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Discussion Topic: Finance

Congratulations! You are about to graduate with your bachelor's degree. While you are mixing and mingling with the guests at your graduation party, your second cousin, twice removed, on your mother's side, who received his MBA three years ago, asks you to tell him about some of the courses that you had taken. After you tell him that financial management was one of the courses, he asks you the following questions:

- What factors can managers actually influence that affect stock price?
- What role do you think ethics plays in financial management in corporations today?
- For recent graduates, are there any new finance careers or "hot" areas of opportunity?

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- What factors can managers actually influence that affect stock price?

Ten factors are worth noting when it comes to how managers influence stock prices. First, market sentiment can impact the direction in which it goes. This is done by looking at the stock index and other factors as well. Second, how the industry performs can make all the difference. Third, earnings that occur within the company itself. Fourth, when a merger occurs can actually boost the stock. Fifth, when a new product is introduced to the market. This makes it a hot item and people are interested in learning more about it as well as spreading the word. Sixth, each time share is bought back. One can note that this deals with supply and demand and can reduce shares within the market. Seventh, when a dividend is announced, a particular stock could increase. Eighth, insider trading can occur within the company, especially with those who are in management. Ninth, when there is any kind of hedge trading with funds. This is considered smart money. Tenth, technology can impact it as well because this changes every ...

Solution Summary

This solution discussed factors managers do affect stock prices, an opinion on the role of ethics in financial management in incorporations today, and areas that are of hot opportunity for finance.