1. Capital Budgeting Decisions
1.1. NPV
1.2. IRR
1.3. Equivalent Costs (Comparing 2) EAC
1.4. Payback Methods
1.4.1. Simple
1.4.1.1. Formula: [initial investment] - [projected cash flow for one month] = [payback for 1 month] ---drag the cells to calculate over time
1.4.2. Discounted
1.5. Net working capital
1.5.1. Calculating NWC
1.5.2. Delta NWC
1.6. "Should you invest in this project?"
2. Debt, Bonds, Interest Rates
2.1. Bonds
2.1.1. Price of bond
2.1.2. Present value of bond
2.1.3. YTM
2.1.4. Credit rating agencies (CRAs)
2.1.5. Comparable bond valuation
3. Equity and Stocks
3.1. Types of shares
3.1.1. Listed/Unlisted
3.1.2. Common or ordinary
3.1.3. Preferred
3.1.4. Partially paid or contributing
3.2. Private equity
3.2.1. Initial public offering (IPO)
3.2.2. Seasoned equity offering (SEO)
3.3. Primary/Secondary markets
3.4. Calculate fair value
4. Risk, Return, Portfolios
4.1. Expected Rate of Return
4.1.1. Scenario Formula
4.1.2. Realised returns formula
4.2. Realised rate of return
4.2.1. Capital gain yield
4.2.2. Dividend yield
4.3. Investment risk
4.3.1. Standard diviation
4.3.1.1. Formula
4.3.2. Variance
4.3.3. Risk free asset and rate
4.4. Portfolios
4.4.1. Portfolio with 2 stocks
4.4.1.1. Estimating expected rate of return
4.4.1.2. Estimating standard diviation
4.4.2. Diversification
4.4.3. Firm-specific risk
4.4.4. Systematic risk
4.5. Mean-Variance (MV) Analysis
4.5.1. MV with risky assets
4.5.2. Port with lowest stand dev
4.5.3. Mean Variance frontier
4.5.4. MV tangent
4.6. Sharpe Ratio
4.6.1. Tangent line
4.7. Two-fund separation theorem
5. Systematic Risk, Capital Asset Pricing Model (CAPM)
5.1. Estimating systematic risk
5.1.1. Covariances between stock returns
5.1.2. CAPM beta: a formula
5.2. Estimating beta in Excel
5.2.1. 1. tools >add-ins > analysis toolpak
5.2.2. 2. Download data from yahoo finance
5.3. Estimating beta: an example
5.4. Capital Asset Pricing Model (CAPM)
5.4.1. CAPM Tl;DR
5.4.2. CAPM formula
5.4.3. Risk-free rate
5.4.4. Market risk premium
5.4.5. Size effect/risk
5.4.6. Book to market effect
5.4.7. Fama-French three-factor model
6. Weighted Average Cost of Capital
6.1. Cost of capital
6.1.1. Balance sheet
6.2. Cost of equity
6.2.1. Revisiting CAPM