03 Stem 11 Pasay Genmath q2 w4

Module Code: Pasay-GM11-Q2 –W4-D1
Name: ____________________________________________________ Track/Strand: _______________

Teacher: ___________________________________________________ Grade Level: _______________
DEPARTMENT OF EDUCATION, NATIONAL CAPITAL REGION
SCHOOLS DIVISION OF PASAY CITY
MODULE IN GENERAL MATHEMATICS

Quarter 2 / Week 4 / Day 1
OBJECTIVE: Illustrates stocks and bonds.
YOUR LESSON FOR TODAY:

Illustrating stocks and bonds.
TRY TO DISCOVER!
Practice Exercise 1. Find Me!

Find the words which are involved in the lesson about stocks and bonds.
Find these words:

STOCKS DIVIDEND SHARE STOCKMARKET MARKETVALUE STOCKYIELD PARVALUE
BOND COUPON COUPONRATE PRICE FACEVALUE TERM FAIRPRICE MARKETRATE
If you found all the words asked, CONGRATULATIONS!!! These are the terms which are
involved in STOCKS and BONDS.
STOCKS
Some corporations may raise money for their expansion by issuing stocks. Stocks are shares
in the ownership of the company. Owners of stocks may be considered as part owners of the
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company. There are two types of stocks: common stock and preferred stock. Both will receive
dividends or share of earnings of the company. Dividends are paid first to preferred
shareholders. Stocks can be bought or sold at its current price called the market value. When
a person buys some shares, the person receives a certificate with the corporation’s name,
owner’s name, number of shares and par value per share.
BONDS
Bonds are interest bearing security which promises to pay amount of money on a certain
maturity date as stated in the bond certificate. Unlike the stockholders, bondholders are lenders
to the institution which may be a government or private company. Some bond issuers are the
national government, government agencies, government owned and controlled corporations,
non-bank corporations, banks and multilateral agencies. Bondholders do not vote in the
institution’s annual meeting but the first to claim in the institution’s earnings. On the maturity
date, the bondholders will receive the face amount of the bond. Aside from the face amount
due on the maturity date, the bondholders may receive coupons (payments/interests), usually
done semi-annually, depending on the coupon rate stated in the bond certificate.
Let us find out the meaning of these terms. Come and join me.
EXAMPLE 1
Definition of Terms:
• Stocks –share in the ownership of a company
• Dividend – share in the company’s profit
• Dividend Per Share –ratio of the dividends to the number of shares
• Stock Market –a place where stocks can be bought or sold. The stock market in the
Philippines is governed by the Philippine Stock Exchange (PSE)
• Market Value –the current price of a stock at which it can be sold
• Stock Yield Ratio –ratio of the annual dividend per share and the market value per
share. Also called current stock yield.
• Par Value –the per share amount as stated on the company certificate. Unlike market
value, it is determined by the company and remains stable over time
• Bond – interest-bearing security which promises to pay (1) a stated amount of money
on the maturity date, and (2) regular interest payments called coupons.
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• Coupon –periodic interest payment that the bondholder receives during the time
between purchase date and maturity date; usually received semiannually
• Coupon Rate –the rate per coupon payment period; denoted by r
• Price of a Bond –the price of the bond at purchase time; denoted by P
• Par Value or Face Value - the amount payable on the maturity date; denoted by F.
If P = F, the bond is purchased at par.
If P < F, the bond is purchased at a discount.
If P > F, the bond is purchased at premium.
• Term of a Bond – fixed period of time (in years) at which the bond is redeemable as
stated in the bond certificate; number of years from time of purchase to maturity date.
• Fair Price of a Bond –present value of all cash inflows to the bondholder.
Practice Exercise 2. Who Am I?
1. I am the amount payable on the maturity date; denoted by F. Who am I?
____________
2. I am the price of the bond at purchase time; denoted by P. Who am I? -
___________________
3. I am the rate per coupon payment period; denoted by r. Who am I? -
___________________
4. I am interest-bearing security which promises to pay (1) a stated amount of
money on the maturity date, and (2) regular interest payments called coupons.
Who am I? ___________________
5. I am a place where stocks can be bought or sold. The stock market in the
Philippines is governed by the Philippine Stock Exchange (PSE). Who am I?
__________________
Illustration of Stocks and Bonds
EXAMPLE 2.
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A certain financial institution declared a P30,000,000 dividend for the common stocks.
If there are a total of 700,000 shares of common stock, how much is the dividend per
share?
Given: Total Dividend = P30, 000, 000

Total Shares = 700, 000
Find: Dividend per Share

Dividend per Share = Total Dividend / Total Shares
= 30, 000, 000/ 700, 000
= 42.86
Therefore, the dividend per share is P42.86.
EXAMPLE 3.
Determine the amount of the semi-annual coupon for a bond with a face value of
P300,000 that pays 10%, payable semi-annually for its coupons.
Given: Face Value F = P300, 000
Coupon Rate r = 10%
Find: Amount of the Semi-annual Coupon
Annual coupon amount: 300, 000(0.10) = 30, 000
Semi-annual coupon amount: 30, 000 (1/2) = 15, 000
Thus, the amount of the semi-annual coupon is P15,000.
The coupon rate is used only for computing the coupon amount, usually paid semi-
annually. It is not the rate at which money grows. Instead current market conditions are
reflected by the market rate, and is used to compute the present value of future
payments.
Let’s Sum it up!

STOCKS BONDS
A form of equity financing or raising money A form of debt financing, or raising money
by allowing investors to be part owners of by borrowing from investors
the company
Stock prices vary every day. These prices Investors are guaranteed interest payments
are reported in various media (newspaper, and a return of their money at the maturity
TV, internet, etc). date
Investing in stock involves some uncertainty. Investors still need to consider the
Investors can earn if the stock prices borrower’s credit rating. Bonds issued by the
increase, but they can lose money if the government pose less risk than those by
stock prices decrease or worse, if the companies because the government has
company goes bankrupt guaranteed funding (taxes) from which it can
pay its loans
Higher risk but with possibility of higher Lower risk but lower yield
returns
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Can be appropriate if the investment is for Can be appropriate for retirees (because of
the long term (10 years or more). This can the guaranteed fixed income) or for those
allow investors to wait for stock prices to who need the money soon (because they
increase if ever they go low. cannot aord to take a chance at the stock
market)
PRACTICE EXERCISE: 3
Identify the questions if it involves STOCKS or BONDS.
1. Five years ago, Ms. Morante bought 500 shares of stocks in a certain corporation worth
P48.00 each. Now, each share is worth P60.50.
2. Mr. De Guia bought 1,000 shares of stocks in a corporation that had issued 100,000
shares. This means Mr. De Guia acquired 1% of the total shares.
3. A certain corporation declared to give P100,000,000 dividend to the common
stockholders. If there are 1,000,000 shares, then there will be P100 dividend per share.
4. Ms. Tan bought a 10% bond for P100,000. After 10 years, she receives P100,000 back.
She also receives P100,000(0.10)/2 = P5,000 every six months for 10 years.
5. Mr. Pacheco is offered an 8% bond for P50,000. The bond has a face value of P50,000
with maturity date exactly 5 years from now. He receives P50,000(0.08)/2 = P2,000
every six months for 5 years
EVALUATION:
Multiple Choice: Encircle the letter of the correct answer.
1. What is fixed period of time (in years) at which the bond is redeemable as stated in the
bond certificate, number of years from time of purchase to maturity date.
A. Term of a Bond C. Stocks
B. Fair Price of a Bond D. Dividend
2. What is the share in the ownership of the company?

3. What is the present value of all cash inflows to the bondholder?

4. What is the share in the company’s profit?

5. A certain corporation declared a 3% dividend on a stock with a par value of P500. Mrs.
Perez owns 200 shares of stock with a par value of P500. How much is the dividend
she received?
A. P2,000 C. P3,000
B. P4,000 D. P6,000
Prepared by:
Valerie M. De Guia
Pasay City East High School
References: DepEd General Mathematics Learner’s Material pp. 208-217, DepEd General Mathematics
TG SHS pp. 222-229
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Objective: Distinguishes between stocks and bonds.

• Distinguishing Between Stocks and Bonds.
TRY TO DISCOVER!
Definition of Terms in Relation to Stocks
Stocks – share in the ownership of a company.
Dividend–share in the company’s profit.
Dividend per Share – ratio of the dividends to the number of shares.
Stock Market – a place where stocks can be bought of sold. The stock market in the
Philippines is governed by the Philippine Stock Exchange (PSE).
Market Value – the current price of a stockat which it can be sold
Stock Yield Ratio – ratio of the annual dividend per share and the market value per
share. Also called the current stock yield.
Par Value – the per share amount as atated on the company certificate. Unlike market
value, it is determined by the company and the remains stable over time.
Example 1.
If there are 700,000 shares in the corporation and you owned 40% of the company, how many
shares do you have?
Solution:
The formula to use for this type of problem is,
# 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠 𝑜𝑤𝑛𝑒𝑑
% 𝑜𝑓 𝑜𝑤𝑛𝑒𝑟𝑠ℎ𝑖𝑝 =
𝑡𝑜𝑡𝑎𝑙 𝑠ℎ𝑎𝑟𝑒𝑠
From that formula,
# 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠 𝑜𝑤𝑛𝑒𝑑 = (% 𝑜𝑓 𝑜𝑤𝑛𝑒𝑟𝑠ℎ𝑖𝑝) × (𝑡𝑜𝑡𝑎𝑙 𝑠ℎ𝑎𝑟𝑒𝑠)
So from the problem,
# 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠 𝑜𝑤𝑛𝑒𝑑 = (40%) × (700,000) = 280,000
Therefore, the number of shares is 280,000 shares.
Example 2.
A certain financial institution declared a 𝑃ℎ𝑝 30,000,000 dividend for the common stocks. If there
are a total of 700,000 shares of common stock, how much is the dividend per share?
Given:
𝑡𝑜𝑡𝑎𝑙 𝑑𝑖𝑣𝑖𝑑𝑒𝑛𝑑 = 30,000,000
𝑡𝑜𝑡𝑎𝑙 𝑠ℎ𝑎𝑟𝑒𝑠 = 700,000
Finding the dividend per share,
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Solution:
𝑡𝑜𝑡𝑎𝑙 𝑑𝑖𝑣𝑖𝑑𝑒𝑛𝑑
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑝𝑒𝑟 𝑠ℎ𝑎𝑟𝑒 =
𝑡𝑜𝑡𝑎𝑙 𝑠ℎ𝑎𝑟𝑒𝑠
30,000,000
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑝𝑒𝑟 𝑠ℎ𝑎𝑟𝑒 = = 42.86
700,000
Therefore, the dividend per share is 𝑃ℎ𝑝 42.86.
Example 3.
A certain corporation declared a 2% dividend on a stock with a par value of 𝑃ℎ𝑝 600. Mrs.
Villamor owns 300 shares of stock with a par value of 𝑃ℎ𝑝 600. How much is the dividend she
received?
Given:
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 = 2%
𝑃𝑎𝑟 𝑉𝑎𝑙𝑢𝑒 = 600
𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠 = 300
Solution:
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 = 𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 × 𝑃𝑎𝑟 𝑉𝑎𝑙𝑢𝑒 × 𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑆ℎ𝑎𝑟𝑒𝑠
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 = 2% × 600 × 300 = 3,600
Thus, the dividend is 𝑃ℎ𝑝 3,600.
Example 4.
Mr. Santos bought 300 shares of ABC Corporation with a current market value 𝑃ℎ𝑝 2.00 per
share. After 3 years, the market price of the company is 𝑃ℎ𝑝 3.00 per share. How much is the
money of Mr. Santos 3 years from now?
Solution:
𝑃𝑟𝑒𝑠𝑒𝑛𝑡 𝑉𝑎𝑙𝑢𝑒 = (300 𝑠ℎ𝑎𝑟𝑒𝑠) × (𝑃ℎ𝑝 2.00) = 𝑃ℎ𝑝 600
In three years,
𝐹𝑢𝑡𝑢𝑟𝑒 𝑉𝑎𝑙𝑢𝑒 = (300 𝑠ℎ𝑎𝑟𝑒𝑠) × (𝑃ℎ𝑝 3.00) = 𝑃ℎ𝑝 900
Thus, the future value of money three years from now is 𝑃ℎ𝑝 900.
Example 5.
A corporation with a current market value of 𝑃ℎ𝑝 52, gave a dividend of 𝑃ℎ𝑝 8 per share for its
common stock. Use the stock yield ratio to measure how much dividends shareholders are
getting in relation to the amount invested.
Given:
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑝𝑒𝑟 𝑠ℎ𝑎𝑟𝑒 = 8
𝑀𝑎𝑟𝑘𝑒𝑡 𝑉𝑎𝑙𝑢𝑒 = 52
Solution:
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑝𝑒𝑟 𝑆ℎ𝑎𝑟𝑒
𝑆𝑡𝑜𝑐𝑘 𝑌𝑖𝑒𝑙𝑑 𝑅𝑎𝑡𝑖𝑜 =
𝑀𝑎𝑟𝑘𝑒𝑡 𝑉𝑎𝑙𝑢𝑒
8
𝑆𝑡𝑜𝑐𝑘 𝑌𝑖𝑒𝑙𝑑 𝑅𝑎𝑡𝑖𝑜 = = 0.1538 = 15.38%
52
Thus, the stock yield ratio is 15.38%.
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You can use stock yield ratio to compare two or more investments.
Definition of Terms in Relation to Bonds

Bond – interest-bearing security which promises to pay (1) stated amount of money on
the maturity date, and (2) regular interest payments called coupons
Coupon – periodic interest payment that the bondholder receives during the time
between purchases date and maturity date; usually received semi-annually
Coupon Rate – the rate per coupon payment period; denoted by 𝑟
Price of a Bond – the price of a bond purchase time; denoted by 𝑃
Par Value or Face Value – the amount payable in the maturity date; denoted by 𝐹
If 𝑃 = 𝐹, the bond is purchased at par.

If 𝑃 < 𝐹, the bond is purchased ata discount.
If 𝑃 > 𝐹, the bond is purchased at premium.
Term of a Bond – fixed period of time (in years) at which the bond is redeemable as
stated in the bond certificate; number of years from time of purchase to maturity date
Fair Price of a Bond – present value of all cash inflows to the bondholder
Example 1.
Solve for the amount of the semi-annual coupon for a bond with a face value of 𝑃ℎ𝑝 500,000
which pays 5% convertible semi-annually for its coupons.
Given:
𝐶𝑜𝑢𝑝𝑜𝑛 𝑅𝑎𝑡𝑒, 𝑟 = 5%
𝐹𝑎𝑐𝑒 𝑉𝑎𝑙𝑢𝑒, 𝐹 = 500,000
Find: amount of the semi-annual coupon
Solution:
𝐴𝑛𝑛𝑢𝑎𝑙 𝐶𝑜𝑢𝑝𝑜𝑛 𝐴𝑚𝑜𝑢𝑛𝑡 = 𝐹 × 𝑟
𝐴𝑛𝑛𝑢𝑎𝑙 𝐶𝑜𝑢𝑝𝑜𝑛 𝐴𝑚𝑜𝑢𝑛𝑡 = (500,000) × (5%) = 25,000
Finding the semi-annual coupon amount, divide annual coupon amount by 2.
𝑆𝑒𝑚𝑖 − 𝑎𝑛𝑛𝑢𝑎𝑙 𝐶𝑜𝑢𝑝𝑜𝑛 𝐴𝑚𝑜𝑢𝑛𝑡 = 25,000 ÷ 2 = 12,500
Thus, the semi-annual coupon amount is 𝑃ℎ𝑝 12,500.
Example 2.
A bond has a face value of 𝑃ℎ𝑝 200,000 and its maturity date is 5 years from now. The coupon
rate is 2% payable semi-annually. Find the fair price of this bond, assuming that the annual
market rate is 4%.
Given: 𝐶𝑜𝑢𝑝𝑜𝑛 𝑅𝑎𝑡𝑒, 𝑟 = 6%, payable semi-annually
𝐹𝑎𝑐𝑒 𝑉𝑎𝑙𝑢𝑒, 𝐹 = 200,000 𝑇𝑖𝑚𝑒 𝑡𝑜 𝑚𝑎𝑡𝑢𝑟𝑖𝑡𝑦 = 10
𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑝𝑒𝑟𝑖𝑜𝑑𝑠 = 2(5) = 10
𝑀𝑎𝑟𝑘𝑒𝑡 𝑅𝑎𝑡𝑒 = 4%
Solution:
0.06
𝐴𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝑆𝑒𝑚𝑖 − 𝑎𝑛𝑛𝑢𝑎𝑙 𝑐𝑜𝑢𝑝𝑜𝑛 = (200,000) × ( ) = 6,000
2
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Thus, the bondholder receives 10 payments of 𝑃ℎ𝑝 6,000, and 𝑃ℎ𝑝 200,000 at 𝑡 = 5.
Finding the present value of 𝑃ℎ𝑝 200,000:
𝐹 200,000
𝑃= 𝑛 = = 164,385.42
(1 + 𝑗) (1 + 0.04) 5
Finding the present value of 10 payments at 𝑃ℎ𝑝 6,000 each:
Converting 4% to equivalent semi-annual rate,
2
𝑖2 𝑖2
(1 + 0.04) 1 = (1 + ) → = 0.019804
2 2
Present value of 10 payments at 𝑃ℎ𝑝 6,000 each:
1 − (1 + 𝑗) −𝑛 1 − (1 + 0.019804) −10
𝑃=𝑅 = 6,000 = 53,950.82
𝑗 0.019804
The fair price will be the sum of the present value of 𝑃ℎ𝑝 200,000 and present value of
10 payments at 𝑃ℎ𝑝 6,000 each,
𝑃𝑟𝑖𝑐𝑒 = 164,385.42 + 53,950.82 = 218,336.24
Thus, the fair price is 𝑃ℎ𝑝 218,336.24.
PRACTICE EXERCISE 1: From the pool of words below, determine the terms being described
in each of the following items.
Fair Price Bonds

Buying high and selling low Buying low and selling high
Stock Face Value
__________________1. It is a piece of ownership in a corporation.

__________________2. When you purchase a stock for 𝑃ℎ𝑝 10.00 and then sell it one
month later at 𝑃ℎ𝑝 20.00 you are ___________________.
__________________3. When you receive corporate profits from your ownership of stock,
you are __________________
__________________4. It is the amount payable on the maturity date.
__________________5. They are interest-bearing loans issued either by the government
or corporations which pay out a fixed rate of interest for a specific period of time.
PRACTICE EXERCISE 2:
1. If there are 1,000,000 shares in the corporation and you owned 30% of the company,
how many shares do you have?
2. A certain financial institution declared a 𝑃ℎ𝑝 30,000,000 dividend for the common stocks.
Suppose there are a total of 800,000 shares of common stock, how much is the dividend
per share?
Page 9 of 20

3. A bank declared a dividend of 𝑃ℎ𝑝 30 per share for a common stock. If the common
stock closes at 𝑃ℎ𝑝 87, how large is the stock yield ratio of the investment?
1. Find the amount of the semi-annual 2. What is the amount of a semi-annual

coupon for a 𝑃ℎ𝑝 220,000 bond which coupon for a bond with a face value of
pays 6% convertible semi-annually for its 𝑃ℎ𝑝 50,000 that pays 8% convertible
coupons. semi-annually for its coupons?
EVALUATION: Determine the following in relation to stocks and bonds.

1. A stockholder got 3000 shares of stocks from BB Corporation. The par value
os 𝑃ℎ𝑝 200. How much is the dividend if the percentage is 3%?
2. Ms. Lim purchased 2000 shares of stocks at 𝑃ℎ𝑝 30 par value. How much is the dividend
if the percentage declared by the company is 2%?
3. A businessman delcared a dividend of 𝑃ℎ𝑝 50,000,000 for its common stock. Suppose
there are 250,000 shares of common stock, how much is the dividend per share?
4. Find the amount of the semi-annual coupon for 𝑃ℎ𝑝 10,000 bond which pays 2.5%
convertible semi-annually for its coupons.
5. A bond promises to pay the bondholder equal payments of 𝑃ℎ𝑝 5,000 in six-month
intervals for 20 years. If the face amount is 𝑃ℎ𝑝 500,000, what is the fair price of the
bond. Assume that the market rate is 2% compounded annually.
Prepared by: ADA MAE RUSSEL S. ESPAÑOLA

Special Science Teacher I
Ref erences:
General Mathematics Learner's Module, pag es 208-217
https://www.youtube.com/watch?v=vjOzWXrBGnw&t=737sindex=13
Page 10 of 20



OBJECTIVE:
Describes the different market for stocks and bonds.

• Describing the Different Markets for Stocks and Bonds.
Definition of Terms:
Stocks are issued by corporation or joint-stock companies. It is risky since it

can grow rapidly and fluctuate depending on buying and selling.
Stock Yield Ratio – ratio of the annual dividend per share and the market value per
share. Also called current stock yield.
Bonds are issued by public sector authorities, credit institutions, companies and supranational
institutions. Since a bond is a loan, it is less risky since the bond holders are always paid first.
Dividend – share in the company’s profit
Dividend Per Share – ratio of the dividends to the number of shares
Financial Markets are any marketplace where buyers and sellers are partaking in
trading of assets like equities or stocks, bonds, currencies and derivatives. The bond
market and the stock market are the two most important types of financial markets. Both
stock and bond markets are divided into two sections: primary market and secondary
market.
Primary Market is where the stocks and bond are first issued. It is also known as
new issue market and is facilitated by underwriting groups consisting of investment banks
that will set the starting price range for a certain assets or product and supervise directly
to the investor. The stocks or bond can then be traded on the Secondary Market. This
is where the investor buy assets from another investor.
Stock Market is the place where the participants gather to buy or sell stocks. It is
an important place for trading since it provides the companies an access on the capital,
the investors a glimpse of the possible stocks to buy and see the potential gains based
on the future performance.
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Different Markets for Stocks:

1. The New York Stock Exchange (NYSE)
This is the oldest stock exchange in the United States. It is an auction-
based, wherein specialists in a particular stock are present in the place and
manage in the buying and selling of stocks. This is also considered as the largest
and prestigious exchange. The companies who wanted to be listed here must meet
the initial requirements and comply with maintenance requirement.
2. American Stock Exchange
This is nearly as old as New York Stock Exchange. It is also an auction-
based exchange but is smaller compared to New York Stock Exchange.
3. National Association of Securities Dealers Automated Quotations
Exchange (NASDAQ)
This is an electronic exchange. It is also called as screen-based because
the traders used computer or phone to do the trading. The dealers, also known as
market makers do their own inventory of stocks. They are always ready to buy and
sell Nasdaq stocks but they must post their bid and ask prices. It carries more
companies and trade more shares than the New York Stock Exchange.
4. Electronic Communications Network
This is an alternative trading system that trades NASDAQ stocks. They
connect directly to the buyers and sellers. They are generally good to the
customers since the transaction cost is minimize.
5. Over the Counter (OCT)
This refers to markets that are not included in the above-mentioned
organized market. They are small companies that are delisted from NASDAQ. It
has very few charges, thus some companies deliberately switch to this market.
Two Kinds of Over the Counter Markets
5.1. Bulletin Board Market – an electronic community where there are no
minimum annual sales or assets required to list.
5.2. Pink Sheets – composed of companies that does not need Securities and
Exchange Commission (SEC) registration.
6. Philippine Stock Exchange
This is the corporation that governs our local stock market. It is one of the
oldest stock exchange in the Asia.
Bond Market, also called as debt market is the place wherein the participants are
issued or traded bonds. The bond market is larger than stock market. Its goal is to provide
Page 12 of 20

long-term financial aid and funding for public and private project and expenditures. The
participants include institutional investors, traders, governments and individuals who
purchase products provided by large institutions. This has no central place for trading and
is done through Over The Counter trading.
Activity 1:
Fill in the blanks by identifying which type of market is asked.
1. _________ Markets bring together individuals who want to save money with other
individuals or companies who wish to raise money. The bond market and the stock
market are the two most important types of these markets.
2. The bond and stocks are first issued in the ____________ market which is also
known as _______________ market.
3. _____________ market is where the other investor buy assets from other investor.
The stocks and bond can be traded on this market.
4. _______ Market is the place wherein the participants are issued or traded bonds.
5. _______ Market is an alternative trading system that trades NASDAQ stocks.
6. The participants in the secondary market are either the _________ or ________
of funds.
7. Both stocks and bonds markets are divided into two sections which are the
__________________ and __________________.
Activity 2:
Explain all the different markets for stocks and bonds in your own words using 2-3
sentences.
1. The New York Stock Exchange (NYSE)
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
Page 13 of 20

2. American Stock Exchange

______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
3. National Association of Securities Dealers Automated Quotations Exchange
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
4. Electronic Communications Network

______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
5. Over the Counter (OCT)

______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
6. Philippine Stock Exchange

______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
7. Primary Market
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
8. Secondary Market
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
Page 14 of 20

Activity 3:
Answer the following questions in an essay format: “How will you spend your
money? Will you save it in a bank or invest? Will you apply the markets for
stocks and bonds? If yes, which of the different markets will you apply and why?
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
Learning Summary:
The stock market is a financial market where participants can issue and trade
stocks. The different marks are as follows: The New York Stock Exchange, American
Stock Exchange, National Association of Securities Dealers Automated Quotations
Exchange, Electronic Communications Network, Over the Counter (OCT), and the
Philippine Stock Exchange.
Bond Market is the place wherein the participants are issued or traded bonds.
s broadly segmented into two different silos: the primary market and the
secondary market. The primary market is frequently referred to as the "new
issues" market in which transactions strictly occur directly between the bond issuers
and the bond buyers.
Prepared by: ZEDDY P. BORAL

Pasay City West High School
References for Future Enhancement:

Grade 11 Learner’s Material, pp.208-213
Torio, Von Anthony G. et.al., Smart in Math 11 pp.250-255
https://quickonomics.com/the-difference-between-bond-markets-and-stock-markets/
https://www.investopedia.com/terms/b/bondmarket.asp#:~:text=The%20bond%20market%20is%20broadly,issuers%
20and%20the%20bond%20buyers
https://accountlearning.com/differences-between-bond-market-and-stock-market/
Page 15 of 20


Objective: Analyzes the different markets for stocks and bonds.

In this module, the learners will be able to analyze the different markets for stocks and
bonds.
Vocabulary and Concepts
• A stock market index is a measure of a portion of the stock market.

• Other indices are sector indices, each representing a particular sector (e. g.,
financial institutions, industrial corporations, holding firms, service
corporations, mining/oil, property).
• Bond market index is a measure of a portion of the bond market.
• Rate of income is often called yield.
Reading the Stock Table

Stock indices are reported in the business section of magazines or newspapers, as well
as online (http://www.pse.com.ph/stockMarket/). The following figure shows a list of index
values is typically presented.
Val – value of the index
Chg – change of the index value from

the previous trading day (i. e., value
today minus value yesterday)
%Chg- ratio of Chg to Val (Chg divided

by Val)
𝐂𝐡𝐠
%𝐂𝐡𝐠 =
𝐕𝐚𝐥
So, if you are asked about the value of
Services yesterday, you need to add Val
and Chg. Is it advisable to sell the
stocks if this is the Stock table today?
The value of the Services yesterday is 5,938.95 + 60.45 = 5,999.40 so it is not advisable to sell
right away. You still need to analyze the trend based on the previous table and state of
economy.
Example 1: Complete the table below (values are hypothetical).
Index Val Chg %Chg
PSEi 5,892.25 (1) -1.008
Financials 1,159.23 - 6.20 (2)
Industrial 8,123.25 - 27.45 (3)
Holding firms 6,146.50 - 44.20 (4)
Page 16 of 20
Name: Grade and Section:
Name of Teacher:
Solution:
𝐂𝐡𝐠 𝐂𝐡𝐠
1) %𝐂𝐡𝐠 = 3) %𝐂𝐡𝐠 =
𝐕𝐚𝐥 𝐕𝐚𝐥
𝐂𝐡𝐠 − 𝟐𝟕. 𝟒𝟓
−𝟏. 𝟎𝟎𝟖% = %𝐂𝐡𝐠 =
𝟓, 𝟖𝟗𝟐. 𝟐𝟓 𝟖, 𝟏𝟐𝟑. 𝟐𝟓
Chg = (5,892.25)( −0.01008) %Chg = -0.00338
Chg ≈ 60.30 %Chg = - 0.34%
𝐂𝐡𝐠 𝐂𝐡𝐠
2) %𝐂𝐡𝐠 = 4) %𝐂𝐡𝐠 =
𝐕𝐚𝐥 𝐕𝐚𝐥
−𝟔. 𝟐𝟎 − 44.20
%𝐂𝐡𝐠 = %𝐂𝐡𝐠 =
𝟏, 𝟏𝟓𝟗. 𝟐𝟑 6,146.50
%Chg = -0.00535 %Chg = -0.00719
%Chg = - 0.54% %Chg = - 0.7
Bond Market Indices

Various information about stock prices can be reported. The figure below shows an actual stock
market table published in Philippine Star dated September 3, 2020.
The following table shows how information about stocks can be presented (values are
hypothetical).
52-WK 52-WK
HI LO STOCK HI LO DIV YLD% VOL(100s) CLOSE NETCHG
94 44 AAA 60 35.5 0.70 2.8 2050 57.29 0.10
88 25 BBB 45 32.7 0.28 1.1 10700 45.70 - 0.2
52-WK HI/LO - highest/ lowest selling price of the stock in the past 52 weeks
HI/LO - highest/ lowest selling price of the stock in the last trading day
STOCK- three – letter symbol the company is using for trading
DIV - dividend per share last year
VOL (100s) - number of shares (in hundreds) traded in the last trading day. In this case, stock
AAA sold 2,050 shares of 100 which is equal to 20,500 shares.
CLOSE- closing price on the last trading day
NETCHG - net change between the last two trading days. In the case of AAA, the net change is
0.10. The closing price the day before the last trading day is ₱57.29 - ₱0.10 = ₱57.19.
Page 17 of 20
Name of Teacher:
Example 2: Answer the following questions based on the table presented previously.
For Stocks AAA and BBB:
1. What was the lowest price of the stock for the last 52 weeks?
2. What was the dividend per share last year?
3. What was the annual percentage yield last year?
4. What was the closing price in the last trading day?
5. What was the closing price the day before the last trading day?
Answers:
For Stock AAA:
1. Lowest Price = ₱25.00
2. Dividend per share = ₱ 0.70
3. YLD% = 2.8%
4. Closing Price = ₱ 57.29
5. Closing Price (the day before the last trading day) = ₱57.29 - ₱0.10 = ₱57.19
For Stock BBB:

1. Lowest Price = ₱44.00
2. Dividend per share = ₱ 0.28
3. YLD% = 1.1%
4. Closing Price = ₱ 45.70
5. Closing Price (the day before the last trading day) = ₱45.70 + ₱0.20 = ₱45.90
Buying or Selling Stocks

To buy or sell stocks, one may go to the PSE personally. However, most transactions
nowadays are done by making a phone call to a registered broker or by logging on to a
reputable online trading platform. Those with accounts in online trading platform may often
encounter a table such as the following.
Bid Ask/Offer
Size Price Price Size
122 345,100 21.6000 21.8000 20,000 3
9 71,800 21.5500 21.9000 183,500 1
42 465,200 21.5000 22.1500 5,100 4
2 12,450 21.4500 22.2500 11,800 1
9 14,200 21.4000 22.3000 23,400 6
In the table, the terms mean the following:

• Bid Size - the number of individual buy orders and the total number of shares they wish
to buy.
• Bid Price – the price these buyers are willing to pay for the stock.
• Ask Price – the price the sellers of the stock are willing to sell the stock.
• Ask Size – how many individual sell orders have been placed in the online platform and
the total number of shares these sellers wish to sell.
For example, the first row under the Bid means that there is a total of 122 traders who wish to
buy a total of 345,100 shares at ₱ 21.60 per share. On the other hand, the first row under Ask
means that just one trader is willing to sell his/her 20,000 shares at a price of ₱21.80 per
share.
Page 18 of 20
Name of Teacher:
Bond Market Indices

The main platform for bonds or fixed income securities in the Philippines is the Philippine
dealing and Exchange Corporation (or PDEx). Unlike stock indices which are associated with
virtually every stock market in the world, bond market indices are far less common. In fact,
other than certain regional bond indices which have sub – indices covering the Philippines, our
bond market does not typically compute a bond market index. Instead the market rates
produced from the bond market are interest rates which may be used as benchmarks for other
financial instruments.
Practice Exercise 1: True o False. Write STOCK if the statement is true. Otherwise, write
BOND.
___________ 1.) The main platform for bonds or fixed income securities in the Philippines is
the Philippine dealing and Exchange Corporation (or PDEx).
___________ 2.) To buy or sell stocks, the only ways is go to the PSE personally.
___________ 3.) Stock indices are reported in the business section of magazines or
newspapers, as well as online.
___________ 4.) In fact, other than certain regional bond indices which have sub – indices
covering the Philippines, our bond market typically computes a bond market
index.
___________ 5.) Stock table is the same as bond table.
Complete the table below. Show your solution.
Index Val Chg %Chg

PSEi 5,293.25 (1) -1.008
Financials 2,159.23 - 6.20 (2)
Industrial 9,123.25 - 17.45 (3)
Holding firms 6,156.50 - 4.20 (4)
Property 2,304.89 (5) 2.001
Solution:
1) ___________________
___________________ 4) ___________________
___________________ ___________________
___________________ ___________________
___________________
2) ___________________ ___________________
___________________
___________________
___________________ 5) ___________________
___________________
3) ___________________ ___________________
___________________ ___________________
___________________ ___________________
___________________
Page 19 of 20
Name of Teacher:
Answer the following questions based on the table below.
52-WK 52-WK
HI LO STOCK HI LO DIV YLD% VOL(100s) CLOSE NETCHG
49 23 XXX 60 23.5 0.60 3.8 20050 57.29 -0.10
82 43 YYY 45 42.7 0.18 1.2 1070 45.70 0.25
For Stocks XXX and YYY:
2. What was the dividend per share last year?
3. What was the annual percentage yield last year?
5. What was the closing price the day before the last trading day?
Answers:
For Stock XXX:
1. Lowest Price = _____________
2. Dividend per share = _____________
3. YLD% = _____________
4. Closing Price = _____________
5. Closing Price (the day before the last trading day) = __________________________
For Stock YYY:

6. Lowest Price = _____________
7. Dividend per share = _____________
8. YLD% = _____________
9. Closing Price = _____________
10. Closing Price (the day before the last trading day) = __________________________
EVALUATION
Construct/cut out a stock table from newspaper of PSE website. Then, write your
analysis with the following guide questions:
2. What was the highest price of the stock for the last 52 weeks?
4. What is the current value of the stock?
Thoughts to ponder:
What are the things that are worth risking for? Should you be impulsive when facing problems?
Prepared by:KATRINA J. NALDOZA

Ref erences f or f urther Enhancement: PCNHS – MDC SHS Teacher III
Oronce, O. A. (2016). General Mathematics. Manila: Rex Book Store Inc.
General Mathematics Learner's Module, page 137 - 143
Page 20 of 20

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Module Code: Pasay-GM11-Q2 –W4-D1

Name: ____________________________________________________ Track/Strand: _______________

MODULE IN GENERAL MATHEMATICS

OBJECTIVE: Illustrates stocks and bonds.

YOUR LESSON FOR TODAY:

Practice Exercise 1. Find Me!

Find these words:

involved in STOCKS and BONDS.

Name: ____________________________________________________ Track/Strand: _______________

owner’s name, number of shares and par value per share.

national government, government agencies, government owned and controlled corporations,

• Stocks –share in the ownership of a company

• Dividend – share in the company’s profit

• Dividend Per Share –ratio of the dividends to the number of shares

Philippines is governed by the Philippine Stock Exchange (PSE)

• Market Value –the current price of a stock at which it can be sold

share. Also called current stock yield.

value, it is determined by the company and remains stable over time

Name: ____________________________________________________ Track/Strand: _______________

between purchase date and maturity date; usually received semiannually

• Coupon Rate –the rate per coupon payment period; denoted by r

• Price of a Bond –the price of the bond at purchase time; denoted by P

If P = F, the bond is purchased at par.

If P < F, the bond is purchased at a discount.

If P > F, the bond is purchased at premium.

Practice Exercise 2. Who Am I?

1. I am the amount payable on the maturity date; denoted by F. Who am I?

2. I am the price of the bond at purchase time; denoted by P. Who am I? -

3. I am the rate per coupon payment period; denoted by r. Who am I? -

4. I am interest-bearing security which promises to pay (1) a stated amount of

Philippines is governed by the Philippine Stock Exchange (PSE). Who am I?

Illustration of Stocks and Bonds

Name: ____________________________________________________ Track/Strand: _______________

Given: Total Dividend = P30, 000, 000

Find: Dividend per Share

= 30, 000, 000/ 700, 000

Let’s Sum it up!

Name: ____________________________________________________ Track/Strand: _______________

2. What is the share in the ownership of the company?

3. What is the present value of all cash inflows to the bondholder?

4. What is the share in the company’s profit?

Name: ____________________________________________________ Track/Strand: _______________

DEPARTMENT OF EDUCATION, NATIONAL CAPITAL REGION

MODULE IN GENERAL MATHEMATICS

Objective: Distinguishes between stocks and bonds.

YOUR LESSON FOR TODAY:

Name: ____________________________________________________ Track/Strand: _______________

Name: ____________________________________________________ Track/Strand: _______________

Definition of Terms in Relation to Bonds

If 𝑃 = 𝐹, the bond is purchased at par.

Name: ____________________________________________________ Track/Strand: _______________

Fair Price Bonds

__________________1. It is a piece of ownership in a corporation.

Name: ____________________________________________________ Track/Strand: _______________

1. Find the amount of the semi-annual 2. What is the amount of a semi-annual

EVALUATION: Determine the following in relation to stocks and bonds.

Prepared by: ADA MAE RUSSEL S. ESPAÑOLA

Name: ____________________________________________________ Track/Strand: _______________

DEPARTMENT OF EDUCATION, NATIONAL CAPITAL REGION

MODULE IN GENERAL MATHEMATICS

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _

Name: ______________________________________ Track/Strand: _