Price Ratio Analysis

Price Ratio Analysis is widely used in the investment industry to find the price of stocks. I provide my students with Value Line Investment Surveys of sample firms so that they can apply the price ratio analysis to evaluate the price of stocks of real firms. Kindly click on the following link to get the Value Line Investment report of Walmart.

Walmart’s Value Line Investment Report

After downloading such reports, students need to use the data from the report and create an excel sheet similar to the following one. This excel sheet will have the range of possible prices for firm’s stock.

Excel file for conducting Price Ratio Analysis

Now this activity makes my students really excited as they can apply their knowledge, learned in the course, to solve the real world situation. Hence, it keeps them engaged and help me to attain one of the important learning outcome of my course.

By: Dr. Zubair Ali Raja

Gathering Information about the Firm

In my Corporate Finance and Financial Statement Analysis Classes, group of 4 students need to analyze a company. To ensure a sound analysis, I always ask them to find out the answers to the following questions, as first assignment, so that they know the nature of firm’s business, background, capabilities, competitive advantage and its industry. This keeps them engaged right from the start and confirms that learning outcomes will be attained. Also, I open a discussion forum related to this assignment where we talk about few sample companies like Apple, Intel, Walmart, Lululemon, Costco etc. This allows my students to understand how they need to answer the questions of this assignment which are given below.

Q1: What is the business, the products, the customers, what is the recent historic economic performance, what are the recent strategic decisions taken the company?

Q2: What are the key success factors and risks associated with the firm’s chosen competitive strategy?

Q3: Does the firm currently have the resources and capabilities to deal with the key success factors and risks?

Q4: Has the firm made irreversible commitments to bridge the gap between its current capabilities and the requirements to achieve its competitive advantage?

Q5: Has the firm structure its activities (such as research and development, design, manufacturing, marketing and distribution and support activities) in a way that is consistent with its competitive strategy?

Q6: Is the company’s competitive advantage sustainable? Are there any barriers that make imitation of the firm’s strategy difficult?

Q 7: Are there any potential changes in the firm’s industry structure (such as new economic conditions, new technologies, foreign competition, changes in regulation, change in customer requirements) that might dispute the firm’s competitive advantage? Is the company flexible enough to address the change?

Students can find the answers of these questions from the quarterly (10-Q) and annual (10-K) reports submitted by the firm to security and exchange commission (SEC) which is also publicly available on SEC’s website. American firms’ statements can be accessed on www.sec.gov and Canadian firms’ financial reports are available on www.sedar.com

Now this activity provides hand on experience to my students that how publicly available information or data can be utilized to understand the company and subsequently conduct good analysis to gauge the financial health of the firm. Therefore, such activity is in line with my teaching philosophy which help students to practically engage in the course using free of cost data available to everyone.

By: Dr. Zubair Ali Raja

Problems Exercise

In my class of Advance Corporate Finance, student needs to do exercise problems for each chapter. These problems are available at the following link and students need to use the code given to them by the publisher to access these problems.

https://connect.mheducation.com/class/z-raja-summer-2020

This is an important learning activity as students practice their finance skills taught to them in each chapter by solving these questions. For my students of corporate finance, free resources are also available in the Thompson Rivers University Moodle shell, prepared by Professor Dan Thompson, under the heading of “Open Educational Resource: Business Finance” and given at the following link: https://moodle.tru.ca/course/view.php?id=10042

Providing these interactive problem-solving opportunities are in line with my teaching philosophy as I champion the teaching approach which let my student master finance skills by solving challenging questions. In future, as advised by the “Engage” course, I am determined to open up the discussion on the most challenging question each week and let students discuss how it can be solved and what can be the practical implications of such problems in real-life situation. For example, how mortgage payments are calculated or how to create an amortization table etc.

By: Dr. Zubair Ali Raja

Better Introduction (OTL2 Post 2)

Compare to my post-1 in this course, I need to do a lot of changes in my introduction to enhance my social presence. In my last post I have simply written one line and most of the introduction I have intentionally given in my video to have more views. Now in an actual course I will enhance my social presence in following ways:
• I will talk about my background for example, education, experience, country of origin and
• I will also talk about my hobbies, games I like, any of my adventures, my achievements and future goals.

Further, there are many ways through which I can improve my social presence. In every module, I will post an announcement about the weekly course activities. I will also use informal language to reduce the power distance between me and my students. Now these ideas clearly are not mentioned in my post-1 and suggests a significant change in my thinking to increase my social presence.

Integration (OTL101 Post 5)

I appreciate the efforts of TRU open learning division for making their OLFMs taking these courses as they have provided a lot of insight about how online teaching should be done. I believe that the the most important idea which I am learning from this course is keeping in mind the difference between students’ approaches of deep and surface learning. When designing my course in future I will ensure that every student must take the deep learning approach as the assessments will be designed to meet learning out comes. This is also a very specific smart goal and my strategy will be to assign individual assignments and a class paper so that every student has to think and analyze the problem in hand in my courses.

The concept of teaching styles is also very important and I think that this course made me realize that I am a level 2 teacher who blames himself when students do not perform well. I believed in transmitting the knowledge from my brain to the student’s brain. Now in future my efforts will mostly be in the direction where class activities will be designed in such a way that course outcomes must be achieved in more efficient way. Even though I have been paying emphasize on this but now I will be much more focused on class activities.

Overall this course has made me think that how I can make my course better which was the main aim of taking the “Think” course. In the end I am leaving with curiosity. Whether we can really force a student with surface learning approach to adopt the deep learning approach? Can class activities really forces him to use high level cognitive skills? Obliviously, I will use class activities to do so but will such students really appreciate the efforts or will they overwhelm with higher level cognitive demands of the course.

Feedback (OTL101 Post 4)

First, Hattie’s article provides valuable insight to me as it has given me a new perspective to think about this important construct, the feedback. Undoubtedly, I agree with Hattie that feedback significantly influences the achievement of a student in attaining the learning outcomes.

I believe that to some extend I am actually following Hattie’s recommendations but was not aware exactly what he proposed. The learning gap, where a student is right now and where he meant to be, can be addressed using three question which Hattie suggested was unknown to me. In online teaching environment sometimes, it is sometimes difficult to understand student’s goals, his expertise in the pre-requisite course material, his level of motivation etc. This leads to the situation where customized feedback is very difficult to provide. However, there is always room for improvement and Hattie’s recommendation will help me to improve my feedback in my future online course. I will ensure to provide feedback by keeping in mind the proposed questions like, where students are heading? How are they going? And where they go ahead to achieve the course objectives?

Further, I believe that I need to seek some more introduction from students like what is the purpose of taking the course and what are their expectations from the course. This will help me to provide constructive and more importantly customized feedback to the students.

Constructive Alignment (OTL101 Post 3)

Following are the “Learning Outcomes” of my “Portfolio and Equity Analysis” course and requires high-level of cognitive skills to achieve them.

  1. Evaluate the effect of risk and diversification on investment decisions.
  2. Discuss the characteristics of the various types of investments and the ways in which they are sold.
  3. Defend the use of mutual funds versus investing in individual assets.
  4. Explain the functioning of financial markets and their role in pricing investments.
  5. Compare the efficient market hypothesis with behavioral finance.
  6. Value equities using fundamental analysis and technical analysis.
  7. Analyze a company’s prospects in relation to its industry and peers.
  8. Use the Capital Asset Pricing Model and Asset Pricing Theory to estimate investment returns.
  9. Develop a portfolio management plan reflecting the goals, risk tolerance, and circumstances of individual and institutional investors.

 Students are assessed based on quizzes, exams, class project and presentation. I try to align my assessments with the intended outcome of the course so that their activities should remain inline with my course objectives. For example, the class project is based on the investment in real stocks and other financial instrumented on a platform, StockTrak, which simulates the real-time investment. Likewise, my assessments are based on the student ability to analyze a particular security using available information on the internet and based on security’s characteristics and security’s contribution on his overall investment portfolio.

In line with SOLO taxonomy, I design my quizzes and exams to test that students have higher level of understandings e.g., relational or extended abstract. For example, in one of my quiz I ask my students to solve the following:

“Consider yourself a Wall street analyst. Today your supervisor has assigned you the task to find rate of return on Netflix stock. Consider Market return 9%, calculate Netflix stock beta using the weekly returns from 6 Feb 2017 to 3 Feb 2020. (use up to 2 decimal places to solve the question). Gather missing information from Yahoo finance or other related websites. Given the information the rate of return on Netflix stock is….”

Now if the student will able to solve the above question he will be able to show the highest level of understanding on the topic of “Capital Asset Pricing Model and Asset Pricing Theory to estimate investment returns”, which is the learning outcome number 8 of this course. Likewise, in order to attain the outcome number 7, I give them a detailed analysis of a company to each student and he needs to answer the following question about the company. Answering these questions involve high-level cognitive skills and students’ activity is aligned to attain learning outcome as.

Q1: What is the business, the products, the customers, what is the recent historic economic performance, what are the recent strategic decisions taken the company?

Q2: What are the key success factors and risks associated with the firm’s chosen competitive strategy?

Q3: Does the firm currently have the resources and capabilities to deal with the key success factors and risks?

Q4: Has the firm made irreversible commitments to bridge the gap between its current capabilities and the requirements to achieve its competitive advantage?

Q5: Has the firm structure its activities (such as research and development, design, manufacturing, marketing and distribution and support activities) in a way that is consistent with its competitive strategy?

Q6: Is the company’s competitive advantage sustainable? Are there any barriers that make imitation of the firm’s strategy difficult?

Q 7: Are there any potential changes in the firm’s industry structure (such as new economic conditions, new technologies, foreign competition, changes in regulation, change in customer requirements) that might dispute the firm’s competitive advantage? Is the company flexible enough to address the change?