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PART II: VALUATION

Link-sets

Statistical Analysis

Time Value of Money

• American Association of Individual Investors (AAII).
  http://www.aaii.com
• Amortization Calculator. Interactive program calculates your periodic payment for a given loan balance and stated, or nominal, interest rate. In addition, creates a loan amortization schedule and it can handle a balloon payment too.
  http://ray.met.fsu.edu/~bret/amortize.html
• "Annual Percentage Rate (APR) vs. Annual Percentage Yield (APY): How the Distinction Affects You". Excellent article courtesy of Investopedia.com.
  http://www.investopedia.com/articles/basics/04/102904.asp
• Barron's Online. Presents an overview of world markets, expert investment ideas and advice, and a complete statistical review of the preceding week's trading and financial activity.
  http://www.barrons.com/
• Behavioral Finance, Stock Valuation and Stock Image. A tool and a science to value stocks and understand and master stock markets and investment -- with a behavioral finance viewpoint -- courtesy of Peter Greenfinch. (Français) (Español)
  http://perso.wanadoo.fr/pgreenfinch/
• Bloomberg.com. Financial markets news and information.
  http://www.bloomberg.com
• Bond Calculator. Nice interactive bond valuation calculator. Note: for the "yield to maturity" input you need to put in your "nominal" required annual return.
  http://www.calculator.com/calcs/bondcalc.html
• Bond Duration. Nice, detailed explanation of "bond duration" -- how to calculate it, what it means, and more.
  http://www.regentschoolpress.com/BondDuration.pdf
• BondMarkets.com. The Bond Market Association web site -- see especially "An Investor's Guide to Corporate Bonds".
  http://www.bondmarkets.com/
• A Bond Primer. Good overview of bond basics from SmartMoney.com. And, check out their Economy & Bonds section too.
  http://www.smartmoney.com/onebond/index.cfm?story=primer
• BondSchool.com. Online source to educate financial professionals (and us regular folks too) about different types of fixed-income investments. It includes information about retail corporate bond offerings, structured products, agency bonds, and more.
  http://www.bondschool.com/
• The Bond Strategist. Previews and reviews of credit markets and their related economies.
  http://bondheads.com/
• BONDTALK.com. Bond news, information, analysis -- plus, an educational section on bond basics.
  http://www.bondtalk.com/
• Business Valuation Techniques Information at Business.com. Links to information on analytical approaches to valuing a firm, including cash flow, economic value added, ratio comparison and valuing equity as an option.
  http://www.business.com/directory/financial_services/ investment_banking_and_brokerage/mergers_and_acquisitions_manda/ business_valuation_techniques/
• CAP@Columbia. A cornucopia of great material from the Securities Analysis and Investment Courses at The Graduate School of Business, Columbia University, New York City.
  http://www.capatcolumbia.com/
• Certificate of Deposit Calculator. This calculator finds out how much interest you can earn on a Certificate of Deposit (CD). Just enter a few pieces of information and it will calculate your Annual Percentage Yield (APY) and ending balance.
  http://www.finance.cch.com/sohoApplets/CertDeposit.asp
• CFA Institute. [Fomerly the Association for Investment Management and Research (AIMR).] Learn about the CFA Institute, the Chartered Financial Analyst (CFA) designation and more.
  http://www.cfainstitute.org/
• ClearStation. Enter a stock ticker symbol and get Key Ratios (and stock beta), Profile & Fundamentals, Interactive Graphs, and more.
  http://clearstation.etrade.com/
• Continuously Compounded Interest Formula and Calculator. Cool calculator also handles other compounding periods.
  http://www.moneychimp.com/articles/finworks/continuous_compounding.htm
• DividendDiscountModel.com. Gives you access to the popular Dividend Discount Model (DDM) used to value publicly traded common stocks.
  http://dividenddiscountmodel.com/
• Dr. Ed Yardeni's Economics Network. Great site for economic and financial information.
  http://www.yardeni.com/
• Earnings.com. Gets you the latest corporate information, with access to live webcasts and online replays, free annual reports, earnings releases, conference calls, splits, dividends and a lot more. (Formerly known as FullDisclosure.com.)
  http://www.earnings.com/
• The Efficient Market Hypothesis. Nice essay on "The Efficient Market Hypothesis & The Random Walk Theory" courtesy of Investor Home.
  http://www.investorhome.com/emh.htm
• EVA Valuation Tutorial. Economic Value Added (EVA) valuation tutorial courtesy of software company Valuatum. (TIP: Seems to work better when used with Explorer browser.)
  http://www.valuatum.com/valuation/valuation_tutorial_tiedostot/frame.htm
• Fedpoint 28: Estimating Yields on Treasury Securities. How to compute yields on Treasury securities -- discount yield and investment yield methods.
  http://www.newyorkfed.org/aboutthefed/fedpoint/fed28.html
• FedStats. Gateway to statistics from over 100 U.S. Federal agencies.
  http://www.fedstats.gov/
• Financial Calculator Tutorials. Tutorials are courtesy of Dr. Timothy Mayes and cover the HP 10B, HP 17B II, HP 12C, and TI BAII Plus calculators.
  http://clem.mscd.edu/~mayest/calculators/calculator_tutorials_index.htm
• The Financial Data Finder. Extensive set of data links courtesy of Ohio State University.
  http://www.cob.ohio-state.edu:80/~fin/osudata.htm
• The Financial Forecast Center. Stock market, interest rate, inflation, and currency exchange rate data, trends, and forecasts.
  http://www.neatideas.com/
• Financial Pipeline. Dedicated to financial education and understanding. Check out "valuation" topics in Stocks and Bonds sections.
  http://www.finpipe.com/
• Fool.com: Dividend Discount Model (DDM). Nice article, courtesy of The Motley Fool, addresses two of the more basic forms of the DDM -- the stable model and the two-stage model.
  http://www.fool.com/research/2000/features000406.htm
• Getting Started With Excel. Excellent set of Excel spreadsheet tutorials courtesy of Dr. Sharon Garrison. NOTE: Excel spreadsheets can be used to solve a wide variety of time-value-of-money (and other valuation-type) problems.
  http://www.studyfinance.com/lessons/excel/index.mv
• Globeinvestor.com. Stocks, investing and financial news from a Canadian perspective.
  http://www.globeinvestor.com/
• Guidebook -- TI BAII Plus Calculator. Guidebooks available in English, Chinese, and Spanish.
  http://education.ti.com/educationportal/appsdelivery/download/download_eula.jsp?applicationId=6114&contentPaneId=19&cid=US
• Homepage of Professor William F. Sharpe. Links to the work of the Nobel laureate who developed the capital-asset pricing model (CAPM) -- e.g., learn about The Sharpe Ratio.
  http://www.stanford.edu/~wfsharpe/
• How to Value Stocks. A whole series of articles relating to common stock valuation from the folks at The Motley Fool.
  http://www.fool.com/School/HowtoValueStocks.htm
• Individual Investors -- Education. Morgan Stanley site has links to excellent tutorials prepared by The Wall Street Journal -- e.g., click on the various sub-topics found at Investing, Bonds, and Stocks.
  http://www.morganstanleyindividual.com/education/
• Interactive Tutorials. Interactive tutorials related to quantitative aspects of financial management (e.g., time value of money, bond valuation, and CAPM). Note: Makes use of Java Applets and Javascript.
  http://web.njit.edu/~mathis/interactive/index.html
• Interest Factor Tables. FVIF, PVIF, FVIFA, and PVIFA tables. Note: You will have to download an Adobe Acrobat PDF file.
  ftp://ftp.prenhall.com/pub/be/finance.d-006/wachowicz/fundamentals/PDF.graphs/vhapp.pdf
• "An Introduction to Investment Theory". Excellent online textbook by Prof. William Goetzmann introduces the foundations of portfolio theory -- risk versus return, CAPM, beta, SML, APT, and more.
  http://viking.som.yale.edu/will/finman540/classnotes/notes.html
• Investing for Your Future. A neat FREE, eleven-part, home study course developed by the Rutgers Cooperative Extension system for beginning investors. See, for example, Unit 2: Investing Basics.
  http://www.investing.rutgers.edu/
• Investing-in-Bonds.Com. Bond basics and more.
  http://www.investinginbonds.com/
• Investment Advisor Magazine. Some heavy-duty content on investment theory and practice.
  http://www.investmentadvisor.com/
• Investopedia.com: Tutorials and Lessons. Check out Stock Basics, Bond and Debt Basics, and Risk and Diversification in particular.
  http://www.investopedia.com/university/
• Investor Education and Assistance. The SEC's Office of Investor Education and Assistance provides a variety of services to address the problems and questions you may face as an investor.
  http://www.sec.gov/investor.shtml
• Investor Home. Extensive collection of investment information and links.
  http://www.investorhome.com/
• InvestorGuide.com -- University. Has financial concepts grouped into sections for an easy and efficient way to learn about finance -- try out their "Investing Basics," "Stocks," and "Bonds" sections.
  http://www.investorguide.com/university.html
• The Investor's Clearinghouse. Investing basics and more from the Alliance for Investor Education.
  http://www.investoreducation.org/
• Journal of Indexes. Articles, news, stats, and more -- a very informative, and interesting, site.
  http://www.journalofindexes.com/
• Learn About Index Funds. Learn about index funds and the concept of indexing.
  http://www.indexfunds.com/learn.htm
• Linear Interpolation Equation Formula Calculator. Sometimes we are forced to use trial-and-error plus interpolation to find the approximate Yield to Maturity (YTM) on a bond. This online calculator helps you with the interpolation.
  http://www.ajdesigner.com/phpinterpolation/linear_interpolation_equation.php
• Major Rating Agencies. Links to major rating agencies and long-term bond rating definitions.
  http://www.bondsonline.com/docs/research-ratings.html
• Microsoft's Money Central Investor. Centerpiece of the site is a free portfolio manager. You can manage and track multiple portfolios representing either "real" or "play" money investments.
  http://moneycentral.msn.com/investor/home.asp
• MoneyChimp: Investor Education and Financial Calculators. Articles and interactive features that explain finance and investment. (Formerly, DataChimp.)
  http://www.moneychimp.com/
• Mortgage / Bond Calculator. Calculator determines the present value for mortgages, pure discount bonds, and coupon bonds. It will also calculate the rate of return (or bond yield-to-maturity) that makes the present value equal to a known market price for the security. It will also build an amortization table for you.
  http://www.econmodel.com/classic/calculators/pv1.php
• Mortgage Loan Calculator. Use this calculator (courtesy of KJE Computer Solutions) to generate an amortization schedule for a mortgage. Quickly see how much interest you will pay, and your principal balances.
  http://www.dinkytown.com/java/MortgageLoan.html
• The Motley Fool. Wonderful online investment education site, whose mission is to "To educate, amuse and enrich" -- and they do!
  http://www.fool.com/
• Mutual Fund Advisor. Articles on mutual funds, a glossary of mutual fund terms, listed mutual funds by family and information about them, news, historical facts and more.
  http://www.mutual-funds-advisor.com/
• NASD - Investor Information - Smart Bond Investing. A wealth of information about bond basics including the risks.
  http://apps.nasd.com/investor_Information/smart/bonds/000100.asp
• NASD Bond Search. Transaction information on corporate bonds as reported to NASD TRACE (Trade Reporting and Compliance Engine). In addition, contains basic descriptive information and credit ratings on individual corporate bonds.
  http://www.nasdbondinfo.com/
• NASDAQ: U.S. Economic Calendar. Highlights daily economic events and provides analysis thereby helping you interpret economic news and relate to market movements.
  http://www.nasdaq.com/asp/EconodayFrame.asp
• NYSE MarkeTrac. Access stock quotes, price charts, news and other market data (including a stock's beta).
  http://marketrac.nyse.com/
• Path to Investing. Objective investor education, essential resources, and expert insights from the Foundation for Investor Education.
  http://www.siainvestor.com/
• Predict Wall Street -- The Stock Market Prediction Community. Provides continually updated forecasts of stock prices based on the collective wisdom of its users. Since the stock market moves based on the collective thinking of thousands of individuals, the more people who predict on PredictWallStreet.com, the more potentially useful the information on the site becomes.
  http://www.predictwallstreet.com/
• Price Check Calculator. Helps you estimate a fair price to pay for a stock based on three main things: the company's earnings, the rate at which those earnings are projected to grow, and the stock's volatility. You can also tweak the variables to see how the valuation might change.
  http://www.smartmoney.com/pricecheck/
• Quote.com. FREE worldwide quotes, charts, and news covering all major financial markets.
  http://www.quote.com/
• Reuters Investor. A rich source of financial information. Enter a company name (or ticker symbol) for a "Stock Overview" and click on "Go." Under "Figures At-A-Glance" you will find an estimate of a company's beta. A host of other information is available with free registration. (Fomerly, MultexInvestor and before that MarketGuide).
  http://www.investor.reuters.com/
• RiskGrades. A tool for assessing the risk of a financial asset or portfolio from RiskMetrics, a privately-held spin-off of J.P. Morgan.
  http://www.riskgrades.com/
• Schwab.com/Chinese. U.S. securities news and research -- at schwab.com -- all in Chinese.
  http://schwab.com/chinese
• SIA Investor. The Securities Industry Association's excellent online educational resource for individual investors.
  http://www.siainvestor.org/
• SmartMoney University: Investing 101. Nice set of tutorials covering the basics of investing.
  http://university.smartmoney.com/Departments/Investing101/
• S&P Index Services. Information about the S&P 500, MidCap, and SmallCap Indexes.
  http://online.rimes.com/spgi/spgi6.wsx?SP500
• Statistical Analysis Web Sites
  1. Against All Odds: Inside Statistics. A video instructional series on statistics for college and high school classrooms and adult learners; 26 half-hour video programs and coordinated books. Users will need to sign up to view each program, but this process is offered at no charge.
     http://www.learner.org/resources/series65.html
  2. Correlation and Regression Calculator. Type/paste in two sets of numbers and the calculator returns means, variances, regression coefficients, covariance, correlation coefficient, plus a scatterplot with two regression lines (i.e.,X on Y, and Y on X). (TIP: Use to calculate a common stock beta -- i.e., the slope of the characteristic line.)
     http://calculators.stat.ucla.edu/correlation.php
  3. Exploring Data. Great statistics learning site for both students and teachers.
     http://exploringdata.cqu.edu.au/
  4. Statistics at Square One. Statistics at Square One "was one of the best selling statistical text books in the UK." It has been revised for this online edition. It was written from a medical statistics perspective, thus many of the examples involve health related topics. However, the book can be used by anyone to learn the fundamentals of statistics.
     http://www.bmj.com/collections/statsbk/
  5. Statistics Every Writer Should Know. Described in plain English, are some basic concepts in statistics that every writer (and finance student) should know.
     http://www.robertniles.com/stats/
  6. The Statistics Homepage. Really cool Electronic Statistics Textbook offering training in the understanding and application of statistics courtesy of StatSoft, Inc.
     http://www.statsoft.com/textbook/stathome.html
  7. VassarStats: Linear Correlation and Regression. Nice interactive site that performs correlation and regression calculations courtesy of VassarStats.
     http://faculty.vassar.edu/lowry/corr_stats.html
  8. Web Interface for Statistics Education (WISE). Contains interactive statistics tutorials and links to databases, on-line statistics journals and discussion groups, and links to other sites dedicated to statistics.
     http://wise.cgu.edu/
  9. Web Pages that Perform Statistical Calculations. Links to a cornucopia of sites that do interactive statistical calculations -- e.g., regression analysis.
     http://statpages.org/
  10. Z-Score and Normal Distribution Java Applets. Links to Java applets useful for finding probabilities related to normal distributions.
      http://psych.colorado.edu/~mcclella/java/zcalc.html
• Stock Market Yellow Pages. Lets you search for public companies by their descriptions.
  http://www.stockmarketyellowpages.com/
• Stock Maven. Stock research center -- real time quotes and news, live financial markets data, research tools to evaluate and track stocks of publicly held companies.
  http://www.stockmaven.com/
• StockWizard. Investment-related search engine form i-Soft, Inc. that allows users to locate free information on U.S. publicly traded companies.
  http://www.stockwizard.com
• studyfinance.com. Visit this site's Overviews (Tutorials) related to Valuation: Time Value of Money and Valuation of Corporate Securities.
  http://www.studyfinance.com/
• Superstar Investor. Comprehensive collection of securities investment-related links.
  http://www.superstarinvestor.com/
• Time Value of Money Web Sites
  1. Annuities: Ordinary? Due? What do I do?. Tutorial (with quiz) to help you better identify, understand, and calculate future and present values of both ordinary annuities and annuities due.
     http://web.utk.edu/~jwachowi/annuity1.html
  2. Annuity Problems. Practice time-value-of-money annuity problems with answers and detailed solutions.
     http://web.utk.edu/~jwachowi/annuity_prob.pdf
  3. Anything but Ordinary: Calculating the Present and Future Value of Annuities. Nice article courtesy of Investopedia.com.
     http://www.investopedia.com/articles/03/101503.asp
  4. Continuously Compounded Interest Formula and Calculator. Courtesy of MoneyChimp.com.
     http://www.moneychimp.com/articles/finworks/continuous_compounding.htm
  5. Excel: Time Value of Money, Discounting, & Capital Project Analysis.
     http://fpmdi.cfans.umn.edu/bp4504-5504/Assignments/Excel_timevalue.pdf
  6. "Growing Annuities". Article explains how to determine the future/present value of a growing annuity (i.e., an annuity in which the payments/receipts increase each period at a constant percentage).
     http://web.utk.edu/~jwachowi/growing_annuity.pdf
  7. Interactive Tutorials. Interactive tutorials related to quantitative aspects of financial management (e.g., time value of money, bond valuation, and CAPM). Note: Makes use of Java Applets and Javascript.
     http://web.njit.edu/~mathis/interactive/index.html
  8. Rule of 72 (with calculator). Get "doubling your money" exact answers plus "Rule of 72" estimates courtesy of MoneyChimp.com.
     http://www.moneychimp.com/features/rule72.htm
  9. studyfinance.com. Visit this site's Overviews (Tutorials) related to Valuation: Time Value of Money and Valuation of Corporate Securities.
     http://www.studyfinance.com/
  10. TI BA II Plus™ Professional Calculator Tutorials. Free, interactive online "movie" tutorials designed to help students learn the BA II Plus Professional's features.
      http://www.atomiclearning.com/ti_ba2
  11. Time Value of Money (Tutorial). PowerPoint tutorial courtesy of University of Tennessee's Suzan Murphy -- gives special attention to using the HP 17B II calculator to solve problems.
      http://itc.utk.edu/spotlight/archive/murphy/MBA_Prep_Summer_Tech.ppt
  12. The Time Value of Money (TVOM) Tutorial. This extensive tutorial reviews the basic 'Time Value of Money' (TVOM) or 'interest rate' formulas and concepts.
      http://www.frickcpa.com/tvom/default.asp
  13. Time Value of Money Tutorial. Nice coverage of TVM basics courtesy of Teresa P. Gordon, Professor of Accounting at the University of Idaho.
      http://www.cbe.uidaho.edu/Acct415/Course%20Materials/Lecture%20Slides%20(PPT)/ Time%20Value%20of%20Money.ppt
• Using your financial calculator for financial calculations. Professor Michael Kinsman provides explanations of your calculator's financial functions (covers HP-12c, HP10B, HP17B II, and TI BA II).
  http://luna.pepperdine.edu/faculty/mkinsman/Calculators/Using.html
• ValuationResources.Com. Business valuation resources including links to valuation publications, industry resources, economic data, public company information, mergers and acquisitions data, etc. -- some of the data providers linked to require a fee, but many do not.
  http://valuationresources.com
• ValuePro Stock Value Calculator. Gives a baseline valuation for publicly traded common stocks. Just enter the stock's ticker symbol. Users may also change any of the inputs and revalue.
  http://www.valuepro.net/index.shtml
• Value Quotes. Quotes on personal and business value.
  http://www.valuequotes.net/
• "What is Market Efficiency?" Nice article explaining the concept of "market efficiency" courtesy of Investopedia.com.
  http://www.investopedia.com/articles/02/101502.asp
• Yahoo! Bond Center. General information about bonds, a glossary, the latest bond news, and a message board.
  http://bonds.yahoo.com/
• Yield to Maturity Calculator. Will help you to determine the "annualized" (nominal annual) YTM of a bond that pays interest semiannually. This "annualized" YTM is found by first determining the semiannual YTM, and then doubling that figure. This is exactly what bond traders do in calculating a YTM.
  http://www.investopedia.com/calculator/AOYTM.aspx
• Zacks Investment Research. Find company information using their pull-down menu with company ticker symbol. Requesting a "PDF Snapshot" will get you a company's beta too.
  http://www.zacks.com/

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