Investment - Asset Study Paper - Initial Discussion of Paper Winter 2011 Fin / Invest / Business Law Cluster Kevin C. Kaufhold 1

Very good graduate / professional example of Asset Study --- “Financial Analysis of Industry and Selected Firms”, 2009:2 Conducted Top – Down Approach AND Fundamental Analysis Both Intrinsic and Relative Value calculated and independently determined by authors Market Neutral Strategy Selecting both a long and a short Returns are solely based on manager ability Used in many hedging strategies 2

Your paper will be MUCH Simpler ---- Only one Asset to study (stock, bond, commodity, etc) Can look at a long position for hold, buy, or sell Or can be more sophisticated investing strategy But will need to correspondingly increase complexity and detail of paper Do NOT need to do extensive Top-Down Analysis Do NOT need to independently calculate valuation levels 3

Outline of Paper --- Biography on Company, its products, its competitors, etc Then, an abbreviated top-down review (no independent analysis) Basic info on macro economy and how company is being affected Basic info on industry and company position in industry With citations to others in support of the review 4

Then, discussion of valuation Cite to intrinsic / relative value calculations of others Use and compare multiple sources for the valuation estimate Discuss how / why sources come to these conclusions Compare to current asset price 5

Analysis / Opinion (i.e. Yours ! ) --- Do you feel asset is fairly valued? Over or under valued? Why? Factor in company position, products, industry, macro climate Would you recommend a buy / sell / hold Why? And in what time frames? Remember to appropriately cite and list references 6

Disclose Personal Investment Positions on Asset under Review Conflict rule for all analysts who provide investment advice Avoids litigation in real life Good to state whether or not you own / employed / or have some type of economic relationship with asset under review Do not disclose anywhere in paper material, non-public, insider information on asset under review that you may know of Best not to analyze any asset that you have detailed working knowledge of (i.e. your own employer !) 7

Appropriately cite and list references Some sources to consider --- Wall Street Journal; Yahoo finance; MSN Money Value-Line (at Belleville Public Library) Morningstar (at Lindenwood Library) Professional analysts via brokerage accounts Business articles on company, industry, economy, etc 8

Comments ? Questions ? 9