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Bank Investing - A Practitioner's Field Guide (Hardcover)
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Bank Investing - A Practitioner's Field Guide (Hardcover)
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Bank Investing: A Practitioner's Field Guide offers you the
essential toolkit to become a successful bank investor. It packages
practical lessons, theoretical knowledge, and historical context,
all into one compelling and hopefully entertaining book. The book
includes conversations with investors and management teams.
Investors include activists, financials specialists, credit
investors, and multibillion-dollar asset managers. Management teams
have a broad representation from the c-suite of a broad spectrum of
participants ranging from a fintech to a bank with over $30bn in
assets. Banks are the oil that lubricates the economy. An
understanding of how they operate is essential for analyzing any
part of the economy since banks represent a large investing
universe and control a sizeable portion of assets. With over 800
public tickers representing over $3 trillion market cap, banks are
larger than several other industry groups. Banks are the largest
financial intermediaries in the U.S., controlling $15 trillion in
financial assets. Their relative size can amplify effects. For
example, a small regulatory or environmental change can cascade and
ripple through financial markets and have a major impact on the
economy. As fintechs gain in prominence, a fundamental grasp of
topics related to banking will help enhance understanding of
fintech. Bank investing can be a fruitful pursuit: The most
successful investor of our times, Warren Buffett, has had a
sizeable investment in banks over time (close to a third of his
portfolio weight used to be in banks). Banks allow you to make
macro-economic bets since they are highly levered to business
cycles. Bank investing allows you to scale your knowledge, as they
have relatively homogenized business models... ...at the same time,
banks are diverse enough to drive meaningful dispersion in price
performance. This divergence of performance can be taken advantage
of by an astute and prepared securities analyst. Banks are good
vehicles to make specific investment plays on geographic regions,
demographic trends (suburban to urban migration, aging), industries
(agriculture, tech, energy), news flow (trade/tariffs, weather),
real estate subsectors (NYC office, bay area apartments), and
investing themes such as ESG, cryptocurrency, and venture capital.
Finally, fintech disruption is creating an investing opportunity to
play the digital divide between banks that embrace technology
successfully and those that get left behind.
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