Operational Risk Poses Challenges to Financial Institutions and Regulators

In the aftermath of September 11’s terrorist atrocities, it will surprise few people to learn that operational risk has been a hot topic of debate among financial institutions and regulators. Unlike risks of borrowers defaulting on debt or markets collapsing, operational risk management deals with internal system failures (such as a rogue trader) or external events (such as terrorist attacks). A conference organized by Wharton’s … [ Read more ]

Capitalizing on Economic Value Added

EVA is a measurement tool designed to strengthen companies’ return on capital investments. A study of best practices in EVA reveals that the metric can help reduce capital costs and improve gross revenues.

The 14-Year Bear Itch

Article takes a look at historical bull and bear runs that occur in roughly 14-year cycles (secular = major multi-year trends in Wall Street speak).

The Great Stock Illusion

Over long periods stocks way outperform bonds, right? Maybe not. A new study raises the disturbing possibility that this conclusion derives from a misreading of history.

The Global 100

Many decisions CFOs make — how to raise capital, where to outsource, whether to expand — are deeply influenced by a network of politicians, financiers, and other individuals around the world. For the first time, CFO Magazine presents its list of fivescore bankers, investors, regulators, and rule-makers — as well as gadflies, opinion leaders, organizations, and forces — that have the greatest influence on the … [ Read more ]

Calculator Tutorials

This page offers tutorials dealing with time value of money calculations for the following calculators:
– HP 10B
– HP 17B II
– HP 12C
– TI BAII Plus
– TI 83 and TI 83 Plus

An ROI primer: Learn the basics and the key shortcomings of this metric

This article uses a hypothetical IT server project to illustrate the calculation of ROI. It also presents some arguments regarding the strength and weakness of the metric (and a specific example of how to calculate present value with Excel).

Editor’s Note: Pretty basic stuff but a good read for the financially challenged.

Escaping Excel Hell

Still using Excel to plan your budgets? Still frustrated by inaccurate forecasting? Help – called active financial planning – is on the way.

Read Part 2, “8 Ways to Take Control”

Andrew Lo

Why do so many people cling so hard to the notion of efficient markets? Andrew Lo, an economist at MIT, suggests that they may be suffering from a “peculiar psychological disorder known as ‘physics envy’…We would love to have three laws that explain 99% of economic behaviour; instead, we have about 99 laws that explain maybe 3% of economic behaviour. Nevertheless, we like to talk … [ Read more ]

Commercial Paper Chase

If banks have to come clean about their off-balance-sheet leverage, get ready to pay more for money.

Should You Follow the Insiders?

Mimicking their trades in company stock is no sure road to riches.

Log On America

In this case study, Professors Pierre Hillion and Theo Vermaelen use Log On America’s decision to issue a floating-price convertible preferred stock to discuss optimal capital structure. You are asked to compare this financial innovation with alternatives such as equity financing, debt financing and convertibles with a fixed conversion price. Then you’re asked to support (or undermine) the legal case of LOA against the banks … [ Read more ]

Looking for Evidence of Accounting Chicanery? Try Digging Deeper

When Enron collapsed last year amidst allegations of misleading financial statements, it joined a long list of companies that had originally been given clean bills of health by auditors and analysts, only to have that information later discredited. Yet according to analyst and author Howard Schilit, businesses were, in fact, broadcasting their misdeeds long before corporate watchdogs caught on. The problem is that nobody was … [ Read more ]

XE.com – The Universal Currency Converter ®

The Universal Currency Converter®, the world’s most popular currency tool, allows you to perform interactive foreign exchange rate calculations on the Internet, using live, up-to-the-minute currency rates.

Shell Game

Now that the window for initial public offerings has all but closed, more Wall Street-bound companies are flirting with controversial reverse mergers.