The Conceptual Foundations of Investing : A Short Book of Need-To-Know Essentials

Cover -- Title Page -- Copyright -- Contents -- Preface -- 1 Returns -- Stocks, Bonds, and Bills -- Return Mathematics -- Volatility -- Average Returns -- Using Returns to Test Investment Theories -- Returns and Stock Market History -- Conceptual Foundation 1 -- 2 The Economic Structure of Investment Markets -- The Arithmetic of Financial Markets -- The Efficient Market Hypothesis -- Informational Versus Fundamental Market Efficiency -- The Efficient Market Hypothesis and Sharpe's Arithmetic -- Who Are Your Counterparties? -- Enough of the Theory, What About Results? -- Conceptual Foundation 2 -- 3 Bonds and Inflation -- Treasury Bills and Treasury Bonds -- Treasury Bills -- Treasury Notes and Bonds -- Interest Rates and Inflation -- Bond Yields and Bond Returns -- Treasury Inflation Protected Securities (TIPS) -- Corporate Bonds and Credit Risk -- Promised Yields Versus Expected Yields -- The Role of Diversification in Bond Investing -- Superior Returns from Low‐Grade Bond Investing -- Conceptual Foundation 3 -- 4 Risk and Return -- Risk Aversion and Risk Premiums -- The Equity Market Risk Premium -- Applying the CAPM -- Applying the CAPM to Securities Other than Stocks -- Discount Rates for Equity Cash Flows -- Liquidity and Expected Returns -- Conceptual Foundation 4 -- 5 Fundamental Analysis and Valuation -- Bubbles -- Fundamental Valuation -- Free or "Dividendable" Cash Flow -- The Constant Growth Model -- A More Realistic Model -- Warren Buffett's "Secret" to Investing -- A Detailed Example: Tesla -- Short Selling -- Call Options -- How the Market Sets Stock Prices -- Fundamental Investing and Diversification -- Finding Mispriced Stocks -- What to Do if Mispricing Gets "Worse" -- How Do You Tell if the Market Is "Expensive?" -- The Social Benefits of Fundamental Investment Analysis -- Conceptual Foundation 5.