Chapter 01 - Investments: Background and Issues Essentials of Investments 12th Edition Bodie Solution Manual Congratulations! You have thoughtfully selected Essentials of Investments by Bodie, Kane, and Marcus, the superlative textbook for undergraduate finance. Welcome to the Instructor’s Manual (IM) for the twelfth edition. Its purpose is to help you, the instructor, build an effective approach for preparing students for a career in the investment industry. Though written primarily for newer instructors, veteran professors may benefit by seeing the evolution of the text as we ll as learning about the new resources offered by Essentials of Investments . McGraw -Hill and the authors are committed to providing up to date information and cutting - edge pedagogical advancements. Recent times have been instructive on the need for versatile and nimble education, with an emphasis on the ability to adapt to a variety of scholastic challenges. Adaptability must never come at the cost of the rigor that h as made Essentials of Investments (and its graduate level counterpart, Investments ) an essential tome for modern practitioners. This edition retains that level of quality while adding several new technology - driven features on our Connect online learning p latform. The three major additions to the Essentials of Investment battery of learnings tools are Digital Faculty Consultants, Integrated Excel, and Application Based Activities; all discussed below. The IM makes extensive reference to the companion PowerPoint (PPT) files. In the PPT, we have chosen to provide high-level information while streamlining many of the slides. This promotes a more seamless quality in presentation delivery and does not over -crowd each slide, a complaint consistently present in student feedback. We have added additional examples to aid in concept digestion. Every chapter has been updated to reflect developments and changes in the field of finance. All data have been updated an d sections added that cover new information on topics such as the roots of the financial crisis of 2008, the fallout from the crisis; changes to the hedge fund industry and the rise of financial technology (fintech). Many students request a study guide to prepare for examinations. Saving the PPT as a PDF in the “Outline” view is an easy way to accommodate student demand while maintaining the integrity of the content. You may also wish to consider printing the slide view of the PPT as a PDF and posting th e electronic file online for student review. Nicholas Racculia, PhD Introduction to the Instructor’s Chapter 01 - Investments: Background and Issues McGraw -Hill Integrated Professor of Finance McKenna School of Business, Economics and Government Saint Vincent College The chapters in Essentials of Investments could form the basis of several different courses. For example, Parts One (Elements of Investments), Three (Debt Securities), and Four (Investments Securities) can be combined to an excellent Introduction to Investments Course. Adding to that Part Five (Derivative Markets) and Chapter 18 (Evaluating Investment Performance) creates a robust two semester sequence on Investments. An excellent Portfolio Theory course can be built from Parts Two (Portfolio Theory) and Six (Active Investment Management). Students preparing to sit for the Chartered Financial Analysis exam can use the entire textbook as a resource or study guide. With so many options, McGraw Hill recognizes that course construction can seem daunting. To assist you, Digital Faculty Consultants (DFC) are available to help design the course and fill out i ts content. DFCs are dedicated instructors who are passionate about the effectiveness of Essentials of Investments. They can help you anticipate and overcome many of the pitfalls that emerge when teaching this challenging material. They can assist you by h osting one -on-one or group webinars and many have experience presenting at pedagogical conferences and workshops. They also can connect directly with you by phone and email. They act as liaisons to the McGraw Hill technology team to develop innovative and continually evolving digital content which can be shaped by your feedback. If you are new instructor, or are looking for some feedback on the current structure of your course, please consider connec ting with a McGraw Hill Digital Faculty Consultant: www.mheducation.com/highered/explore/digital -faculty - consultants.html Connect is a course manag ement and adaptive learning solution. It provides a useful learning platform that enhances your unique voice and teaching style. It houses the eBook version of Essentials of Investments, its PowerPoint Presentations, student Excel templates, and Smartbook 2.0. In addition, it is filled with content including a robust Test Bank, algorithmic problems to further challenge students, media on a variety of topics, and a test building function. It will also feature two new learning tools, Integrated Excel and Application Based Assignments, both debuting fall of 2021. Visit Connect at: www.mheducation.com/highered/connect Course Design and Digital Faculty Chapter 01 - Investments: Background and Issues Application Based Integrated Excel is a web -based, self -contained application that is built directly into Connect. Instructors will not need to upload or download any files. Student will be solving problems di - rectly on the browser. The instructor sets grading options - correct answer or a correct formula. This latter option requires students to learn Excel functionality, a skill in high demand among employers. There are currently more than 125 Excel formulae accepted by Integrated Excel, with more being added monthly. Integrated Excel com es prebuilt with several questions per chapter, but as instructor, you will have the option of building your own questions. Integrated Excel will be ready fall of 2021. Application Based Activities (ABA) are another new Connect feature introduced with Essentials of Investments, 12ed. They allow students to be immersed in interactive problem -solving. ABAs provide students valuable practice using problem -solving skills to a pply their knowledge to real - istic scenarios. Students progress from understanding basic concepts to more complex problems of increased sophistication. A built -in hint feature will allow progressively stronger hints to be displayed each time a wrong answe r is entered. Like Integrated Excel and all the other tools on Connect, you can grade these or use these as practice. Many of the ABA questions will be algo - rithmic. ABA will also be ready for use by fall of 2021. Chapter 01 - Investments: Background and Issues The first part of the text builds the foundational groundwork for the investment process with easy to access chapters on asset classes, financial instruments, securities mark ets, trading mechanisms and investment vehicles such as mutual funds. These first four chapters are presented in a nontechnical manner. They make it possible for instructors to assign term projects analyzing securities early in the course. Chapter 1: Inve stments: Background and Issues – Basic overview of the investment landscape. Includes sections on securitization, the rise of fintech, the roots of the financial crisis, and the fallout from the crisis. Chapter 2: Asset Classes and Financial Instruments – Presents the major asset classes and the financial instruments within each class. Chapter 3: Securities Markets: Introduces the types of markets, basic security trading (limit orders and market orders), as well as buying on margin and short sales. Extensive coverage of the rise of electronic markets, algorithmic and high-speed trading, and changes in market structure. Chapter 4: Mutual Funds and Other Investment Companies – Introduces pooled inv estment strategies such as mutual funds, their fee structure, and their performance. Includes coverage of innovations in exchange -traded funds. Part One: Elements of
