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Omega Health Foundation

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Omega Health Foundation Paper

Malik Harris

University Of Phoenix

Omega Health Foundation Paper

The application of sound financial decision making and investment positioning is predicated upon a sound understanding of the critical components of how a business in the healthcare market behaves. The relationship between investment fundamentals, company positioning and the action process will facilitate the enabling of the organization to move forward on concrete financial footing. The ability to understand where a company is coming from in terms of a financial standpoint and making changes in the application of what current financial goals may be and calling to action the direction of where the company needs to go completes a skill set a financial manager must have.

Current principles of finance and how they relate to the Omega Health Foundation in relation to their financial strength are as (Guin, None) follows:

1. Risk-Return Tradeoff – This principle demands that the higher or increased level of risk, the high the expected return must produce. Financial advisors must determine the level of risk an organization is willing to assume before investments can be properly executed.

2. Leverage – The simplest way to apply this principle is to magnify earnings that are the direct result of fixed costs. These magnifications can be realized by operational, financial and total or combined leverage.

3. Time Value of Money – Every penny earned or invested has a time value. Omega Health needs to be sure this principle is kept in check.

4. Valuation – Knowing that the current value of an asset is equal to the present value of future cash flows is critical. By understanding the formula of:

Value = Present value of future cash flows

5. Bond Prices vs. Interest rates – Knowing if a bond is the best measure of raising money is critical for continued

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