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Company Profile:
Legg Mason was incorporated in Maryland in 1981 as a holding company for Legg Mason Wood Walker and other subsidiaries. Legg Mason has grown from a regional firm to a global financial services company and serves: both individual and institutional investors, corporations, high net worth individuals, government entities, endowments and foundations, pension plans, associations, and insurance companies. Headquartered in Baltimore, MD, Legg’s core businesses include: investment advisory services, securities brokerage, and capital markets. ... As of 12/31/02, Legg Mason has $184. ... 1999, Legg Mason has been able to position itself quite well to take advantage of the new “financial services company” which must no longer separate banking, brokerage, insurance, etc. Legg boasts of having one of the largest retail distribution channels in the U. ... One of their flagship mutual funds, Legg Mason Value Trust managed by Bill Miller, has continued to be a success for the company. ...
In a challenging market environment, our goals are to analyze and quantify the effects of different macroeconomic factors on the revenues of Legg Mason.
Dependent Variable:
The dependent variable for Legg Mason is the total revenue for each year during the specified time period (1990-2000). ... A financial services company such as Legg Mason, should be very influenced by GDP growth or decreases. While Legg Mason does have global exposure, much of its revenues are derived from sources in the U. ... ) Consumer Price Index: The next most important factor in our analysis is inflation. ... ) Unemployment Rate: The ability for individuals or institutions to use Legg Mason’s services is dependent upon a certain level of dedication and commitment. ... However as the unemployment rate gets high, it is my belief that fewer and fewer people would be willing to invest their money in many of Legg Mason’s more “long-term” and “speculative” investments. ... ) Mean Household Income: The last variable for our analysis should impact the individual investor the most but also would indicate the overall health of the economy as well; if companies are paying higher salaries, we would generally assume that they are becoming more profitable. ...
Analysis of the Regression Equation and After Study Ranking:
The regression analysis of these variables resulted in an R square of 0. ... This t Stat combined with the P-value figure leads me to believe that while not the most important independent variable, Real GDP is significant in determining the increases or decrease in revenues generated by Legg Mason. ... 53874243, which essentially means that for every one percentage increase of the Real GDP, we would expect revenues at Legg Mason to increase by approx. ... As the GDP either improves or decreases, we would expect a financial services company, whose very business hinges on a healthy economy, to perform in line with the current economic environment and its revenues to follow.
Approximate Word count = 2287
Approximate Pages = 9.1
(250 words per page double spaced)
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