第三部分 问题清单2——金融专业知识1.金融：资源的跨期调配2.定价的

The third part of the list of issues 2-financial expertise <br>1. Finance: inter-temporal allocation of resources <br>2. Two ways of pricing: <br>(1) equilibrium pricing (absolute pricing) ---determined by both supply and demand --- behavioral finance (Psychology) For <br>example, mean variance analysis, CAPM <br>(2) No-arbitrage pricing (relative pricing) --- based on the price of some basic assets to price other assets such as derivatives, such as BSM model <br>3. Internet finance Where financial banks cannot be replaced, financial friction: information asymmetry; maturity mismatch <br>4. Good asset prices are high but expected returns are low (low risk), bad asset prices are low but expected returns are high <br>5. Efficient market theory: Chicago School Fama; Invalid Market Theory: Shiller <br>6. Two core contents of behavioral finance: irrationality, limited arbitrage <br>7. Bond yield to yield (Yield to maturity) is actually IRR (reinvestment risk also exists), pay P in period 0 , Face value is received at maturity, coupon is received in each period (similar to interest in each period), but pay attention to the period, IRR of bonds with different periods is not comparable, and the IRR of bonds is related to market interest rates, because P is caused by ( <br>The pricing of bonds determined by FC and market interest rates is discounted by cash flow, using the spot discount rate of each period (not equal to YTM, such as the fifth period, which is a five-year mature non-interest-bearing bond The annualized rate of return, through the existing pricing bonds to get the spot interest rate of each period, bootstrap methods), the forward interest rate is the predicted <br>duration of the future X period interest rate at a future point in time (future cash The longer the average recovery time), the more sensitive it is to changes in interest rates, that is, the greater the price change of bonds, so it is expected that future interest rates will increase and the duration will increase, the bond price will rise more; the interest rate will decrease, shorten the duration, and the bond price will decrease more. Less <br>8. Stock pricing is determined by future payoff (uncertain) and discount rate (determined by CAPM)<br>DDM---Dividend discount model (need to predict future dividend and discount rate)---simplified to get Gordon model (g dividend growth rate), why the discount rate r>g, from a mathematical point of view, otherwise sum The number sequence does not converge. The financial logic behind is: <br>g is actually the average number of future dividend growth rates, because there are fluctuations and risks in the dividend growth rate, and r is the return on investment of the stock required by the investor, so r should be greater than g Compensate for the risk of future dividend growth rate fluctuations (volatility)

Part III List 2 - Financial Expertise<br>1. Finance: cross-term allocation of resources<br>2. Pricing is based in two ways:<br>(1) Balanced pricing (absolute pricing) --- is determined by both supply and demand--- Behavioral Finance (Psychology)<br>For example, mean variance analysis, CAPM <br>(2) No arbitrage pricing (relative pricing) --- pricing other assets such as derivatives by the price of some of the existing base assets, such as BSM model<br>3. Internet finance can't replace commercial banks, financial friction: information asymmetry;<br>4. Good asset prices are high but the expected yield is low (low risk), bad asset prices are low but the expected yield is high<br>5. Effective Market Theory: Chicago School Fama;<br>6. Two core contents of behavioral finance: irrational, limited arbitrage<br>7. The yield on maturity of the bond (Yield to maturity) is actually IRR (there is also a risk of reinvestment), 0 pay P, maturity receives face coupon, receives each period of interest (similar to interest per period), but pay attention to the term, different maturities of the bond to calculate the IRR is not good ratio, and the bond's IRR and market interest rate, because P is determined by (FC and market interest rates)<br>Bond pricing in cash flow discount, to use the current discount rate of each period (not equal to YTM, such as the fifth period, is a five-year mature half-way interest-paying bond annualized yield, through the existing pricing bonds to get the spot rate of each period, bootstrap s, forward interest rate is standing at the future point of the forecast of the future X-term interest rate<br>The longer the duration (the average recovery time for future cash flows), the more sensitive it is to changes in interest rates, i.e. the greater the change in bond prices, so expect future interest rates to rise, pull long term, bond prices rise more;<br>8. The pricing of stocks is determined by future payoff (uncertain) and discount rate (determined by CAPM)<br>DDM --- dividend discount model (which needs to predict future dividends and discount rates) --- simplified to get the Gordon model (g dividend growth rate), why the discount rate r?g, from a mathematical point of view, otherwise, the sum of the series does not converge, the financial logic behind it is:<br>g is actually the average of future dividend growth rates, because of the volatility and risk of dividend growth, and r is the return on investment of the stock demanded by the investor, so r to g to compensate for the risk of future dividend growth (volatility)

Part 3 list of questions 2 - financial expertise<br>1. Finance: cross period allocation of resources<br>2. Two ways of Pricing:<br>(1) Equilibrium pricing (absolute pricing) -- determined by both supply and demand --- Behavioral Finance (Psychology)<br>For example, mean variance analysis, CAPM<br>(2) No arbitrage pricing (relative pricing) - pricing other assets such as derivatives, such as BSM model, based on the price of some existing basic assets<br>3. Where Internet finance can't replace commercial banks, financial Frictions: information asymmetry; term mismatch<br>4. The price of good assets is high but the expected rate of return is low (risk is small), and the price of bad assets is low but the expected rate of return is high<br>5. Efficient market theory: Chicago School Fama; invalid Market Theory: Shiller<br>6. Two core contents of Behavioral Finance: irrational and limited arbitrage<br>7. The yield to maturity of a bond is actually IRR (there is also a risk of reinvestment). If you pay P at maturity, you will receive face value at maturity, and you will receive coupon (similar to the interest of each issue). However, we should pay attention to the maturity. The IRR of bonds with different maturities is different from that of bonds with different maturities. Moreover, the IRR of bonds is related to the market interest rate, because P is determined by (FC and market interest rate)<br>When the bonds are priced with cash flow, the spot discount rate of each issue should be used (not equal to YTM, for example, the fifth period is the annualized yield of a five-year mature bond with no interest payment, and the spot interest rate of each issue can be obtained through the existing pricing bonds. The forward interest rate is the prediction of the future X-period interest rate standing at the future time point<br>The longer the duration (the average recovery time of future cash flow) is, the more sensitive it is to the change of interest rate, that is, the greater the change of bond price is, so the expected future interest rate will increase, and if the duration is prolonged, the bond price will rise more; if the interest rate decreases and the duration is shortened, the bond price will decrease less<br>8. The pricing of the stock is determined by future payoff (uncertain) and discount rate (determined by CAPM)<br>DDM -- dividend discount model (need to predict the future dividend and discount rate) -- after simplification, Gordon model (g dividend growth rate) is obtained. Why is the discount rate r > G? From a mathematical point of view, otherwise, the sum sequence does not converge. The financial logic behind this is:<br>In fact, G is the average of the future dividend growth rate, because there are fluctuations and risks in the dividend growth rate, and R is the investment return rate required by investors. Therefore, R should be greater than g to compensate for the risk of volatility of future dividend growth rate