Three Reasons to Own Ares Capital - Assignment Example

Three Reasons To Own Ares Capital Overview of stock market Stock market is a place where shares are bought and sold. The stocks of publically listed companies are traded. These shares are mostly issued by companies as a way to raise capital. This raised capital is consumed to finance mostly its long term business needs. For examples, with such finance, a company can buy a new factory plant, machinery or any other sort of investment that can generate future cash flows for the company. Certain corporate activities influence the share prices. For example, company’s current financial position and financial performance, its current level of liquidity and its current outstanding long term liabilities are those fundamental factors that influence on the share prices. Mostly, these factors are highlighted in the company’s annually issued financial statements. However, certain other factors have direct or indirect either significant or minor impact over the aggregate performance of shares in stock markets. For example, discount rates, interest rates, political situation, monetary and fiscal policy are among those leading factors that leave a considerable influence over the aggregate performance of stock markets. An overview of writing types of audiences’ variety Three types of writing serve the various stakeholders in the stock markets: informative, instructive and analytical. In the informative type of writing, an author defines certain terms relating to the field of stock markets. Besides explaining, the author tries to elaborate its current and possible implications in different situations. Most of the time, such informative writing is carried out because of being a highly technical field in the structure of finance. Many shareholders and other members of stock markets are not sufficiently equipped with the understanding of basic terms and their meanings. By explaining such type of terms, the author attempts to make audience informative and members working inside the stock markets. Also, an instructive writing helps new and existing institutional and non-institutional shareholders, brokers, and other members of the stock exchange. In this type of writing, an author, who is mostly experienced expert on the topic, provides some suggestions and instructions over the trend of a particular stock. In the instructive writing, shareholders are asked to either follow a certain steps or they are given some other choices to make in order to remain a successful shareholder. Due to the complex functionality of stock prices and involvement of various internal and external factors affecting the share prices, shareholders prefer to follow the instructions provided by professional experts on a given stock. Furthermore, the analytical writing is the most challenging area in comparison with other sorts of above mentioned writing. Among other factors, the most significant factor, adding more challenge, is the use of complex trends and patterns in the entire process of writing an analytical piece. Such use of complex patterns in the stocks can only be understood by those stock holders who are well conversant with the basic knowledge of that particular stock. For other members, the analytical piece of writing would be of less use as its content are filled with the complex and deeper understanding of certain patterns. Additionally, various audiences such as institutional and non-institutional investors, shareholders, stockbrokers, regulators, finance students, management of companies, may require using such writing types to serve their respective objectives. An in-depth analysis of article: Three Reasons To Own Ares Capital Use of language in this community Use of language depends on the ultimate objectives of an author. She tries to convey her own convictions, beliefs, understanding, reasons and knowledge obtained via her personal experiences are those factors that directly influence on the objectives of the author. If she beliefs that a particular company has lucrative business ahead. In order to validate this claim, she uses informative and analytical information. She would try to bring every single piece of evidence that can authenticate her side of version. Aggregately, it all depends on the objectives of the members. And such objectives use appropriate sort of language. Purpose of article 3 Reasons To Own Ares Capital an article written by Will Ashworth (Ashworth, 2011). Basically, this article is consisted of at least five paragraphs. Each paragraph has different sort of information. In the first paragraph, Ashworth tries to give some information about this company-Ares Capital. For example, the author maintains that Ares is one of the largest specialty finance companies in United States of America (Ashworth, 2011). He informs the readers about the company. In the second paragraph-Good Dividend- Ashworth has provided an analysis over the company’s performance. For example, Ashworth initiates second paragraph by saying that currently the 10-year U.S. Treasury note pays around 3.13% annual interest. And, in the next line, he maintains that currently income investors require more annual interest. In the subsequent part of this paragraph, Ashworth further analysis these statements by taking some example from the financial history of the Ares Capital. Audience of this article: Capital investors are the people who are being addressed by Ashworth in the article- both individual as well as institutional investors and other fund managers who are directly or indirectly involved in the sale and purchase of stocks. Various reasons can authenticate this fact. First, three out of five paragraphs-Good Dividend; Size and Strength and Excellent Performance- are filled with the analytical information of Ares Capital. Most of the time, analytical information can only be properly understood by the person who is well conversant with the related field. Additionally, this analysis can only be understood by the person who work and deal in that particular industry such as capital investment and capital management. Such analytical information is almost useless for anyone who is not associated with it. Thesis of the article: The last paragraph-Bottom line- is the main theme. Ashworth in this paragraph provides his recommendations over Ares Capital. He contends that capital investment in Ares Capital is going to be a lucrative way to earn more yields. He authenticates this claim by providing the basic information such as an 8% dividend yield, remarkable performance of Ares Capital to the S%P , and the conservative and experience management of Ares Capital are those factors that makes Ares Capital a lucrative investment opportunity. References Ashworth, W. (2011). Three Reasons To Own Ares Capital. Web. Available at: http://stocks.investopedia.com/stock-analysis/2011/3-Reasons-To-Own-Ares-Capital-ARCC-ACAS-AINV-SLRC-BKCC-BAH0519.aspx [accessed on 21 May, 2011]. Read More