DATA COLLECTION II

INTRODUCTION
All students should integrate at least 2 from 4 of the topics studied in the field of finance that are
related to: 1) stock markets, 2) international finance, 3) monetary theories, and 4) public finance and
fiscal policy courses.
It is the responsibility of each student to select which topics to integrate and once the courses (topics)
are selected, they cannot be changed.
A spread sheet using Excel can be used to present and to calculate averages, ratios, and other needed
statistical measures.
1) STOCK MARKETS
In this section, students should compare between different stock and bond markets. The expected
include US, Europe, Asia among other countries or regions.
US MARKETS (NYSE, NASDAQ, S&P 500, DOW JONES)
Identify the main indexes of the US stock and bond markets. Use at least one index to integrate
and compare between the risk and performance of the risk and each company selected.
When we look up the US Stock Markets we find the New York Stock Exchange (NYSE),
National Association of Securities Dealers Automated Quotations (NASDAQ), Standard &
Poor's 500 (S&P 500), and the Dow Jones.
Merck
Merck & Inc. is expected to generate 2.0 times less return on investment than the market. In
addition to that, the company is 1.77 times more volatile that its market benchmark. It trades
about 0.1 of its total potential return per unit of risk. Also is generating 0.1% of daily returns
assuming volatility of 0.99% on return distribution over 30 days investment horizon. In other
words, 15 % of equities are less volatile than the company and above 93% of equities are
expected to generate higher returns over the next 30 days. It rated below average in return on
equity category among related companies. It is regarded fifth in EBITDA category related
companies totaling about 1,494,117,647 of EBITDA per ROE.
Abbott
Abbott Laboratories is generating 0.17% of daily returns assuming volatility of 0.8% on return
distribution over 30 days investment horizon. In other words, 12% of equities are less volatile
than the company and above 88% of equities are expected to generate higher returns over the
next 30 days. Considering 30-days investment horizon, Abbott Laboratories is expected to
generate 1.36 times more return on investment than the market. However, the company is 1.36
times more volatile than its market benchmark. It trades about 0.21 of its potential returns per
unit of risk. The S&P 500 is currently generating roughly 0.27 per unit of risk. Considering 30-
days investment horizon, the stock has beta coefficient of 1.02. This suggests Abbott
Laboratories market returns are very sensitive to returns on the market.
Pfizer
Pfizer Inc. is generating 0.21% of daily returns assuming volatility of 0.83% on return
distribution over 30 days investment horizon. In other words, 13% of equities are less volatile
than the company and above 85% of equities are expected to generate higher returns over the
next 30 days. Considering 30-days investment horizon, Pfizer Inc. is expected to generate 1.41
times more return on investment than the market. However, the company is 1.41 times more
volatile than its market benchmark. It trades about 0.25 of its potential returns per unit of risk.
The S&P 500 is currently generating roughly 0.27 per unit of risk. Pfizer has beta of 0.96. This
implies that Pfizer market returns are very sensitive to returns on the market.
GlasoSmithKline
GlaxoSmithKline is generating 0.16% of daily returns assuming volatility of 0.71% on return
distribution, 11% are less volatile than the company and above of 88% of equities are expected
to generate returns. Considering investment horizon, GSK is expected to generate returns equally
to market. However the company is 1.2 more volatile than the market benchmark. It trades about
0.23 of its potential returns per unit of risk. The S&P is currently generating 0.27 per unit of risk.
GSK has a beta of 0.46, this indicates as returns on market go up. Also average returns are
expected to increase less than the benchmark.
Bristol-Myers Squibb
Bristol-Myers Squibb Company is generating 0.06% of daily returns assuming volatility of 0.61% on
return distribution over 30 days investment horizon. In other words, 9% of equities are less volatile than
the company and above 96% of equities are expected to generate higher returns over the next 30 days.
Considering 30-days investment horizon, BristolMyers Squibb Company is expected to generate 2.67
times less return on investment than the market. In addition to that, the company is 1.03 times more
volatile than its market benchmark. It trades about 0.1 of its total potential returns per unit of risk. The
S&P 500 is currently generating roughly 0.27 per unit of volatility. BristolMyers has beta of 0.65 . This
suggests as returns on market go up, BristolMyers avarage returns are expected to increase less than
the benchmark.



EUROPEAN MARKETS (FTSE100, Euronext100, CAC40, DAX, Swiss Market Index)
Identify at least three European Stock Markets and compare between them and the US stock market.
FSTE 100 - The FSTE 100 Index is a share index of the 100 companies listed on the London Stock
Exchange with the highest market capitalization. It is one of the most widely used stock indices and is
seen as a gauge of business prosperity. The index is maintained by the FTSE Group, a subsidiary of the
London Stock Exchange Group.
EURONEXT 100 - The index for largest and most liquid blue chip stocks traded on Euronext exchanges.
Companies listed the Euronext 100 must trade at least 20% of their issues annually (calculated on a
rolling basis). It is considered a major benchmark index for European stocks.
CAC40 - An index tracking the 40 largest and most liquid companies traded on the Paris Bourse stock
exchange. Established in 1987, it is the premier index tracking the general direction of the French
market and economy; it is roughly the French equivalent of the Dow Jones Industrial Average. The CAC
40 is weighted for market capitalization.
DAX A blue chip index in Germany. It tracks the performance (dividends added in) of the 30 most
actively traded stocks on the Frankfurt Stock Exchange. Prices are taken from the Xetra electronic
trading system and are updated every minute.
ASIAN MARKETS (Australia ASX ALL Ordinaries, Shangai SE Composite Index, Hang Seng, Mumbai
Sensex, Nikkei 225, Taiwan TSEC 50 Index)
Identify at least three Asian Stock Markets and compare between them and the US stock market.
REGULATORY AND GOVERNANCE IMPLICATIONS ON STOCK MARKETS
Compare between at least three countries or regions with respect to the stock market regulations. The
comparison should include the general regulations of each stock market and the main differences
between them.
NIKKEI 225 A price-weighted index consisting of 225 prominent stocks on the Tokyo Stock Exchange.
The Nikkei has been calculated since 1950 and its direction is considered an indicator of the state of the
Japanese economy. Most analysts consider it the Japanese equivalent of the Dow Jones Industrial
Average.
TAIWAN (TSEC 50) The only stock exchange in Taiwan. Trading began on it in 1962. It operates the
Taiwan Capitalization Weighted Stock Index.
SHANGAI (SSE COMPOSITE INDEX) A market composite made up of all the A-shares and B-shares that
trade on the Shanghai Stock Exchange. The index is calculated by using a base period of 100; the first
day of reporting was July 15, 1991.
HANG SENG INDEX (HSI) - A market capitalization-weighted index of 40 of the largest companies that
trade on the Hong Kong Exchange. The Hang Seng Index is maintained by a subsidiary of Hang Seng
Bank, and has been published since 1969. The index aims to capture the leadership of the Hong Kong
exchange, and covers approximately 65% of its total market capitalization. The Hang Seng members are
also classified into one of four sub-indexes based on the main lines of business including commerce and
industry, finance, utilities and properties.
2) INTERNATIONAL FINANCE
For those students who interested in integrating international finance subjects to their research should
include:
Identify at least two practices or theories related to International Finance. Include how these practices
or theories differ for local or multinational companies.
Identify the characteristic of the selected companies in your sample as multinational or regional
companies. Compare between the organizations charts of the selected companies. Identify the finance
functions and activities within the organization chart of each company.
Include exchange rates of currencies for the US and two European countries for the last five years.
Include the different types of investments in the international markets.
Compare between the US and the European Union investments in spot and forward markets. Include
the main differences and main similarities.
Differentiate between the US and European options and derivatives. Include the main differences and
main similarities.
Compare between exports and imports of the countries where the selected companies in your sample
do business.
Include the relative distribution of exports and imports of the USA for the last 5 years: Food and
beverage, Industrial supplies, capital goods, automobiles, consumer goods, other merchandise, and
services.





2) INTERNATIONAL FINANCE
For those students who interested in integrating international finance subjects to their research should
include:
Identify at least two practices or theories related to International Finance. Include how these practices
or theories differ for local or multinational companies.
Identify the characteristic of the selected companies in your sample as multinational or regional
companies. Compare between the organizations charts of the selected companies. Identify the finance
functions and activities within the organization chart of each company.
Include exchange rates of currencies for the US and two European countries for the last five years.
Include the different types of investments in the international markets.
Compare between the US and the European Union investments in spot and forward markets. Include
the main differences and main similarities.
Differentiate between the US and European options and derivatives. Include the main differences and
main similarities.
Compare between exports and imports of the countries where the selected companies in your sample
do business.
Include the relative distribution of exports and imports of the USA for the last 5 years: Food and
beverage, Industrial supplies, capital goods, automobiles, consumer goods, other merchandise, and
services.