Uploaded by osmansaif

Investment Banking for Dummies

advertisement

Business & Economics/Banks & Banking

The keys you need to know about investment banking

Want to expand your knowledge or learn what you need to know to ace your investment banking course? This in-depth guide takes a comprehensive approach to the topic of investment banking so you can discover everything you’ll need to know to apply your knowledge in the real world.

• Get started with investment banking mergers, and acquisitions — find out what investment bankers do and how they facilitate financing, • Dig in — discover the hidden truth in financial statements, where to find and read the reports you’ll need, and how to perform industry analysis • Take it to the next level return on equity — dig into the details of discounted cash flow analysis, structuring a leveraged buyout, and determining • Apply investment banking — understand the past of investment banking and new regulations that define the rules of the game • Fill your tool box — discover the best online resources for investment bankers, ways to improve your analysis, and other important tools and tips

Open the book and find: • What investment banking is and how it works • The role of investment bankers in mergers and acquisitions • How to use important corporate filing documents • The uses of financial statements • Details on performing discounted cash flow analysis • A thorough overview of fixed income • How to determine a company’s return on equity • Case studies to help reinforce your reading Cover Image:

©iStockphoto.com/Danil Melekhin

Matt Krantz

is the stock market and IPO reporter for

USA TODAY

, covering financial markets and Wall Street.

Robert R. Johnson, PhD, CFA, CAIA

, is a Professor of Finance at Creighton University, where he teaches in the Master of Security Analysis and Portfolio Management Program.

Go to Dummies.com

® for videos, step-by-step photos, how-to articles, or to shop!

$26.99 USA / $31.99 CAN / £19.99 UK ISBN:978-1-118-61577-5 52699 9 781118 615775

Making Everything E asier!

Investment

Krantz Johnson

Learn to:

Grasp and apply the fundamentals of investment banking

Understand post-financial crisis changes

Score higher in your investment banking course

Matthew Krantz

Author of

Investing Online For Dummies

Robert R. Johnson, PhD, CFA, CAIA

Professor of Finance, Creighton University

Get More and Do More at Dummies.com

®

Start with

FREE

Cheat Sheets

Cheat Sheets include • Checklists • Charts • Common Instructions • And Other Good Stuff!

To access the Cheat Sheet created specifically for this book, go to

www.dummies.com/cheatsheet/investmentbanking

Get Smart at Dummies.com

Dummies.com makes your life easier with 1,000s of answers on everything from removing wallpaper to using the latest version of Windows. Check out our • Videos • Illustrated Articles • Step-by-Step Instructions Plus, each month you can win valuable prizes by entering our Dummies.com sweepstakes. * Want a weekly dose of Dummies? Sign up for Newsletters on • Digital Photography • Microsoft Windows & Office • Personal Finance & Investing • Health & Wellness • Computing, iPods & Cell Phones • eBay • Internet • Food, Home & Garden

Find out “HOW” at Dummies.com

*Sweepstakes not currently available in all countries; visit Dummies.com for official rules.

At home, at work, or on the go, Dummies is here to help you go digital!

From eLearning to e-books, test prep to test banks, language learning to video training, mobile apps, and more,

Dummies makes learning easier.

www.facebook.com/fordummies www.twitter.com/fordummies

Investment Banking

by Matthew Krantz and Robert R. Johnson, PhD, CFA, CAIA

Investment Banking For Dummies ®

Published by:

John Wiley & Sons, Inc.,

111 River Street, Hoboken, NJ 07030-5774, www.wiley.com

Copyright © 2014 by John Wiley & Sons, Inc., Hoboken, New Jersey Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the Publisher. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions .

Trademarks:

Wiley, For Dummies, the Dummies Man logo, Dummies.com, Making Everything Easier, and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc., and may not be used without written permission. All other trademarks are the property of their respective owners. John Wiley & Sons, Inc., is not associated with any product or vendor mentioned in this book.

LIMIT OF LIABILITY/DISCLAIMER OF WARRANTY: WHILE THE PUBLISHER AND AUTHOR HAVE USED THEIR BEST EFFORTS IN PREPARING THIS BOOK, THEY MAKE NO REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY OR COMPLETENESS OF THE CONTENTS OF THIS BOOK AND SPECIFICALLY DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. NO WARRANTY MAY BE CREATED OR EXTENDED BY SALES REPRESENTATIVES OR WRITTEN SALES MATERIALS. THE ADVISE AND STRATEGIES CONTAINED HEREIN MAY NOT BE SUITABLE FOR YOUR SITUATION. YOU SHOULD CONSULT WITH A PROFESSIONAL WHERE APPROPRIATE. NEITHER THE PUBLISHER NOR THE AUTHOR SHALL BE LIABLE FOR DAMAGES ARISING HEREFROM.

For general information on our other products and services, please contact our Customer Care Department within the U.S. at 877-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002. For technical support, please visit www.wiley.com/techsupport .

Wiley publishes in a variety of print and electronic formats and by print-on-demand. Some material included with standard print versions of this book may not be included in e-books or in print-on-demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com

. For more information about Wiley products, visit www.wiley.com

.

Library of Congress Control Number: 2013954075 ISBN 978-1-118-61577-5 (pbk); ISBN 978-1-118-61570-6 (ebk); ISBN 978-1-118-61571-3 (ebk); ISBN 978-1-118-61588-1 (ebk) Manufactured in the United States of America 10 9 8 7 6 5 4 3 2 1

Contents at a Glance

Introduction ................................................................ 1 Part I: Getting Started with Investment Banking ............ 5

Chapter 1: Introducing Investment Banking ................................................................... 7 Chapter 2: The Purpose of Investment Banking: What Investment Bankers Do...... 23 Chapter 3: How Investment Bankers Sell Companies ................................................. 43 Chapter 4: How Investment Banking Is Used in Mergers and Acquisitions ............. 61 Chapter 5: How Investment Banking Is Used in Leveraged Buyouts......................... 79

Part II: Digging In: Performing Investment Banking ..... 93

Chapter 6: Finding the Data: Documents and Reports ................................................ 95 Chapter 7: Making Sense of Financial Statements ..................................................... 113 Chapter 8: Perfecting the Financial Ratios for Investment Banking ........................ 133 Chapter 9: Sizing Up the Industry ................................................................................ 151 Chapter 10: Understanding Stocks and Focusing on Past Transactions ................ 169 Chapter 11: Applying Investment Banking to Fixed Income..................................... 183

Part III: Taking Investment Banking to the Next Level ...201

Chapter 12: Doing a Discounted Free Cash Flow Analysis ....................................... 203 Chapter 13: Structuring a Leveraged Buyout ............................................................. 223 Chapter 14: Determining the Strength of a Company’s Return on Equity .............. 237

Part IV: Applying Investment Banking ...................... 253

Chapter 15: Knowing the Rules .................................................................................... 255 Chapter 16: Seeing How Some Companies Lie, Cheat, and Steal Their Way to the Top .................................................................................................. 269 Chapter 17: Understanding Alternative Investments and Asset Management ...... 289 Chapter 18: Trying Your Hand at Investment Banking with a Case Study ............. 303

Part V: The Part of Tens ........................................... 315

Chapter 19: Ten of the Biggest Debacles in Investment Banking History .............. 317 Chapter 20: Ten Ways to Improve a Discounted Cash Flow Analysis ..................... 325 Chapter 21: Ten (Or So) of the Best Online Resources for Investment Bankers ...... 333

Appendix: Where Investment Banking Came From ...... 341 Index ...................................................................... 349

Table of Contents

Introduction ................................................................. 1

About This Book .............................................................................................. 1 Foolish Assumptions ....................................................................................... 3 Icons Used in This Book ................................................................................. 3 Beyond the Book ............................................................................................. 4 Where to Go from Here ................................................................................... 4

Part I: Getting Started with Investment Banking ............ 5

Chapter 1: Introducing Investment Banking . . . . . . . . . . . . . . . . . . . . . . . 7

What Investment Banking Is ........................................................................... 8 The role investment banking plays ..................................................... 8 How investment banking differs from traditional banking ............. 10 The services investment banks provide ........................................... 11 How investment banks are organized ............................................... 12 The current lay of the investment banking land .............................. 14 Types of investment banking operations ......................................... 15 How investment banks get paid ......................................................... 15 How Investment Banking Is Done ................................................................ 17 Finding the financial statements ........................................................ 17 Understanding the importance of financial statements and ratios ......................................................................................... 18 Zeroing in on past transactions ......................................................... 18 Seeing the value of fixed income........................................................ 19 Turning Into an Investment Banking Pro .................................................... 19 Putting the discounted cash flow analysis to work ......................... 19 Seeing how leverage becomes a force in investment banking ....... 20 Pinpointing buyout targets ................................................................. 20 Putting Investment Banking to Work .......................................................... 21 Staying in compliance with the rules ................................................ 21 Looking beyond the published financial statements ...................... 21 Making adjustments to financial statements for comparability ................................................................................... 22

Chapter 2: The Purpose of Investment Banking: What Investment Bankers Do . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Putting the For-Sale Sign on Corporate America ....................................... 24 Mergers and acquisitions ................................................................... 25 Leveraged buyouts .............................................................................. 28 Private business sales ......................................................................... 30 Initial public offerings ......................................................................... 32

vi

Investment Banking For Dummies

Helping Investors Decide Whether to Buy or Sell ..................................... 36 The importance of research ............................................................... 36 What do the analysts do?.................................................................... 37 Digging Into the Role of the Trading Desk .................................................. 38 Why investment banks are into trading ............................................ 39 How investment banks turn pennies into billions ........................... 40 The type of analysis used in trading operations ............................. 41

Chapter 3: How Investment Bankers Sell Companies . . . . . . . . . . . . . 43

Getting Companies Ready for Sale on Public Markets .............................. 44 Meeting the requirements to make an IPO happen ......................... 45 Writing the prospectus ....................................................................... 47 Supporting the IPO: Making success last .......................................... 51 Seeing What Sell-Side Analysts Do .............................................................. 53 The goals of the sell-side analyst ....................................................... 53 What investors look to sell-side analysts for ................................... 54 Spreading the word: Disseminating sell-side research ................... 55 Examining a Sample Research Report ........................................................ 56 What to look for in the document ...................................................... 56 The main sections of a research report ............................................ 57 Ways to look beyond the “buy” or “sell” .......................................... 59

Chapter 4: How Investment Banking Is Used in Mergers and Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

Come Here Often? The Basics of Mergers and Acquisitions .................... 61 Kinds of mergers .................................................................................. 62 Why companies merge instead of simply growing organically ......................................................................................... 63 Firms that make attractive acquisition targets ................................ 66 How companies identify firms to merge with .................................. 67 The nature of the merger: Friendly or hostile? ................................ 68 Tools Used to Analyze the M&A Deal ......................................................... 71 The role of the buy-side M&A advisor .............................................. 71 The role of the sell-side M&A advisor ............................................... 74 Why Many M&A Deals Go Wrong ................................................................ 75 Misplaced incentives ........................................................................... 75 Faulty analysis ...................................................................................... 76 Overstated synergies........................................................................... 77 Culture wars ......................................................................................... 77 The winner’s curse: Overpaying ........................................................ 78

Chapter 5: How Investment Banking Is Used in Leveraged Buyouts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

In This Corner: Introducing the Players ..................................................... 80 Investment banks ................................................................................. 81 Big institutions ..................................................................................... 82

Table of Contents

Management ......................................................................................... 83 Stock and bond investors ................................................................... 84 Aiming for the Right Targets in a Leveraged Buyout ................................ 85 Identifying companies that can work in a leveraged buyout ......... 85 Appreciating the power of cash flow ................................................ 87 Coming to terms with the return analysis: Internal rate of return ..................................................................................... 88 Finding the Exit .............................................................................................. 90 Setting a target for exit in time ........................................................... 90 Considering how the exit will happen ............................................... 90

Part II: Digging In: Performing Investment Banking ...... 93

Chapter 6: Finding the Data: Documents and Reports . . . . . . . . . . . . . 95

Finding What You Need on the Securities and Exchange Commission’s Website ............................................................ 96 What types of information you can find ........................................... 96 The key types of documents .............................................................. 97 How to use EDGAR to pinpoint information ..................................... 98 Getting Data in a Format You Can Work With ......................................... 103 Assembling the tools you need ........................................................ 103 Importing financial information into Excel ..................................... 105 Getting in tune with interactive data ............................................... 106 Paying Attention to the Non-Financial Information ................................. 107 Monitoring news streams for investment banking ideas .............. 107 Quickly processing information with aggregators ........................ 109 Doing research on the key players in a deal .................................. 111

Chapter 7: Making Sense of Financial Statements . . . . . . . . . . . . . . . 113

Income Statements ...................................................................................... 114 Locating the areas of interest to investment bankers .................. 116 Tweaking the statement with different assumptions .................... 117 Finding investment banking opportunities .................................... 118 Balance Sheets ............................................................................................. 119 Finding your way around the key parts .......................................... 120 Understanding a company’s financial strength ............................. 122 Locating pitfalls and opportunities ................................................. 124 Statement of Cash Flows ............................................................................. 124 Seeing why the cash flow statement is so important in deal making ................................................................................. 125 Understanding the key parts of the document .............................. 125 Calculating free cash flow ................................................................. 128 Proxy Statements ......................................................................................... 128 Learning about the key players in a deal ........................................ 129 Identifying the management team’s incentives ............................. 130 Analyzing management pay packages ............................................. 131

vii

viii

Investment Banking For Dummies Chapter 8: Perfecting the Financial Ratios for Investment Banking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133

Valuation Multiples: Assessing How Much the Company Is Worth ...... 134 Investors’ favorite valuation tool: P/E ratio ................................... 134 Going old school with price-to-book ............................................... 135 Putting a price on profitability ......................................................... 136 Liquidity Multiples: Checking Companies’ Staying Power ..................... 138 Deciphering debt to equity ............................................................... 139 Getting up to speed with the quick ratio ........................................ 140 Interpreting interest coverage ......................................................... 140 Profitability Ratios: Seeing How a Company’s Bottom Line Measures Up..................................................................................... 141 Why gross margin isn’t so gross after all........................................ 142 Income from continuing operations: Looking at profit with a keen eye .................................................................... 142 Keying into profits with net margin ................................................. 143 Efficiency Ratios: Knowing How Well the Company Is Using Investors’ Money ........................................................................... 144 Finding out about return on assets ................................................. 145 Digging into return on capital .......................................................... 146 Uncovering company secrets with return on equity .................... 148 Calculating a company’s growth rate .............................................. 148

Chapter 9: Sizing Up the Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151

Performing an Industry Analysis ............................................................... 152 Understanding why industry analysis is important ...................... 152 Creating a comparison universe ...................................................... 153 Adjusting the industry comparison universe ................................. 157 Unearthing Company Trends and Common sizing the Financial Statements ......................................................................... 158 Comparing growth rates ................................................................... 158 Comparing leverage ........................................................................... 161 Comparing various profit margins................................................... 162 Seeing How a Company Stacks Up: Comparing the Key Ratios ............. 164 Sizing up valuation ............................................................................. 164 Comparing total debt-to-equity ........................................................ 167 Sizing up companies on their efficiency ......................................... 167 Industry ratios .................................................................................... 168

Chapter 10: Understanding Stocks and Focusing on Past Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169

Introducing Stock ........................................................................................ 170 Characteristics of stock .................................................................... 170 Types of stock .................................................................................... 172 Understanding stock pricing ............................................................ 173

Table of Contents

Finding Past Transactions .......................................................................... 174 Tracking the stock market ................................................................ 174 Studying private deals ....................................................................... 174 Looking at pre-IPO marketplaces ..................................................... 176 Examining buyouts ............................................................................ 176 Analyzing Past Transactions ...................................................................... 177 Knowing what the market will bear ................................................. 177 Knowing when the market is distorted ........................................... 178 Tabulating key ratios for past deals ................................................ 179 Understanding the pitfalls ................................................................ 182

Chapter 11: Applying Investment Banking to Fixed Income . . . . . . . 183

Introducing Bonds ....................................................................................... 184 Identifying the Various Types of Bonds ................................................... 186 Convertible bonds ............................................................................. 187 Callable bonds .................................................................................... 187 Puttable bonds ................................................................................... 187 Floating-rate bonds ............................................................................ 187 Zero-coupon bonds ........................................................................... 188 Knowing Their Place: The Position of Bondholders ............................... 188 Understanding Bond Pricing ...................................................................... 190 Introducing the concept of present value ...................................... 190 Relating yield to maturity and price ................................................ 193 Playing the spread: How different factors affect bond prices...... 194 Considering bond sensitivity to changes in interest rates ........... 195 Tracking the Bond Market .......................................................................... 198 Debt or Equity: How a Company Chooses ................................................ 200

Part III: Taking Investment Banking to the Next Level ..... 201

Chapter 12: Doing a Discounted Free Cash Flow Analysis . . . . . . . . 203

Gearing Up for Discounted Free Cash Flow .............................................. 204 Computing free cash flow ................................................................. 206 Forecasting free cash flow ................................................................ 207 Calculating the Weighted Average Cost of Capital .................................. 208 Understanding why the weighted average cost of capital is so important ................................................................... 209 Measuring the cost of debt and equity ........................................... 210 Understanding the capital asset pricing model ............................. 213 Going for Terminal Value ............................................................................ 216 Knowing the perpetuity growth formula ........................................ 216 Applying the constant growth formula ........................................... 217 Applying the two-stage growth model ............................................ 217 Stress-testing the results .................................................................. 219 Valuing a Share of Stock ............................................................................. 220

ix

x

Investment Banking For Dummies Chapter 13: Structuring a Leveraged Buyout . . . . . . . . . . . . . . . . . . . . 223

Seeing How Leveraged Buyouts Are Structured ...................................... 224 The types of financing ....................................................................... 224 Understanding seniority and maturity ............................................ 230 Building a Leveraged Buyout Model ......................................................... 231 Creating a pro forma model.............................................................. 232 Deciding on methods of financing ................................................... 233 Seeing how the results work out ...................................................... 234 The importance of taxes in a leveraged buyout ............................ 235 What can go right and what can go wrong ..................................... 235

Chapter 14: Determining the Strength of a Company’s Return on Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237

Understanding the Importance of Return on Equity ............................... 238 What return on equity shows ........................................................... 239 Pros and cons of return on equity versus other profitability measures ................................................................... 241 How return on equity can help guide an investment banking deal .................................................................................... 244 Using a DuPont Analysis ............................................................................. 244 The three-factor DuPont method ..................................................... 245 The five-factor DuPont method ........................................................ 247 Interpreting the Results .............................................................................. 249 Cola wars............................................................................................. 249 What the numbers mean ................................................................... 250 Looking past the numbers for insight ............................................. 251 Telling companies how to react to the numbers ........................... 251

Part IV: Applying Investment Banking ....................... 253

Chapter 15: Knowing the Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255

The History of Regulation of Investment Banking ................................... 255 The goals of investment banking regulation .................................. 256 Why the rules of today are the result of days past ....................... 256 How regulations have shaped the investment banking industry ............................................................................ 256 The Ins and Outs of Modern Investment Banking Rules ........................ 258 The types of rules imposed on investment banking ..................... 258 How investment banking rules changed after the financial crisis ................................................................................. 261 The Rules on Analysts ................................................................................. 263 Why rules were needed ..................................................................... 263 The not-so-delicate balancing act analysts play ............................ 264 What disclosure and compliance are required .............................. 265 Why Simply Making Rules Isn’t Enough .................................................... 267

Table of Contents Chapter 16: Seeing How Some Companies Lie, Cheat, and Steal Their Way to the Top . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 269

Did You Really Sell That? When Companies Aggressively Report Revenue ........................................................................................ 270 Don’t let the sun go down on me ..................................................... 271 The truth? ........................................................................................... 272 Lucy, You Got Some ’Splainin’ to Do: When Companies Understate Their Expenses ......................................................................................... 274 What a waste ...................................................................................... 274 Crazy like a fox ................................................................................... 275 Missed It by That Much: When Companies Overstate Their Financial Position .......................................................................... 276 Those pesky pensions: The epidemic of firms understating pension liabilities ........................................................................... 276 We are the world ................................................................................ 280 Keeping Investors Off-Balance ................................................................... 281 Enron’s special purpose ................................................................... 282 A mountain of a scandal .................................................................... 284 Swap meet ........................................................................................... 286 What Should an Investment Banker Do? .................................................. 287

Chapter 17: Understanding Alternative Investments and Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289

Knowing Your Alternatives ........................................................................ 289 Hedge funds ........................................................................................ 290 Venture capital ................................................................................... 292 Commodities ...................................................................................... 293 Real estate........................................................................................... 295 Digging Into Asset Management ................................................................ 296 Attracting investors to asset management ..................................... 296 Creating asset management tools .................................................... 297 Managing Potential Conflicts with Clients ................................................ 299 How asset management can cause conflicts .................................. 299 How to eliminate and manage conflicts .......................................... 301

Chapter 18: Trying Your Hand at Investment Banking with a Case Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 303

Setting the Scene ......................................................................................... 303 The acquirer ....................................................................................... 304 The target............................................................................................ 304 Considering the Options ............................................................................. 305 Identifying the options ...................................................................... 305 Looking at financing .......................................................................... 306 Creating the Analysis .................................................................................. 307 An analysis of the financial statements .......................................... 307

xi

xii

Investment Banking For Dummies

Structuring a Deal ........................................................................................ 310 Form of acquisition ............................................................................ 311 Creating pro forma statements ........................................................ 311 Success or Failure ........................................................................................ 314

Part V: The Part of Tens ............................................ 315

Chapter 19: Ten of the Biggest Debacles in Investment Banking History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 317

The Dot-Com Boom and Bust ..................................................................... 318 Tainted Research Scandals ........................................................................ 319 Enron and the Accounting Scams .............................................................. 319 The Mortgage Debacle and Collapse of Lehman ..................................... 320 The Flash Crash ........................................................................................... 321 The London Whale at JPMorgan and Barings Bank ................................ 321 Long-Term Capital Management ................................................................ 322 Bankruptcy in Jefferson County, Alabama ............................................... 323 IPO Allocations with CSFB .......................................................................... 323 Bad Mergers and Acquisitions Like AOL Time Warner .......................... 324

Chapter 20: Ten Ways to Improve a Discounted Cash Flow Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325

Financial Analysis Isn’t Physics ................................................................. 325 Show Your Sensitive Side ........................................................................... 326 Monte Carlo Isn’t Just for High Rollers ..................................................... 327 What Can Go Wrong Will Go Wrong .......................................................... 327 It’s Tough to Make Predictions, Especially about the Future ................ 328 The Investor of Today Doesn’t Profit from Yesterday’s Growth ........... 329 Garbage In, Garbage Out ............................................................................. 330 Rates Are Falling — It’s a Better Deal! ....................................................... 330 Read Your Putt from Several Angles ......................................................... 331 The Weighting Is the Hardest Part ............................................................ 332

Chapter 21: Ten (Or So) of the Best Online Resources for Investment Bankers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333

Bloomberg .................................................................................................... 333 Reuters .......................................................................................................... 334 Standard & Poor’s ........................................................................................ 335 Renaissance Capital and IPOScoop.com .................................................. 335 The Securities and Exchange Commission .............................................. 336 Moody’s ........................................................................................................ 336

Table of Contents

xiii

FreeStockCharts.com .................................................................................. 337 Index Fund Advisors ................................................................................... 337 Morningstar .................................................................................................. 338 Bureau of Labor Statistics .......................................................................... 338 Department of Commerce .......................................................................... 339 Federal Reserve ........................................................................................... 339 Trefis ............................................................................................................. 340

Appendix: Where Investment Banking Came From ....... 341 Index ....................................................................... 349

Download