General Finance
The number of sectors in the S&P 500
What is 11?
The three financial statements
What are Income Statement, Balance Sheet, and Cash Flow Statement
The accounting formula
What is Assets = Equity + Liabilities
What the Federal Reserve has been doing to interest rates
What is raising
The term used for the practice of spreading investments over different assets to reduce risk
What is Diversification?
The CAPM formula and what it represents
What is a formula that calculates the expected rate of return for an asset or investment.
What is Rf + Beta (Rm-Rf)
Where Depreciation usually shows up on the Income Statement
What is separate line item, COGS, or Operating Expenses
The company with a larger beta between Waste Management and Tesla
What is Tesla
A bank that failed in 2023
Signature Bank
Silicon Valley Bank
First Republic Bank
The description of Top-Down Analysis
Top-down analysis begins at the macro level, looking at things like national economic data (e.g., GDP or unemployment) and then homing in on more micro variables.
3 valuation methods
What are:
Public Comps (CCA)
PE x EPS
DCF
DDM
LBO
3 major line items on each of the financial statements.
Income Statement: Revenue; Cost of Goods Sold; SG&A (Selling, General & Administrative Expenses); Operating Income; Pretax Income; Net Income
Balance Sheet: Cash; Accounts Receivable; Inventory; Plants, Property & Equipment (PP&E); Accounts Payable; Accrued Expenses; Debt; Shareholders’ Equity.
Cash Flow: Net Income; Depreciation & Amortization; Stock-Based Compensation; Changes in Operating Assets & Liabilities; Cash Flow From Operations; Capital Expenditures; Cash Flow From Investing; Sale/Purchase of Securities; Dividends Issued; Cash Flow From Financing.
The stock with the largest market cap
What is AAPL?
The most recent Federal rate decision
What is hold
The typical diversification percentage between stocks and bonds for a portfolio of a 30 year-old
What is 70% Equity, 30% Fixed Income
What is 70% Equity, 20% Fixed Income 10% Cash
The definition of Beta and the Beta of the market
What is 1?
The one statement most needed to understand the overall health of a company.
What is the Cash Flow Statement?
Gives a true picture of how much cash the company is actually generating, independent of all the non-cash expenses you might have.
The formula for Enterprise Value
Equity Value + Net Debt (Easy)
The frequency of CPI data releases
What is Monthly
The dollar amount gifted to our RFP Portfolio last year
What is $33,000?
The WACC formula
What is Cost of Equity * (Weight (%) of Equity) + Cost of Debt * (Weight (%) of Debt) * (1 – Tax Rate)
The changes in each financial statement when Inventory goes up by $10, assuming it is paid with cash
What is
IS: none
CF: - $10 CF from Operations = -$10 net cash
BS: Inv +$10, Cash -$10
No changes to the Income Statement. On the Cash Flow Statement, Inventory purchase decreases your Cash Flow by $10, and the Net Change in Cash at the bottom. On the Balance Sheet, Inventory is up by $10 but Cash is down by $10
The definition of goodwill
What is the dollar amount over the fair value of an acquired companies net assets paid for in an acquisition
The risk-free rate now and what it represents
the 3 month T bill and is around 5.32%
The three-month U.S. Treasury bill is a useful proxy for the RFR because the market considers there to be virtually no chance of the U.S. government defaulting on its obligations.
Out of these stocks, which one isn't in the HFG Portfolio: Waste Management, Alibaba, Adobe, Humana, Chipotle, Costco
Alibaba