SEC 10-K Forms. Where to Start When Learning to Invest!
Introduction There are many people that would love to be involved with investing, but have no idea where to start. One significant problem is distrust of Wall Street professionals stemming from the collapse of Lehman Brothers, large banking firms that made disastrous decisions with mortgage lending that led to the housing market crash, and companies like General Motors who seemingly couldn’t manage their own finances. Few people know someone who made it rich from good investing with even fewer knowing someone that could tell you the tools to be able to get there yourself. When asking someone where to start, the replies should have been, “10-K Forms submitted to the Security Exchange Commission is where to start!” Public companies are required to submit 10-K Forms to the Security Exchange Commission (SEC) on an annual basis that provide company information. These forms include information like what the company does to make money and current state of finances including company stocks. Even though there is specific data required by the SEC, every company doesn’t present their information way, so use of Investopedia or other online resources may be required to learn some of the terminology. The SEC has penalties such as monetary fines and prison sentences in-place as incentives for companies to submit honest reports, so trust issues previously identified shouldn’t be of personal concern. Much more information is contained within 10-K Forms that are beyond the intended scope of this research. Advanced Micro Devices, (AMD), a computer chip manufacturer whose stock is publically traded and their 2010 10-K Form, (AMD, 2011), will be examined to answer three key questions. “What does AMD’s presentation of their financial information say about how they use financial information to inform investors? And, what does AMD 's presentation of their financial information tell about how they use financial information for making decisions internally? What are some facts that
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