BONDS
HANDOUT GIKAN SAINYONG GWAPO NA TEACHER
STOCKS FORMULAS
STOCKS
𝑐𝑙𝑜𝑠𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝑜𝑝𝑒𝑛𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒
Percent change =
• EQUITY 𝑜𝑝𝑒𝑛𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒
FINANCING 𝑑𝑖𝑣𝑖𝑑𝑒𝑛𝑑
Stock yield ratio =
• Buying stocks 𝑚𝑎𝑟𝑘𝑒𝑡 𝑝𝑟𝑖𝑐𝑒
basically make a Finding the yearly income
part-owner of the 1st: Multiply number of shares and dividend
company
• High risk 2nd: number of payments in a year multiplied
to dividend
STOCKS PROBLEMS
On a certain trading day, eden corp.’s opening price was ₱41.50 and its closing price was ₱39.10. what
is the percent change?
𝑐𝑙𝑜𝑠𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝑜𝑝𝑒𝑛𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒
Percent change =
𝑜𝑝𝑒𝑛𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒
39.10−41.50
= 41.50
≈ −0578
Percent change = -5.78%
CORPORATION a and b each gave a dividend of ₱8 per share of its common stock. The market price of
corporation a is ₱105.80 and the market price of corporation b is ₱140.50. calculate the stock yield ratio
of each.
𝑑𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑑𝑖𝑣𝑖𝑑𝑒𝑛𝑑
corporation a = 𝑚𝑎𝑟𝑘𝑒𝑡 𝑝𝑟𝑖𝑐𝑒
corporation b = 𝑚𝑎𝑟𝑘𝑒𝑡 𝑝𝑟𝑖𝑐𝑒
8
= 105.80 8
= 140.50
Stock yield ratio of corp a:
Stock yield ratio of corp a:
= o.0756
= o.0569
The stock yield ratio allows us to compare two corporations. Even if corporations a and b give the same
dividends, we should also consider, each invested peso would earn more in corporation a than in
corporation b
Find the yearly income of mr.zyrus will receive from an investment in 1000 shares of cnn stock if a
dividend of ₱14.80 per share is paid quarterly
If jon snow owns a share of stock that costs ₱960 and pays quarterly dividend of ₱22.40, what is the rate
of income of his stock investment?
22.40 𝑥 4
Percent change = 960
1
= 0.0933 or 93%
BONDS PROBLEMS
Find the amount of semi-annual coupon for a ₱500,000 bond which pays 5% interest, compounded semi-
annually for its coupons.
𝑖𝑛𝑡𝑒𝑟𝑒𝑠𝑡
coupon= bond(𝑐𝑜𝑛𝑣𝑒𝑟𝑠𝑖𝑜𝑛 𝑝𝑒𝑟𝑖𝑜𝑑)
0.05
= 500,000( 2
)
Coupon = ₱12,500
1
Mr. ironborn owns 45 bonds with a par value of ₱1000.00 each and pays 8 % interest. What annual
2
income does mr. ironborn get from these bonds? .
Par value of 45 bonds: 45 x ₱1000.00 = ₱45,000.00
Interest = par value x rate x time
Interest ₱45,000 x 0.085 x 1 = ₱3825
WEAK FORM
• STATES THAT STOCK PRICES CORRECTLY REFLECT ALL THE HISTORICAL Information about
the stock
STRONG FORM
• STATES THAT STOCK prices correctly reflect all the public and private information about the
stock