What’s new in the fourth edition
Ordinary shares and extraordinary returns
Dividends and retained earnings
A note of warning – investment and speculation
How well have investors fared in the past?
Pricing – good old supply and demand
A short history of the London Stock Exchange
The Main Market (The Official List)
The Alternative Investment Market
Finding prices and other information
Getting the most out of financial websites
Useful websites for discussion boards
What happens when I buy or sell shares?
An order-driven trading system
The trading system for less liquid shares – SETSqx
Transferring shares without brokers
Part 2 The investment spectrum
Open-ended investment companies
Investment trusts (investment companies)
Useful websites for investment trusts
Investment platforms or supermarkets
Bringing home the significance of high fees
Business angels (informal venture capitalists)
Venture capital and other private equity
Call option holders (call option buyers)
Using share options to reduce risk: hedging
Using options to reduce losses
10 Spread betting, contracts for difference and warrants
Balance sheet (statement of financial position)
Directors’ report and business review
12 Key investment ratios and measures
Performance ratios and measures
Financial health ratios and measures
13 Tricks of the accounting trade
Missing the profits and assets in investee companies
Intensity of rivalry of existing companies
15 The competitive position of the firm
What makes resources extraordinary?
Leveraging resources and over-exploiting them
Part 4 Managing your portfolio
Share buy-backs and special dividends
Tax-efficient charitable gifts
The rules of the takeover game
Useful websites and further reading
Wayward financial services professionals
20 Measuring performance: indices and risk