Английский язык. Практический курс для решения бизнес-задач
Шрифт:
6. the date that a contract expires
7. a bond offered by state and local government
8. a company’s purchase of its outstanding stock
9. a negotiable debt obligation issued by the U.S. Treasury with maturities of 13, 26, and 52 weeks; non interest bearing but issued on a discount basis instead
10. coupon securities issued by the U.S. Treasury with semi-annual interest and maturities of 10 to 30 years
11. securities issued by the U.S. Treasury bearing interest and with maturities of 2 to 10 years
12. annual percentage rate of return, determined by dividing income by principal; or the effective rate of interest paid on a note or bond
13. the normal tendency of yields to rise with the increasing maturity of the security
Exercise 3. Read the following text describing different types of investors. Identify which type is closest to your personality and devise an investment strategy for yourself, and for the following individuals: 1. A semi-retired professor; 2. A 40-something engineer with two teenage children; 3. A housewife in her early thirties married to a rich businessman; 4. A computer genius in his mid twenties.
The Successful Investment Journey
Know Yourself
Nobody knows you and your situation better than you do. Therefore, you may be the most qualified person to do your own investing – all you need is a bit of help. Identify the personality traits that can assist you or prevent you from investing successfully and manage them accordingly.
A very useful behavioral model that helps investors to understand themselves was developed by Bailard, Biehl & Kaiser.
The model classifies investors according to two personality characteristics: method of action (careful or impetuous) and level of confidence (confident or anxious). Based on these personality traits, the BB&K model divides investors into five groups:
Individualist – careful and confident, often takes a
Adventurer – volatile, entrepreneurial and strong willed
Celebrity – follower of the latest investment fads
Guardian – highly risk averse, wealth preserver
Straight Arrow – shares the characteristics of all of the above equally
Not surprisingly, the best investment results tend to be realized by an individualist, or someone who exhibits analytical behavior and confidence and has a good eye for value. However, if you determine that your personality traits resemble those of an adventurer, you can still achieve investment success if you adjust your strategy accordingly. In other words, regardless of which group you fit into, you should manage your core assets in a systematic and disciplined way.
Source: Investopedia, March 10, 2006, by Derek Polcyn, CFA
Exercise 4*. Find antonyms for the following terms and make sentences of your own with each pair.
Example: upstream – downstream
upside —…….
budget deficit —……….
developed markets —…….
loss-making —………..
in the red —……….
upgrade —……..
public sector —……..
individual investors —………
primary market —………
outperform —……..
Exercise 5*. Fill in the blanks using terms given below.
Why Stock Investors Should Purchase Bonds
No doubt……. outperformed……. for two years in a row. While past…….. cannot guarantee future results, recent market…… provides compelling enough evidence for most investors to consider an overall……. that solidly integrates these two important…….. classes.
Stocks still present…….. with the potential for excellent long-term……. But simply owning stocks – and leaving excess cash in a……. fund – may not be the optimal way to safeguard your…….. assets. In fact, SalomonSmithBarney currently recommends investors to include bonds, stocks and……. in their overall portfolio. Of course, only your specific goals and risk……… can dictate what…….. is right for you, but bear in mind that a balanced portfolio of both bonds and stocks would have outperformed an…….. portfolio over the past two years, and helped to dampen some of the volatility that characterized the……..
Undoubtedly, the primary reason you have purchased stocks has been to achieve……… in your investment portfolio. But did you know that bonds can help you achieve a number of complementary……..? The three most important are: (1) to preserve…….; (2) to supplement current…….; and (3) to enhance total…….. As the old…….. adage proclaims: Make your money in stocks, but keep your money in bonds.
The first two objectives are particularly relevant for investors whose portfolios are heavily…… in equity securities. Regarding capital preservation, the recent equity market volatility has confirmed once again that stocks are long-term investments and are not necessarily the most appropriate way to meet either short-term or more…… financial needs that are more predictably provided by…….. securities.
More evident, perhaps, is the stock investor’s diminished ability to generate income from equity…….. Until recently, stocks issued by many companies paid relatively high…….. Many investors even depend on stock dividends to……. their current income.
However, due to widespread government……… and growing investor demands for stock price………., high dividend-paying equities have become scarce as many companies have been forced to become more……… This has diverted…….instead to other corporate activities such as the purchase of new equipment, acquisitions or stock……..
Replace Disappearing Dividends
First the bad news: vanishing stock dividends are unlikely to reverse……. anytime into the……. future. The……. is further entrenched by large financial…….. now given to senior corporate managers and board members, commonly tied to stock price performance.
The good news, however, is that by complementing your equity holdings with a……… bond portfolio, you can establish a more predictable income……. Best of all, fixed-income securities afford you an enormous amount of……… to receive………. payments on a monthly, quarterly or semi-annual basis.