginal tax rate f..

  How much inventory can baker purchase

How much inventory can Baker purchase without violating its debt agreement if their total current assets equal $15 million.

  Determining actual direct labor rate

The Reedy Company uses a standard costing system. The following data are available for November: The actual direct labor rate for November is:

  What is a constructive dividend

What is a constructive dividend? Under what circumstances is the IRS likely to argue that a constructive dividend has been paid?

  Journalize the exchange for delmar company

Delmar's forklift cost $33,600, had accumulated depreciation of $27,600, and has a fair market value of $3,600. Hamilton's forklift cost $25,200, had accumulated depreciation of $21,600, and has a fair market value of $3,600. a- journalize the exc..

  Sufficient understanding and reliable evidence

Auditors should understand the five components of internal control that are sufficient to assess the risk of material misstatement of the financial statements, whether due to error or fraud, and to design the nature, timing, and extent of further ..

  Volume-based system and strategic activity-based system

Prepare a table that illustrates the percentage change in costs between the volume-based system and the strategic activity-based system.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd