Financial Investment Analysis Essay Example | Topics and Well Written Essays - 1250 words

Financial Investment Analysis - Essay Example This, particularly, must be challenging for companies with global operations that may have their cash balances fragmented across different geographies, banks, and bank accounts which make accessing cash difficult (Huang 2003). In this regard, this paper seeks to address the issue of efficient diversification as a comprehensive strategy in liquidity and stock return. Liquidity of an asset explains the ease with which an asset can be sold after its purchase without incurring further losses and how risks can be mitigated if not minimized (Baker 2006). The various losses that could be incurred may be due to the various transaction costs or price changes or poor investment strategies. Thus the main aim of this study shall be to examine how proportionate efficient diversification increases the neutralization of low pricing and promising high returns (Elton et al. 2007). The paper holds that efficient diversification must there is a potential benefit when risky part of portfolio consists of weighted proportions of all possible risky assets. Naive and Efficient Diversification Studies done on investment on stock markets and equity securities have documented the relationship that exists in weighted portfolios (proportionate or otherwise on risky assets). Broadly speaking, there two causes of uncertainty. Elton et al (2007) note that one of them is risk which relates to broad economic conditions. These include inflation, currency exchange rates, interest rates and business cycle. Interestingly, these macro-economic aggregates cannot be foreseen with implicit surety, yet they impact on the rate of returns. Second, according to them, is a firm-specific influence which affects the organization without obviously affecting other companies (Elton et al. 2007). These include effects such as managerial structure, human resource changes and research and development (Baker 2006). Obviously when diversification is naively done, for instance adding additional security to a risky por tfolio, then this should work to lessen portfolio risk. The implication here is that continued diversification into even other securities more and more decreases the probability of exposition to the specific risk factors of the company, thereby ensuring the falling of portfolio volatility (Jagannathan and Wang 2006). All this happens when it is naive diversification where equally weighted portfolio of many securities is employed (Elton et al 2007). Inherently, if risks are only firm’s specific means, diversification still reduces the risk to reasonable low levels (Baker 2006).This means that when it comes to a situation where the sources of risks are autonomous and there is spreading of investment into numerous securities, there is negligibility of exposure to specific font of risk. This is what is sometimes referred to the insurance principle (Jagannathan and Wang 2006). Regardless of this however, the tragedy is that in a situation where common risk foundations have impact on all companies, even widespread diversifying fails to eradicate risk. At this, portfolio standard deviation reduces when securities numbers increases. Despite this, it is never reduced to zero, and thus there must be a market risk/systematic risk, which is attributed to market forces (Jagannathan and Wang 1996). Else how, efficient diversification is often done when weighted portfolios are employed proportionately.

E-Commerce Law Essay Example | Topics and Well Written Essays - 1500 words - 2

E-Commerce Law - Essay Example It should be noted that everybody values their privacy very much and the effort to disturb privacy is prevented by different laws in different countries. Spam or bulk emails sent as part of marketing without taking the consent of the public is definitely a privacy intrusion. Many countries already started efforts to regulate spam by implementing suitable laws. European Union has recently implemented comprehensive laws to regulate spam. The EU Directive 2002/58/EC on the protection of privacy in the electronic communications sector deals with direct marketing via email and other electronic means. The Directive requires prior consent before email is sent to the recipient unless there is already an ongoing relationship with the consumer. The Directive does not apply to legal persons however; Member states are free to extend the legislation to cover legal persons (Please provide proper citation). Advertising is an essential activity in the business world. No product or services can be effectively sold in the market without proper advertising. In other words, advertising is the basic right of the product manufacturers and service providers. At the same time, consumers or general public also have some basic rights. Privacy is a basic right of the ordinary people. Advertisers can conduct advertising activities as long as they stay away for violating the privacy rights of the ordinary people. In short, spam or bulk emails sent to the public without taking consent can be considered as illegal because of privacy violation. According to the spam regulation laws in UK, electronic mail marketing messages should not be sent to individuals without their permission. Both the sender and the recipient should agree each other for sending and receiving bulk emails. UK laws with respect to spam have lot of loopholes. It allows senders to send marketing mails to an existing customer. In other