Arbitrage Assignement Essay
Homework Assignment 1 (revised 9/14/2013)
The attached (end of this file) press release dated 12/16/04 from Symantec (SYMC) describes conditions under which it would acquire Veritas Software (VRTS). Note that will find arbitrage examples and other useful information in the file: “Arb Handouts wo formulas.xlx” on Blackboard.
This assignment has two parts, A and B.
A. Arbitrage Analytical Analysis (spreadsheet required)
This first part requires that you analyze this transaction from an arbitrageur's viewpoint.
Assumptions Related to Part A: make the following assumptions in your analysis:
Assume that you borrow 40% of any funds you need (i.e. you buy on 40% margin)
You pay interest on borrowed …show more content…
The combined company will operate under the Symantec name. John W. Thompson, Chairman and Chief Executive Officer of Symantec, will continue as Chairman and CEO of the combined company. Gary L. Bloom, Chairman, President and Chief Executive Officer of VERITAS, will be ViceChairman and President of the combined company. The board directors of the combined company will include 6 members of Symantec's current board and 4 from VERITAS' current board for a total of 10 members.
"Customers are looking to reduce the complexity and cost of managing their IT infrastructure and drive efficiency with fewer suppliers," said John W. Thompson, Chairman and CEO, Symantec. "The new Symantec will help customers balance the need to both secure their information and make it available, thus ensuring its integrity. We believe that information integrity provides the most costeffective, responsive

Risk Arbitrage Case
1464 Words  6 PagesRisk Arbitrage: Abbott Labs and Alza Harvard Business Review Case Study 1. BACKGROUND Risk Arbitrage is essentially just arbitrage with some element of risk. Three main types of risk arbitrage are merger and acquisition arbitrage (also known as just merger arbitrage), liquidation arbitrage, and pairs trading. We will focus on merger arbitrage, as it pertains to this case study. Merger arbitrage is an investment strategy that chooses to capitalize upon arbitrage that presents when a merger or acquisition…

Ch3Arbitrage and Financial decision making
1516 Words  7 Pages新闻 网页 贴吧 知道 音乐 图片 视频 地图 百科 文库 公司理财3 DOC 全部 首页 百度文库 应用文书 分类 总结/汇报 公司理财3 (2人评价) 公 司理财, 外, 文 课 英  817人阅读 3 PPT TXT 教育文库 PDF 个人认证 百度一下 百度特权  下载客户端  百度首页  登录 注册 帮助 XLS 机构专区 会议中心 开放平台 我的文库 Chapter 3  17次下载  举报文档 Arbitrage and Financial Decision Making 3.1 Valuing Costs and Benefits 1) Which of the following statements regarding the valuing of costs and benefits A) The first step in evaluating a project is to identify its costs and benefits. B) In the absence of competitive…

Essay on Assessment of Potential Arbitrage
797 Words  4 PagesAssessment of Potential Arbitrage Opportunities: Question: 01 The first arbitrage opportunity relates to locational arbitrage. Holt has obtained spot rate quotations from two banks in Thailand: Minzu Bank and Sobat Bank, both located in Bangkok. The bid and ask prices of Thai baht for each bank are displayed in the table below: Minzu Bank Sobat Bank Bid…

TransAtlantic Arbitrage
1393 Words  6 PagesCHAPTER 6 QUESTIONS : 8,13,14,15 QUESTION 8 Akira Numata –UIA Japan Assumptions  Value $  Yen equivalent  Arbitrage funds  5,000,000  593,000,000  Spot Rate (¥/$)  118.60   180days forward Rate  117.80   Expected spot Rate  118.00   180days U.S dollar interest rate  4.80%   180days Japanese Yen Interest Rate  3.400%   Calculations Calculating forward Rate (i= interest rate) F180 sf/$ = S sf/$*1+ (isF*180/360)/ (i$*180/360) =118.60*1+…

Capital Asset Pricing Model and Arbitrage Pricing Theory Essay examples
1240 Words  5 PagesA Chartered Financial Analyst, Jeffrey Bruner, uses the Capital Asset Pricing Model (CAPM) to help identify mispriced securities. However, a consultant suggests Bruner to use Arbitrage Pricing Theory (APT) instead. As the following, it will mention the role of CAPM in the modern portfolio management; to clarify the APT faction and explain the reasons why should Bruner use APT to help identify mispriced securities. In modern portfolio management, the role of Capital Asset Pricing Model (CAPM) is…

Capital Asset Pricing Model and Arbitrage Pricing Theory
3608 Words  14 PagesCapital Asset Pricing Model and Arbitrage Pricing Theory: Capital Asset Pricing Model (CAPM) is an arithmetical theory that describes the relationship between risk and return in a balanced market. The Capital Assets Pricing Model was autonomously and simultaneously developed by William Sharpe, Jan Mossin, and John Litner. The researches of these founders were published in three different and highly respected journal articles between 1964 and 1966. Since its inception, the model has been used in…

arbitrage in the government bond market Essay
1422 Words  6 PagesMGT 409 Case 1: Arbitrage in the Government Market 1. In 1991, major discrepancies in the prices of multiple long maturity US Treasury bonds seemed to appear in the market. An employee of the firm Mercer and Associates, Samantha Thompson, thought of a way to exploit this opportunity in order to take advantage of a positive pricing difference by substituting superior bonds for existing holdings. Thompson created two synthetic bonds that imitated the cash flows of the 8¼ May 0005 bond; one…

International Arbitrage and Interest Rate Parity
983 Words  4 PagesHowever, the market will readjust itself by international arbitrage which is the act of capitalizing on the divergence of misquoted prices by creating a riskless profit. Arbitrage is a strategy that investors use to not have to make an investment which includes no risk or funds being tied to a certain asset. There are three forms of international arbitrage: location arbitrage, triangular arbitrage and covered interest arbitrage. Location arbitrage is a process where a participant of the foreign exchange…

Triangular Arbitrage
5509 Words  23 Pagesand Arbitrage Opportunities 1 2.1 Triangular Arbitrage without Transaction Costs 2 2.2 Triangular Arbitrage with Transaction Costs 2 2.3 Examples 5 3 Triangular Arbitrage Opportunities between Turkish, British and Euro Currencies 7 4 Can Triangular Arbitrage Opportunities Exploited in Real Life? 8 4.1 Artefacts 8 4.2 Slippage in Price Quotes 9 4.3 Stale Quote 9 4.4 Weekend effects and nontrading hours 9 5 Appendix 10 5.1 Spot Rates between 1/10/2007 and 11/01/2006 10 5.2 Triangular Arbitrage Calculations…

Essay on Assignement #3: Teamwork and Motivation
1220 Words  5 PagesAssignement #3: Teamwork and Motivation JACK PENDERGAST Prof. Dr. Bob Nolley BUS 520 Feb.24, 2014 Objective Motivation is the interior and exterior elements that arouse aspiration and drive in an individual to remain constantly involved as well as dedicated to a job, role or subject, or to create a determination to achieve an objective (Business Dictionary, 2013). The focal key concern of a business ought to be its people. They remain the individuals…
More about Arbitrage Assignement Essay

Risk Arbitrage Case
1464 Words  6 Pages 
Ch3Arbitrage and Financial decision making
1516 Words  7 Pages 
Essay on Assessment of Potential Arbitrage
797 Words  4 Pages 
TransAtlantic Arbitrage
1393 Words  6 Pages 
Capital Asset Pricing Model and Arbitrage Pricing Theory Essay examples
1240 Words  5 Pages 
Capital Asset Pricing Model and Arbitrage Pricing Theory
3608 Words  14 Pages 
arbitrage in the government bond market Essay
1422 Words  6 Pages 
International Arbitrage and Interest Rate Parity
983 Words  4 Pages 
Triangular Arbitrage
5509 Words  23 Pages 
Essay on Assignement #3: Teamwork and Motivation
1220 Words  5 Pages