Investing

A:

According to the Harvard Business Review, companies maximize shareholder value by managing their relationships with all of their stakeholders. Companies use a variety of strategies and investment options to maximize the wealth of their shareholders and create value for customers.

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  • Why is shareholder wealth so important?

    Q: Why is shareholder wealth so important?

    A: Shareholder wealth is important because the shareholders own the company, and in a capitalist society, the measure of a company's value is in the profits it generates for the owners. The primary goal of a for-profit business firm is maximizing shareholder wealth, according to About.com.
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  • What does a shareholder do in a company?

    Q: What does a shareholder do in a company?

    A: According to Investopedia, a shareholder is any person owning at least one share in a corporation. A shareholder has rights outlined in the corporate bylaws. The shareholder can review the company's financial books and sue for actions that negatively impact the corporation.
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  • What is the Rule of 85, and how does it affect retirement?

    Q: What is the Rule of 85, and how does it affect retirement?

    A: The Local Government Pension Scheme 2014 reports that the Rule of 85 determines how someone's retirement benefits are decreased if the person decides to retire before the age of 65. Under the Rule of 85, a person's age at the time benefits are drawn plus the number of years of membership in a pension plan should equal 85 or more to avoid a reduction in benefits.
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  • What are some good techniques for investing in gold?

    Q: What are some good techniques for investing in gold?

    A: Investment experts recommend investing in gold through a variety of avenues, including exchange traded funds, shares of mining companies, futures contracts and derivatives contracts. Some simply purchase and store gold itself. Each of these strategies comes with unique benefits and risks that are not suitable for all investors. Public interest in gold investment has spiked in recent years, creating both opportunity and risk.
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  • Where can I get up-to-date stock market prices?

    Q: Where can I get up-to-date stock market prices?

    A: Up-to-date stock market prices are available on the websites of financial media sources such as CNN Money, Bloomberg News and the Wall Street Journal. Prices may also be available from websites of individual exchanges, such as the NASDAQ Stock Market.
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  • What is the formula for interest compounded annually?

    Q: What is the formula for interest compounded annually?

    A: The formula for interest compounded annually is FV = P(1+r)n, where P is the principal, or the amount deposited, r is the annual interest rate, and n is the number of years the money is in the bank. FV is the amount of money the depositor would have after n years, or the future value of that investment.
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  • What is the difference between direct and indirect investments?

    Q: What is the difference between direct and indirect investments?

    A: Direct investments are those in which the investor owns the particular assets himself, while indirect investments are investments made in vehicles that pool investor money to buy or sell assets, according to Red Mountain Asset Research. A direct investor invests in the asset itself, whereas an indirect investor invests in the expertise of the people using his investment money, notes the National Association of Real Estate Investment Trusts.
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  • What is the difference between a command and a market economy?

    Q: What is the difference between a command and a market economy?

    A: The government has more authority in a command economy, while private citizens and companies have more influence in a market economy, according to Infoplease from Pearson Education. The government directs the types and levels of production in a command market. Private producers choose the amount of goods to supply the market in a market economy.
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  • How do you get started investing in foreign currency?

    Q: How do you get started investing in foreign currency?

    A: Investors can start foreign currency trading by opening a Forex trading account, buying foreign currency CDs, or investing in mutual funds, exchange traded funds or exchange traded notes. Each of these methods comes with different initial investment requirements and unique risks. To be successful in foreign currency investing, it is critical that an investor understand the basic tenets of currency trading and choose the most suitable method of investment.
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  • When was the stock market invented?

    Q: When was the stock market invented?

    A: The first stock market was invented in the 1300s when merchants of Venice began to trade securities received from other governments, according to Investopedia. This was done via slates with information on things for sale, which were carried to meetings with the merchant's clients.
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  • Why is investing important?

    Q: Why is investing important?

    A: One of the main reasons investing money is important is that it helps to create more money. As opposed to just saving money in a bank account, investing money involves choosing to use that money to buy interest or stock in order to earn a return on the money.
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  • What is capital rationing?

    Q: What is capital rationing?

    A: Investopedia defines capital rationing as the act of limiting the number of new projects or investments undertaken by a company. This is done to slow down the spending of capital so that older projects can be completed or to insure that new projects or investments offer higher rates of return.
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  • What is a bull market?

    Q: What is a bull market?

    A: A bull market most commonly refers to increasing stock prices on exchanges such as the NYSE and Nasdaq. It is also used to describe bond and commodity price increases. A bull market is an indication of overall economic health.
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  • Why did the stock market crash in 1929?

    Q: Why did the stock market crash in 1929?

    A: The stock market crashed in 1929 because investors had put too much capital into the stocks by borrowing large amounts of money that they did not truly have. Large sums of money were invested in certain stocks because many investors thought that they were a sure thing.
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  • How do companies maximize shareholder wealth?

    Q: How do companies maximize shareholder wealth?

    A: According to the Harvard Business Review, companies maximize shareholder value by managing their relationships with all of their stakeholders. Companies use a variety of strategies and investment options to maximize the wealth of their shareholders and create value for customers.
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  • What is a revenue model?

    Q: What is a revenue model?

    A: A revenue model is a system through which a business generates income from its products and services. The revenue model is a key component of any business model. It is a business plan that guides a company in generating income by creating value for its customers.
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  • What are crude oil futures?

    Q: What are crude oil futures?

    A: Crude oil futures are contracts related to various types of unrefined oil that are traded in global markets. Crude oil, the most traded commodity in the world, is bought and sold primarily on the New York Mercantile Exchange in the United States.
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  • What is "speculation" in the stock market?

    Q: What is "speculation" in the stock market?

    A: According to the CFA Institute, speculation in the stock market is the practice of engaging in high-risk trading in order to make a significant profit quickly. Speculative trading is not based on traditional analysis of a stock's long-term value and stability. However, it is not conducted haphazardly and involves analysis of short-term variables, such as price fluctuations and market volatility.
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  • How do savings bonds work?

    Q: How do savings bonds work?

    A: Modern U. S. savings bonds are essentially a loan from purchasers to the U. S. government. They are purchased online at face value through the U. S. Department of the Treasury and accrue annual interest for up to 30 years until they are cashed in. Bonds may be cashed in as soon as six months after purchase, but bonds cashed in early are penalized the last three months' worth of interest.
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  • What time does the NASDAQ open?

    Q: What time does the NASDAQ open?

    A: NASDAQ Trader reports that the NASDAQ officially opens for trading at 9:30 a.m. Eastern Standard Time. NASDAQ begins preparing to open at 4 a.m. when a computer starts entering the trades and orders that were received after market close the day before, according to HowStuffWorks.
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  • How are stock prices determined?

    Q: How are stock prices determined?

    A: Initially, stock prices are set by the company with the help of an investment bank and approval of the exchange, according to Jean Folger for Investopedia. After the initial public offering, the market determines the price of the stock.
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