The Four Basic Areas of Finance Investments Financial Institutions International Finance Corporate Finance Introduction – Fin301

Investment What kinds of investment tools we have? How to issue new securities? Security Markets Listing and listing requirements NYSE is a dealer market or an auction market? What do Investment banks do? Goldman Sachs, Merrill Lynch, JPMorgan, Lehman Brother, Saloman Smith Barney, Morgan Stanley Investment banking: Underwrites IPOs, SEOs, places private equity ... Brokage Service: execute security transaction, offers M&A advisory services ... Introduction – Fin301

Financial Institutions Commercial Banks Savings institutions credit unions mutual funds insurance companies pension funds Introduction – Fin301

International Finance Foreign Exchange Risk Political Risk Terms like LIBOR, EURO, Eurodollar What would be the impact on Japanese products if Yen Strengthens against Dollar? Introduction – Fin301

Corporate Finance Introduction – Fin301

Organization Chart Introduction – Fin301

Corporate Objective??? Introduction – Fin301

Financial Managers’ Decisions Investment Decisions Financing Decision Capital Budgeting Capital Structure Working Capital Risk Management Introduction – Fin301

To Maximize shareholders’ wealth, managers should learn / know Calculate cash flow timing of cash flow risk of cash flow tax treatment of cash flow financing of investment options to undertake future actions Introduction – Fin301

The Agency Problem The agency relationship Agency Costs How do agency costs affect firm value Any problem other than the agency problem? Introduction – Fin301