The question consists of three sub questions. Let me answer the third question first.The reason for answering the third question first as its a theoretical question and the other two are application based questions.
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The answer to this question would be:
Asset Allocation mainly means allocating your surplus income into various/different asset classes which would be used to earn Dividends, Interests and Capital Appreciation. Asset Classes would be :
The proportion of distribution varies according to the Risk Appetite of the investor. A proper mix of asset classes would result in an investor having a Winning Portfolio. Ideally the suggested mix of asset classes for a person who is willing to take risks would be as shown below in the pie chart:
By following the above asset allocation strategy performance of the investments of the investor could be beneficial.
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Now let us take up the first question.
The answer to this question would be:
It is important for us to understand what are the various business segments of Caterpillar Inc then we could compare and analyze the market and industry performance
The segments in which the company operates are:
On analyzing the financial statements for the previous five years i.e. from 2014 to 2018 we could see that there was a dip in earnings in the year 2016 and the company incurred a huge loss. However it recovered back in 2017 and its Free Cash Flow improved drastically which in return improved the Earnings Per Share and the other ratios for the company.The company gained on the foreign exchange transactions also during the year.
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Let us answer the second question
The answer to the above question would be:
To analyze the performance of Caterpillar Inc by comparing it with its industry peers we need to do an analysis segment wise or business wise to get the correct picture. The segments in which Caterpillar operates are:
Let us take up each of the segment individually and compare the performance.
How would you assess the Caterpillars market and industry performance based on its five-year revenues and...
QUESTION 5 Consider the performance of two securities, J and K over the five year period from 2014 to 2018. The annual return earned on each one of them is as provided in the table below: Year J K % % 2014 37.9 -15.8 2015 28.4 19.8 2016 -0.1 12.8 2017 -50.0 -20.8 2018 31.7 58.6 Required: Compute the following: Assume your organization had K150 million to invest on 01st January, 2014. If 70% was invested in security J over...
QUESTIONS Consider the performance of two securities and k over the five year period from 2014 to 2018. The annual return earned on each one of them is as provided in the table below Year 379 28.4 -15 a 2014 2015 2016 2017 2018 19.8 128 -208 58.6 -500 31.7 Required: Compute the following: a) Assume your organization had K150 million to invest on 01st January, 2014. If 70% was invested in security J over the holding period, the annual...
plz solve step by step with formuls The Corrigan Corporation's 2011 and 2012 financial statements follow, along with some industry average ratios. a. Assess Corrigan's liquidity position and determine how it compares with peers and how the liquidity position has changed over time. b. Assess Corrigan's asset management position and determine how it compares with peers and how its asset management efficiency has changed over time. c. Assess Corrgigan's debt management position and determine how it compares with peers and...
Topic: Comparative Market Analysis of an organization 1. Select a industry in which you are interested (i.e.: consumer goods, industrial goods, travel, postal, health care, entertainment, finance, retail, etc.). 2. Select a leading business in your field of interest. For example, in the travel industry, you might select an airline, a cruise line, a tourism bureau, a hotel chain, a travel agency, a car rental firm or a resort/destination. 3. Prepare a critical evaluation of the organization that you have...
pehormance within of an index of share returns for a particular country or industry sector a corporation rather than purchased. 9. Commercial paper is a short-term security issued by A. the Federal Reserve Bank D. the New York Stock Exchange 10. Theindex represents the performance of the Canadian stock market. A. DAX 11. Shelf registration A. is a way of placing issues in the primary market. B. allows firms to register securities for sale over a two-year period. C. increases...
One of the most important applications of ratio analysis is to compare a company's performance with that of other players in the industry or to compare its own performance over a period of time. Such analyses are referred to as a comparative analysis and trend analysis, respectively. A common size analysis requires the representation of financial statement data relative to a single financial statement item (or base account or value) What is the most commonly used base item for a...
1.What four ratios would you use to evaluate a service business and why? 2.Reviewing Stryker Corporation's four years of ratios on page 65 of your text, what trends do you see and what are your suggestions for improvement? 3.How does Accounts Receivable Turnover relate to Number of Days Sales in Receivables? 4.What does context mean in ratio analysis and how did we use it to analyze the Stryker Corporation? Chapter 2 Eluting Financial Performance 65 TABLE 22 Ratio Analysis of...
13. Ratio analysis A company reports accounting data in its financial statements. This data is used for financial analyses that provide insights into a company's strengths, weaknesses, performance in specific areas, and trends in performance. These analyses are often used to compare a company's performance to that of its competitors, or to its past or expected future performance. Such insight helps managers and analysts improve their decision making. Consider the following scenario: You work as an analyst at a credit-rating...
Asset management ratios are used to measure how effectively a firm manages its assets, by relating the amount a firm has invested in a particular type of asset (or group of assets) to the amount of revenues the asset is generating. Examples of asset management ratios include the average collection period (also called the days sales outstanding ratio), the inventory turnover ratio, the fixed asset turnover ratio, and the total asset turnover ratio. Consider the following case: Polk Software Inc....
You are a top executive in your corporation. After careful consideration, you were selected to work on a project to use MIS to change the way business is run. You will be responsible for researching the practices in your industry, identify the strengths and weaknesses of the industry, and make an innovative plan to use MIS to improve on current practices Your report MUST include the following side headings: • History and Background (provide detailed information about the industry, past...