Type of Markets - Analysis of a Firm Financial Performance - Management Assessment Answer

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I. INTRODUCTION
Briefly introduction of you work: the purpose of assignment, your findings and structure of your assignment (not more than 200 words)
II. ANALYSIS OF AUSTRALIAN FINANCIAL MARKET
2.1. Analysis of Australian financial market structure, including type of markets and types of financial institutions
Prepare a brief description of the Australian financial markets, including:
(1) Market sectors;
(2) Market regulators,
(3) Type of markets
(4) Types of financial institutions operating in the markets.
Analysis should be justified by necessary institutional documents, researches, journal articles and other reliable sources of information.
2.2. Identifying the sources of financial service and financial information available for investors in Australia
Do a research and should address the following questions: If the investor would like to invest in shares, bonds and derivative securities in Australia:
(1) Which financial institutions should they approach to open accounts and place their order for buying and selling that securities?
(2) Is there any limitation on foreign investment in Australian securities market?
(3) How do foreign investors pay tax on their income from investment on Australian securities market?

(4) If the investor would like to obtain information such as historical and current share, bond and derivative prices, which websites or organizations provide that kind of information?
(5) How the investor can obtain financial statements for their analysis of a firm financial performance
(6) What kind of financial statements are available for investors and what information they can exploit from each kind of financial statement for evaluating firm financial investment?
2. 3. Analysis of popular tools of capital budgeting (investment criteria) for Australian firms Identifying and analysing the popular practices of capital budgeting (investment criteria) for project evaluation taken by Australian companies. The following questions should be discussed and organized in a table:
(1) What are the investment criteria?
(2) What is the rationale for each criterion?
(3) What is the decision rule for each criterion?
(4) What are advantages and disadvantages of each criterion?
(5) Which criteria is more or less popularly used in Australia? Why is that?
2.4. Analysis of the Australian Bond market
Do a research and provide analysis of Australian bond market. The following questions should be address:
(1) Where the bonds are traded secondarily in Australia? What are the types of bonds are traded in that market place?
(2) Who provide bond rating service and what are ratings used for bonds in Australia?
(3) Identify the key differences between Australian Government Bonds and Corporate Bonds
(4) Explain the nature of yield to maturity (YTM), identify the relationship between coupon rate and YTM, using an example of bond evaluation with coupon rate which is higher and then lower than YTM for illustration.
(5) What is the interest rate risk and how does it affect bond price?
2.5. Analysis of Australian Share market Do a research and provide analysis of Australian share market. The following questions should be
addressed:
(1) What is the name of listed stock market in Australia, how is it operated, how many shares are traded in the market place at the present?
(2) What is the oldest share index in Australia, what does it measures, how many listed stocks are there in the index at the present and how the index is calculated?
(3) What is market capitalization of a listed company, how is it computed?
(4) Go to ASIC website and obtain 3 years historical movement graph of that index
(5) Comment on the trend, do a research and identify the factors that may explain the trend.
2.6. Identifying and recommending of a potential industry for financial investment Identify an industry that you think potential for the investor to invest in the Australian financial market.
Justify your recommendations by providing data supported analysis on the following areas:
(1) Market capitalization of the industry
(2) Historical data of stock market price. Tips: searching for specific industry index, for example Australia Construction Index or Health Sector Index at
(3) Financial performance analysis of the industry

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