1. Waseda Financial Investment Team 7 th November 2011

2. Market update  Ugly week for stocks  Greece referendum  G20 discussions unfavorable  Good  ECB announced rate cut (25bp to 1.25%)– SURPRISING!  Jobless number below  Nonfarm payrolls grow by 80k  Bernanke’s assurance

3. Companies  MF global file for bankruptcy  Nomura net loss (-590M)  J&J purchase of Synthes  antitrust?  Anglo American buy Oppenheimer’s stake in Debeers

4. FX  BoJ intervene on Monday

5.  Euro/USD  Rate cut  EURO fell initially  EURO strengthened on  Greece cancelling referendum  Continued fall on dollar on loosening policies

6. Options trading Call

7. Short call

8. Put

9. Short put

10. Long butterfly Buy one call x1, short two calls x2, long one call x3

11. Straddle Buy put and call

12. Strangle Put and call at different Strike px

13. Spread

14. Bear Spread

15. Net-net

16. How much will you pay?  Furniture $100  Building $10,000  Land $50,000  Total $60,100  Loan $30,000

17. JP: 8066 MITANI CORP (billion JPY) Cash and equivalent33 Receivables and inventory70 Factories, real estate25 Note receivable3 Total tangible assets131 Less Debt86.5 TOTAL NET ASSET44.5 If you are the owner of this business, how much will you sell? a)33billion b)44.5 bn c)>44.5 bn Generated 0.8bn profit over last 10 years Dividend of 0.4bn last year

18. Principles of net-net investing  Assume company will be liquidated  Net Net Working Capital = Cash and short-term investments + (0.75 * accounts receivable) + (0.5 * inventory) – total liabilities

19. Risk  Will markets correct?  Japan  Activist investor  How long?