Finance

Don’t start with the money!

Remember him?

Why Finance?

“People don’t buy what you do, they buy why

you do it.”

Can money make me happy?

Should I invest in this?

Should I invest in this?

TIMEMONEY

K W LFINANCE & FINANCIAL LITERACY

How should I invest $3000?

Brokerage Firm #1

Brokerage Firm #2

Brokerage Firm #3

Paolo Pedro Gonzalo

Daniela Gisella Bobby

Andrea Karen Carolina

Augusto Domenico Stefan

FINANCE PRINCIPLE #1: Time Value of Money

Time Value of Money

What is the future value of $3000 if you invest that money at

8% for two years?


How long would it take for that money

to double?


What you do--or don’t do--

with your money today, affects you in the future.


What you do--or don’t do--

with your time today, also

affects you in the future.



Setting important goals and being DISCIPLINED enough to achieve

them.

The first part of finance is about:


If you spend your money

wisely today, it will pay off in

the future.


If you spend your time

wisely today, it will pay off in

the future.

FINANCE QUIZ

What is the time value of money?

And why is this important?

Question

FINANCE QUIZ

A dollar today is worth more than a dollar tomorrow.

INVEST!

Answer

FINANCE QUIZ

What is interest?

Question

FINANCE QUIZ

The charge for the privilege of borrowing money, typically

expressed as an annual percentage rate.

Answer

Interest is commonly calculated using one of two methods: simple

interest calculation, or compound interest calculation.

FINANCE QUIZ

What is compound interest?

Question

FINANCE QUIZ

Interest that accrues on the initial principal and the accumulated interest of

a principal deposit, loan or debt. Compounding of interest allows a

principal amount to grow at a faster rate than simple interest, which is calculated

as a percentage of only the principal amount.

Answer

FINANCE QUIZ

Answer

FINANCE QUIZ

What is a

stock?

Question

FINANCE QUIZ

Answer

At some point, just about every company needs to raise capital, whether to open up a West Coast

sales office, build a factory, or hire a crop of engineers.

In each case, they have two choices: 1) Borrow the money, or 2) raise it from investors by selling them

a stake (issuing shares of stock) in the company.When you own a share of stock, you are a part

owner in the company with a claim (however small it may be) on every asset and every penny in

earnings.

FINANCE QUIZ

Answer

the capital raised by a business or corporation through the issue and

subscription of shares.

shares of a company that a person

FINANCE QUIZ

Answer

Nevertheless, it's that ownership structure that gives a stock its value. If

stockowners didn't have a claim on earnings, then stock certificates would be

worth no more than the paper they're printed on. As a company's earnings improve, investors are willing to pay

more for the stock.

FINANCE QUIZ

What is a

bond?

Question

FINANCE QUIZ

Answer

A debt investment in which an investor loans money to an entity (corporate or governmental) that

borrows the funds for a defined period of time at a fixed interest rate. Bonds are used by companies,

municipalities, states and U.S. and foreign governments to finance a variety of projects and activities.

Bonds are commonly referred to as fixed-income securities and are one of the three main asset classes,

along with stocks and cash equivalents.

FINANCE QUIZ

Answer

Two features of a bond - credit quality and duration - are the principal determinants of a bond's interest

rate. Bond maturities range from a 90-day Treasury bill to a 30-year government bond. Corporate and

municipals are typically in the three to 10-year range.

FINANCE QUIZ

What is a

mutual fund?

Question

FINANCE QUIZ

Answer

An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the

fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's

portfolio is structured and maintained to match the investment objectives stated in its prospectus.

FINANCE QUIZ

Answer

One of the main advantages of mutual funds is that they give small investors access to professionally

managed, diversified portfolios of equities, bonds and other securities, which would be quite difficult (if not impossible) to create with a small amount of capital.

FINANCE QUIZ

What is an ETF?

Question

FINANCE QUIZ

Answer

A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a

stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold.

FINANCE QUIZ

What are the indexes like

NASDAQ, DOWN JONES, S&P 500?

Question

FINANCE QUIZ

What is an IPO?

Question

WHAT’S AN IPO?

FACEBOOK’S IPO

Finance

Economy & Finance

Transcript of Finance