Saturday, January 15, 2011
If you are on a budget, I recommend getting the Pass the 7 textbook and the Pass the 7 ExamCram Online at www.passthe7.com/exams.htm (hit continue shopping, etc.).
If you're not on quite as tight a budget, get the full package at www.passthe7.com/fullpackage.htm. This includes the audio lectures on CD and the DVD set that you can watch on your TV, with the ability to pause, review, fast-forward, etc.
Either way, make sure you learn as many vocabulary terms as possible, and focus on understanding concepts/how things work. You don't get to memorize a bunch of bullet points and merely spit them back at the testing center--the exam forces you to prove you can apply the information you've learned in some pretty creative ways.
So, study hard, everybody. The Series 7 doesn't play.
Which, again, is bad.
Here's a link to an SEC notice that will remind us that while churning is bad, churning and ripping off a convent of nuns is probably even worse. Notice how he not only (allegedly) traded too frequently, but also gouged the sisters (allegedly) with high markups/markdowns.
Wow. As a non-Catholic I can't even guess how many hail mary's this guy will need to say each day for the rest of his life . . . ?
Wednesday, January 5, 2011
While some public companies are massive--WalMart, Microsoft, Apple, American Express--that does not mean that all public companies are either large or even profitable. It also does not mean that private companies are necessarily small. While reading Crain's Chicago Business yesterday, I read a list of the largest private companies in the area. Check out some of the familiar names on this list:
- CDW Corp.
- Ace Hardware Corp.
- True Value Co.
- Follett Corp (college textbooks)
- Solo Cup Co.
- Crate & Barrel
- Culligan International
- Nuveen Investments (closed-end funds, e.g.)
- Mesirow Financial Holdings
How much revenue do these companies make? Mesirow has the lowest among that group, which is still about $467 million a year! Another way to look at is that my office is about 100 yards from a privately held company called Ferrara Pan Candy Co. They make Lemonheads and other famous candies. They also did $322 million in revenue last year, making them only the 89th largest in the Chicago area . . . bigger than the Chicago Bears Football Club Inc. or Safeway Insurance.
Will these companies ever go public? Maybe. Or, maybe they don't need to and/or don't find it worth the hassle of filing registration and listing statements, quarterly and annual reports, etc. In any case, when we talk about "public companies," we simply mean those companies that have accessed the public markets by selling securities to finance their expansion. To make things a littler trickier, many public companies later get taken private again. For example, the Tribune Co. used to be a public company but is now the 10th largest private company in the area after Sam Zell, real estate mogul, put together a complex leveraged buyout. A "buyout" occurs when a group of private investors figures out a way to purchase the shares of a public company, often at a premium to their market price. For example, Zell's Equity Office Properties was a publicly traded REIT of which I owned a few shares . . . but was then taken private in a leveraged buyout.
Oh, I could go on, but this is probably enough excitement for one blog post.