Financial Market

FIN 335 Final Project Guidelines and Rubric
Overview
The final project for this course is the creation of a market analysis report.
Whether you are a trader, a research analyst, or a portfolio manager, understanding how domestic and international markets behave and are regulated, along
with the strengths and weaknesses of various financial instruments is key to determining where, how, when, and whether to invest. Such decisions, in turn, affect
individual clients’ choices and collectively can influence how companies are valued and contribute to the overall economic climate. To help aid in the financial
decision-making process, finance professionals often prepare a variety of market analyses geared toward clients and portfolio managers.
For the summative assessment in this course, you will produce a market analysis report that analyzes various organized global and domestic exchange markets
and compares and contrasts performance for different investment products. Your analysis report will give an overview of different markets available (including
non-U.S. markets); discuss the factors that affect market performance (including interest, inflation, and other macroeconomic, social, and political factors); lay
out relevant rules, regulations, and governing bodies for the different markets; analyze the performance of various instruments to assess risks and benefits; and
draw conclusions based on your analysis.
The project is divided into four milestones, which will be submitted at various points throughout the course to scaffold learning and ensure quality final
submissions. These milestones will be submitted in Modules Two, Three, Four and Five. The final submission will occur in Module Seven.
In this assignment, you will demonstrate your mastery of the following course outcomes:
 Assess how macroeconomic forces affect domestic and global market performance for optimizing investment decisions
 Analyze interest rate movements and inflation during various economic periods for their effects on market returns and short- and long-term planning
 Compare and contrast the major financial investment instruments for estimating return-based dividends and capital gains
 Assess the likely risk and return to investors in diverse markets by analyzing common investment products and strategic business decisions
 Determine the relevant oversight bodies and laws governing specific markets for ensuring regulatory compliance
Prompt
Imagine you are a financial analyst at a major investment bank and will soon be working on a project involving a company going public. To help you prepare for
this work and provide coaching for your continued career growth, your supervisor has asked you to choose a company that recently went public and analyze
whether the company made a sound selection for its initial public offering (IPO), as well as other markets it could have considered. (Your instructor should
approve your choice of company early in the course.) Specifically, your supervisor has requested that you prepare a market analysis report laying out the different
markets (including non-U.S. markets); factors that might affect market performance; relevant rules, regulations, and governing bodies; and the risks and benefits
associated with different financial instruments in different markets. Based on your analysis, you will assess whether the company you selected made a sound
choice on which market to enter and why. You will also discuss the role different financial intermediaries played in helping the selected company achieve its goals
and what that might suggest for the upcoming project.
Specifically, the following critical elements must be addressed:
I. Market Overview. This section should provide an overview of the main organized exchanges, both inside and outside the United States, from which the
company you are reviewing could have selected. Note that you do not need to list every exchange, just major exchanges with large market capitalization
to give a sense of the diversity of markets available. In particular, you should briefly:
A. Identify the main features, similarities, and differences in the principal global organized exchanges. For example, what instruments or securities
are traded in the different markets? Are some markets more focused on certain industries or commodities? Are some markets more prestigious
or harder to enter than others?
B. Assess recent performance for the markets you identified in broad terms, focusing on factors that might affect IPO-listing decisions. Support
your response with specific indicators and examples. For example, which markets are performing well? Which are highly volatile? What current
events might impact the markets?
II. Macroeconomic Environment. This section should focus on external factors that can cause markets to move, and how and why those factors influence
performance. You will use this information later in the report to inform your conclusions about the company’s market selection. Specifically, you should:
A. Assess how different economic environments, such as boom and bust cycles, affect markets both individually and collectively. In other words,
consider how economic growth or scarcity affects individual markets and how the economic environment for one market affects others. Support
your answer with examples from different markets and economic periods.
B. Explain how social and political climates can affect market performance, risks, and returns. Use real-world examples from different markets to
support your answer.
C. Analyze how interest rates and inflation affect market performance, using real-world examples from different economic periods to support your
answer. For example, how do interest rates affect business borrowing, personal investment, and lending?
D. Compare and contrast how different types of financial instruments, such as stocks, bonds, mutual funds, and commodities, respond to different
macroeconomic environments, analyzing how that might affect a company’s IPO success. For example, are investors more likely to purchase
shares of a newly listed company in certain contexts more than others? Will the cost of key commodities or services be higher in certain
contexts?
III. Oversight and Governance. Use this section to explain how different markets are regulated, by which agencies, and how that might impact decisions on
which market(s) to list in. You must address:
A. U.S. Exchanges. Select a major U.S. exchange(s) that the company you are reviewing could have considered in making its IPO listing decision. If
the company is listed on a specific U.S. exchange, use that market. Be sure to answer:
1. What rules and regulations do companies wishing to list on this U.S. exchange need to follow and how might that affect listing
decisions? Your answer should focus on basic entry and operation standards, including requirements for non-U.S. companies to trade on
U.S. exchanges, citing relevant sources.
2. How are U.S. market regulations enforced and by which agencies? How might the costs of compliance and consequences of
noncompliance have affected the company’s listing decision? Justify your response.
B. International Exchanges. Select a major non-U.S. exchange(s) that the company you selected could have considered in making its IPO listing
decision. If the company is listed on a specific non-U.S. exchange, use that market. Specifically:
1. How can you determine the rules, regulations, and oversight bodies for this non-U.S. market? In other words, where would you look to
find this information and how would you know to look there? Support your response with concrete examples.
2. What rules and regulations do companies wishing to list on this non-U.S. exchange need to follow and how is compliance enforced? How
might those factors have affected the company’s decision? Your answer should focus on how basic market requirements and compliance
mechanisms are (or are not) different than those for U.S. exchanges, citing relevant sources.
C. Multiple Markets. Analyze whether the selected company should or should not have considered listing its initial public offering (IPO) in more
than one market. Justify your response. For example, can a company legally list in more than one market? If so, under what conditions? What
are the risks and returns for attracting individual and corporate investors?
D. Interest. Analyze how interest rate policies and announcements affect returns and decisions about listing in the two markets you selected.
Provide specific examples to illustrate your answer. For example, how are interest rates determined in U.S. versus non-U.S. markets? How do
governments use interest rate decisions to try to influence the markets under different conditions?
IV. Risks and Returns. Use this section to analyze the risks and returns of different investment instruments in the U.S. and non-U.S. market you selected
above. You may find it helpful to use online brokerage aids or other tools in conducting this analysis. Specifically, address the following:
A. Investment Instruments. Review stock, bond, mutual fund, and commodities performance in the two markets. Be sure to:
1. Analyze investment returns in each of the two markets, including dividend yields, capital gains, prices relative to intrinsic values, and
foreign exchange considerations associated with each of the instruments. Use relevant indicators and visual displays to help present your
findings.
2. Explain what your analysis of returns suggests about each market’s performance and how that might affect decisions on where to list.
Justify your response.
3. Compare and contrast how the different types of instruments move in the two markets over time, explaining the significance of this
information for decisions on where to list. Provide specific examples to support your answer. For example, have certain types of
instruments historically performed better in one market over another? Have certain types of instruments yielded higher returns more
quickly?
4. Assess the risks versus returns associated with the different types of investment instruments in the two markets. How might these tradeoffs affect listing decisions? Support your response with specific examples.
B. Interest and Inflation. Analyze how interest rates and inflation affect different investment instruments and investor decisions. Give specific
examples from the two markets selected to support your answer. For example, how do inflation and interest rates affect stock, bond, and
mutual fund returns in each market? How does that, in turn, affect business and individual short- and long-term investment planning?
C. Taxation. Would tax policies in the two markets make one a better option for IPO listing than the other? Why or why not? Give specific
examples.
V. Conclusions. Use this section to draw conclusions based on your analysis. Specifically:
A. Did the company you selected make a sound choice on which market to list in based on the macroeconomic climate, regulatory environment,
and risks and returns? Might the other market you analyzed have yielded better returns? Justify your response.
B. What role did different financial institutions play in helping the selected company achieve its financial goals, and what might that suggest for
the upcoming project? For example, what criteria should a company use to select and assess the reliability of potential intermediaries?
Milestones
Milestone One: Draft of Market Overview (Section I)
In Module Two, you will submit a draft of the Market Overview (Section I). This milestone will provide an overview of the main organized exchanges, both inside
and outside the United States, which could have been selected by the company you chose to review. You will analyze any similarities, differences, and
performance of selected exchanges. Please note that not every exchange needs to be covered, but rather just major exchanges with large market capitalization to
give a sense of the diversity of markets available. This milestone is graded with the Milestone One Rubric.
Milestone Two: Draft of Macroeconomic Environment (Section II)
In Module Three, you will submit a draft of the Macroeconomic Environment (Section II). This milestone will focus on external factors that can cause markets to
move as well as how and why those factors influence performance. External factors can include economic environments, social and political factors, and interest
rates and inflation. You will also include an analysis of different investment vehicles (stocks, bonds, mutual funds, etc.) in different economic climates. This
information will be used later in the final report to inform your conclusions about the company’s market selection. This milestone is graded with the Milestone
Two Rubric.
Milestone Three: Draft of Oversight and Governance (Section III)
In Module Four, you will submit a draft of Oversight and Governance (Section III). This milestone will explain how different markets are regulated, by which
agencies, and how that might impact decisions on which market(s) to list in. Rules, regulations, and regulators of U.S. and international exchanges should be
explored. In addition, you will research listing in multiple markets and how interest rates may affect one market over another. This milestone is graded with the
Milestone Three Rubric.
Milestone Four: Draft of Risks and Returns (Section IV)
In Module Five, you will submit a draft of Risks and Returns (Section IV). In this milestone, you will analyze the risks and returns of different investment
instruments in the U.S. and non-U.S. markets you selected in Milestone One. You may find it helpful to use online brokerage aids or other tools in conducting this
analysis. Review stock, bond, mutual fund, and commodity performance and their movement over time in these markets. Your analysis should include dividend
yields, capital gains, price relative to intrinsic values, and foreign exchange considerations. Last, you will come to a conclusion about each market’s performance
and access risk versus return when comparing investment vehicles within the different markets. This milestone is graded with the Milestone Four Rubric.
Final Submission: Market Analysis Report
In Module Seven, you will complete the conclusion (Step V) and submit your comprehensive market analysis report. It should be a complete, polished artifact
containing all of the critical elements of the final product. It should reflect the incorporation of feedback gained throughout the course. The final submission will
be graded using the Final Project Rubric.
Deliverables
Milestone Deliverable Module Due Grading
One Draft of Market Overview Two Graded separately; Milestone One Rubric
Two Draft of Macroeconomic Environment Three Graded separately; Milestone Two Rubric
Three Draft of Oversight and Governance Four Graded separately; Milestone Three Rubric
Four Draft of Risks and Returns Five Graded separately; Milestone Four Rubric
Final Submission: Market Analysis Report Seven Graded separately; Final Project Rubric
Final Project Rubric
Guidelines for Submission: Your market analysis report should be 8–10 pages long (not including references or appendixes). It should use double spacing, 12-
point Times New Roman font, and one-inch margins. Use APA formatting for references.
Critical Elements Exemplary (100%) Proficient (85%) Needs Improvement (55%) Not Evident (0%) Value
Market Overview:
Principal Exchanges
Meets “Proficient” criteria and
response is particularly insightful
or nuanced in reflecting the
diversity of markets available
Identifies the main features,
similarities, and differences in
the principal global organized
exchanges
Identifies the main features,
similarities, and differences in
principal global organized
exchanges, but response contains
inaccuracies or omits key details
Does not identify the main
features, similarities, and
differences in the principal
global organized exchanges
3
Market Overview:
Recent Performance
Meets “Proficient” criteria and
assessment, indicators, or
examples demonstrate keen
insight into diverse elements of
market performance that could
affect IPO-listing decisions
Assesses recent performance for
markets identified in broad
terms, focusing on factors that
might affect IPO-listing decisions
and supporting response with
specific indicators and examples
Assesses recent performance for
markets identified, supporting
response with specific indicators
and examples, but response
contains inaccuracies, omits key
details, or indicators and examples
are not relevant
Does not assess recent
performance for markets
identified in broad terms,
supporting response
4.7
Macroeconomic: Boom
and Bust
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or
comprehensive
Assesses how different economic
environments affect markets
both individually and collectively,
supporting answer with concrete
examples from different markets
and economic periods
Assesses how different economic
environments affect markets
individually and collectively,
supported by examples, but
response contains inaccuracies,
omits key details, or examples are
irrelevant or do not cover different
markets and economic periods
Does not assess how different
economic environments affect
markets both individually and
collectively, supported by
examples
4.7
Macroeconomic: Social
and Political
Meets “Proficient” criteria and
analysis or examples are
particularly insightful, nuanced,
or comprehensive
Explains how social and political
climates can affect market
performance, risks, and returns,
using real-world examples from
different markets to support
answer
Explains how social and political
climates can affect market
performance, but does not support
with relevant examples from
different markets, or response
contains inaccuracies or omits key
details
Does not explain how social and
political climates can affect
market performance, risks, and
returns
4.7
Macroeconomic:
Interest Rates
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or
comprehensive
Analyzes how interest rates and
inflation affect market
performance, using real-world
examples from different
economic periods to support
answer
Analyzes how interest rates and
inflation affect market performance,
but does not support with relevant
examples from different economic
periods, or response contains
inaccuracies or omits key details
Does not analyze how interest
rates and inflation affect market
performance
6.26
Macroeconomic:
Financial Instruments
Meets “Proficient” criteria and
response demonstrates
particular insight with respect to
diversity of instruments, their
response to macroeconomic
pressures, and their relation to
IPO success
Compares and contrasts how
different types of financial
instruments respond to different
macroeconomic environments,
analyzing how that might affect a
company’s IPO success
Compares and contrasts financial
instruments’ responses to different
macroeconomic environments, but
does not analyze effect on a
company’s IPO success, or response
contains inaccuracies or omits key
details
Does not compare and contrast
how different types of financial
instruments respond to
different macroeconomic
environments
6.27
Oversight: Rules Meets “Proficient” criteria and
response is particularly well
focused on rules and regulations
salient to listing decisions
Determines how rules and
regulations for listing on U.S.
exchanges affect listing
decisions, focusing on basic
entry and operation standards
and citing relevant sources
Determines how rules and
regulations for listing on U.S.
exchanges affect listing decisions,
but does not focus on basic entry
and operation standards, does not
cite relevant sources, or response
contains inaccuracies or omits key
details
Does not determine how rules
and regulations for listing on
U.S. exchanges affect listing
decisions
4.7
Oversight: Enforced Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or
comprehensive
Determines how U.S. market
compliance mechanisms, costs,
and consequences might affect
listing decision
Determines how U.S. market
compliance mechanisms, costs, and
consequences might affect listing
decision, but response contains
inaccuracies or omits key details
Does not determine how U.S.
market compliance
mechanisms, costs, and
consequences might affect
listing decision
4.7
Oversight:
International:
Determine
Meets “Proficient” criteria and
response is particularly
comprehensive or insightful
Explains how to determine rules,
regulations, and oversight bodies
for non-U.S. markets, supporting
response with concrete
examples
Explains how to determine rules,
regulations, and oversight bodies for
non-U.S. markets, supporting
response with examples, but
response contains inaccuracies,
omits key details, or examples are
not relevant
Does not explain how to
determine rules, regulations,
and oversight bodies for nonU.S. markets, supporting
response with examples
4.7
Oversight:
International:
Regulations
Meets “Proficient” criteria and
response is particularly well
focused on rules and regulations
salient to listing decisions
Determines how parameters for
listing on non-U.S. exchange
affect listing decisions, focusing
on how basic entry and
operation standards are (or are
not) different than for U.S.
exchanges, citing relevant
sources
Determines how parameters for
listing on non-U.S. exchange affect
listing decisions but does not focus
on differences with U.S. exchanges
(or lack thereof), does not cite
relevant sources, or response
contains inaccuracies or omits key
details
Does not determine how
parameters for listing on nonU.S. exchange affect listing
decisions
4.7
Oversight: Multiple
Markets
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or
comprehensive
Analyzes whether the company
should or should not have
considered listing its IPO in more
than one market, justifying
response
Analyzes whether the company
should or should not have
considered listing its IPO in more
than one market, justifying
response, but response contains
inaccuracies, omits key details, or
justification is illogical or irrelevant
Does not analyze whether the
company should or should not
have considered listing its IPO
in more than one market
4.7
Oversight: Interest Meets “Proficient” criteria and
response or examples are
particularly insightful, nuanced,
or comprehensive
Analyzes how interest rate
policies and announcements
affect returns and decisions
about listing in the two markets
selected, providing specific
examples to illustrate answer
Analyzes how interest rate policies
and announcements affect returns
and decisions about listing in the
two markets selected, providing
specific examples, but response
contains inaccuracies or examples
are not relevant
Does not analyze how interest
rate policies and
announcements affect returns
and decisions about listing in
the two markets selected
6.27
Risks and Returns:
Dividend
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or well
supported by high-quality visual
displays
Analyzes dividend yields, capital
gains, prices relative to intrinsic
value, and foreign exchange
considerations associated with
instruments in markets selected,
using relevant indicators and
visual displays
Analyzes specified investment
returns in markets selected but does
not use relevant indicators and
visual displays or analysis is cursory
or contains inaccuracies
Does not analyze specified
investment returns in markets
selected
4.7
Risks and Returns:
Suggest
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or well
supported
Determines what analysis of
returns suggests about each
market’s performance and effect
on listing decisions, justifying
response
Determines what analysis of returns
suggests about each market’s
performance and effect on listing
decisions, justifying response, but
response contains inaccuracies or
omits key details
Does not determine what
analysis of returns suggests
about each market’s
performance and effect on
listing decisions, justifying
response
4.7
Risks and Returns:
Types
Meets “Proficient” criteria and
response provides a nuanced
discussion of connection
between movements of various
instruments and listing decisions
Compares and contrasts
movement of different
instruments over time in
selected markets, explaining
significance for listing decisions
and providing specific examples
Compares and contrasts movement
of different instruments over time,
explaining significance for listing
decisions and providing specific
examples, but response is cursory or
contains inaccuracies, or examples
are not relevant
Does not compare and contrast
movement of different
instruments over time in
selected markets, explaining
significance for listing decisions
4.7
Risks and Returns:
Assess
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or wellsupported
Assesses risks versus returns
trade-offs in selected markets
and how these affect listing
decisions, supporting response
with specific examples
Assesses risks versus returns tradeoffs and how these affect listing
decisions, supported by examples,
but response is cursory or contains
inaccuracies, or examples are not
relevant
Does not assess risks versus
returns trade-offs in selected
markets and how these affect
listing decisions
4.7
Risks and Returns:
Interest and Inflation
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or well
supported
Analyzes how interest rates and
inflation affect different
investment instruments and
investor decisions, supported by
specific examples from two
markets selected
Analyzes how interest rates and
inflation affect different instruments
and investor decisions, supported
by examples, but examples do not
cover both markets, are not
relevant, or response is cursory or
contains inaccuracies
Does not analyze how interest
rates and inflation affect
different investment
instruments and investor
decisions
4.7
Risks and Returns:
Taxation
Meets “Proficient” criteria and
response is particularly
insightful, nuanced, or well
supported
Assesses whether tax policies in
the two markets make one a
better option for IPO listing than
the other, justifying response
with specific examples
Assesses whether tax policies in the
two markets make one a better
option for IPO listing than the other,
justifying response with examples,
but response contains inaccuracies
or omits key details, or examples are
not relevant
Does not assess whether tax
policies in the two markets
make one a better option for
IPO listing than the other,
justifying response with
examples
4.7
Conclusions: Sound
Choice
Meets “Proficient” criteria and
response is particularly
insightful, nuanced or well
supported by analysis
Assesses whether selected
company made a sound choice
on market to list in based on
macroeconomic climate,
regulatory environment, and
risks and returns, and if other
market would yield better
returns, justifying response
Assesses whether selected company
made a sound choice on market to
list in and if other market would
yield better returns, justifying
response, but response is cursory,
contains inaccuracies, or is
inconsistent with analysis presented
Does not assess whether
selected company made a
sound choice on market to list
in and if other market would
yield better results, justifying
response
4.7
Conclusions: Financial
Institutions
Meets “Proficient” criteria and
response demonstrates
especially strong insight into
different institutions’ roles and
the needs of IPO projects
Assesses role different financial
institutions played in helping
selected company achieve its
financial goals and what that
suggests for upcoming project
Assesses role different financial
institutions played in helping
selected company achieve its
financial goals and what that
suggests for upcoming project, but
response contains inaccuracies or
omits key details
Does not assess role different
financial institutions played in
helping selected company
achieve its financial goals and
what that suggests for
upcoming project
4.7
Articulation of
Response
Submission is free of errors
related to citations, grammar,
spelling, syntax, and organization
and is presented in a
professional and easy-to-read
format
Submission has no major errors
related to citations, grammar,
spelling, syntax, or organization
Submission has major errors related
to citations, grammar, spelling,
syntax, or organization that
negatively impact readability and
articulation of main ideas
Submission has critical errors
related to citations, grammar,
spelling, syntax, or organization
that prevent understanding of
ideas
3
Earned Total 100%