BLOOMBERG POWERPOINT
ASSIGNMENT
By ……
MGMT 225 Business Enterprise Applications, Spring 2020
WHAT ARE THE
BLOOMBERG
TERMINALS
• Created by Michael Bloomberg
• The Bloomberg Terminal is a
computer software system used
by financial professionals
• The Bloomberg Terminals are “A
single platform to give investors
real time access to financial
information simultaneously. This
system provides information what
they need to make well informed
and transparent decisions to
reduce risk”
GETTING STARTED ON THE
TERMINAL WITH FUNCTIONS
Red Stop Keys Yellow Green Action Keys
Escape Market Sector Keys Execute or Confirm Action
Exit Current Function View Different Financial Explore Categories
Markets
Functions are used to help navigate the terminal
GETTING STARTED ON THE TERMINAL
BY MESSAGING
• Bloomberg Messaging allows users
to stay in contact
• Look up other users in the system
• Send an Instant Message or Email
• Share and send analyst data
CORE CONCEPTS
ECONOMIC INDICATORS
• Real GDP growth is correlated with economic health
• Economic growth cycles through growth and decay
• Investors analyze the economy through economic
indications Government
Consumption
Purchases
Investment (Imports – Exports)
GDP
CORE CONCEPTS - ECONOMIC
INDICATORS
Economic Indicators
These Economic Indicators determine economic activity
Economic Business
Inflation
Growth
Unemployment Housing
Confidence
Analysts forecast these Indicators that arrive
GDP arrives too late for
economic indicators first receive the most
Investing
attention
CORE CONCEPTS - CURRENCIES
CURRENCY MARKET CURRENCY VALUATION
MECHANICS DRIVERS
• Trillions of currencies are traded • Value of currencies are relative
everyday • Long run Law of one price
• Countries pegged currencies other • Short run drivers of currency valuation:
currencies for their exchange rate
• Surprise changes in interest rates
• Floating currencies fluctuate
• Surprise changes in inflation
• The USD is the most traded currency
• Surprise changes in trade
CORE CONCEPTS - CURRENCIES
CENTRAL BANKS AND CURRENCY RISK
CURRENCIES
• Control short term interest rates • History of rapid changes
• Effect inflation • Currency movements
• Natural market flows • Paper currencies are valued by
confidence
• Standard inflation should be
around 2% • Gold has retained its value
CORE CONCEPTS - FIXED INCOME
• Fixed Income Market is also known as the Bond • Investors compare bonds by using yields
Market
• Bond yield is the interest rate
• Called fixed income because the repayment
• Factors include
amounts, and times are fixed
• Creditworthiness of borrower
• $100 Trillion World Bond Market
• Inflation
• U.S. government bonds are considered the safest
bonds • Short-term interest rates
• Short-term borrowing is cheaper and riskier than
long-term borrowing
CORE CONCEPTS - FIXED INCOME
• Central banks can control inflation through interest rates
• Investors are wary of high inflation
• High inflation means lower returns
• The yield curve represents the cost of borrowing for loan lengths
• Yields of developed economies are correlated with a global impact
Yield Curve Signals
Steep Improvement
Flat Worsening
Inverted Recession
CORE CONCEPTS -
EQUITIES
• Shareholders own shares of company
earnings and assets
• Stocks and earnings are volatile
• The most shareholders can lose is 100% • An equity is an entitlement to future cashflows
of their investment • IPOs can raise money and transfer ownership
• Shareholders can earn more than 100%
• Companies are off the stock market because
on their investment
• Bought
• Bankrupt
• Large Responsibility
• Indices are baskets of stocks
CORE CONCEPTS - EQUITIES
• Equity Research • Absolute Valuation
• Find what industries a company operates in • Theory that has practical limitations
• Estimates are central to company financial • Discount future cash flows
model
• How well do you think the company will perform
• Formulate earning estimate
• Relative Valuation
• Assess company results by comparing to
estimates • Quick and easy comparison of valuations
• Led by state of the economy
• Earnings and multiples are used to estimate share prices
PORTFOLIO MANAGEMENT
• Defining Portfolio Managers • Building an Equity Portfolio
• Portfolio managers invests for others • Multi-factor scoring models ranks
• Active managers aim to beat the market companies on multiple criteria at once
• Passive managers match it • Portfolio positions
• Portfolio managers must operate from • Fixed weight are at a fixed
skill percentage of portfolio value total
• Managers invest in • Driving weight change in response
to changing prices
• Value
• Shares and par amount positions are
Growth the number of shares held
GARP stocks
PORTFOLIO MANAGEMENT
• Analyze a Portfolio • Assessing Portfolio Risk
• Portfolio managers use these PORT • Balance risk and return
tabs to analyze their portfolios • Use PORT screen to assess risk
• Holdings • Volatility shows how far a return is from
benchmark return
• Characteristics
• VaR calculates how much money can be lost
• Performance
• Scenarios show portfolio performances in
• Attribution changes
• Intraday
• Portfolio managers use these for
adjustments
CONCLUSION
• Bloomberg Terminals are necessary to understand the financial world
• Finances are efficient and easy to understand with the terminals
• Take advantage of Bloomberg portfolio management and Bloomberg
messaging
REFERENCES
• Staff, Investopedia. “Beginner's Guide to the Bloomberg Terminal.”
Investopedia, Investopedia, 15 Mar. 2020, www.investopedia.com/articles/
professionaleducation/11/bloomberg-terminal.asp.
• The Terminal Bloomberg Professional Services. (n.d.). Retrieved from
https://www.bloomberg.com/professional/solution/bloomberg- terminal/
