Financial investments

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Introduction

Actuality of the research.Attraction and effective use of foreign investments into economy of RK is a basis, one of the directions of mutually beneficial economic cooperation between the countries. By means of foreign investments it is possible to improve really deformed production structure of economy of Kazakhstan, to create new high-tech productions, to modernize fixed assets and technically to weapon many enterprises, to train experts and workers, to introduce the advanced achievements of management, marketing and a know-how, to fill domestic market with qualitative goods of a domestic production with simultaneous increase in volumes of export to foreign countries. Attraction of foreign investments into economy of Kazakhstan is objectively necessary process. World experience of many countries testifies that inflow of the foreign capital and state regulation of its use positively influence economy. Investments promote formation and strengthening of private business in the countries with average and low levels of economic development, will mobilize the capital for implementation of serious projects, creation of the mixed companies, the markets of the loan capital. From that, how successfully the economy of Kazakhstan will be integrated into world economic communications, strategy and tactics of increase of efficiency of economy of the republic depends. For Kazakhstan the most expedient and painless, from the point of view of influence on inflation and an external debt, is attraction of direct foreign investments as direct investments, being attracted under own guarantees of borrowers, reduce financial obligations of the state for loan of funds for structuration of economy. The economic reform which are carried out in Kazakhstan significantly changed a legal, financial and economic and social status of the main link of a national economy - a enterprise, its status in system of an economic and civil circulation. Instead of prevailing earlier in all branches of an economic of the enterprises founded on state ownership thousands of enterprises which are based on private, mixed of a joint-stock property arose and function. All this influenced change of the mechanism of management and organization of investment activity as bases of economic growth, increase of competitiveness of the organizations and economy in general.

The state Republic of Kazakhstan has to act as the organizer of investment process and the main investor. It is its main function from the point of view of social policy.

The term paper is devoted to a problem, actual for the developing economy, - investment policy of the state and activity.

The purpose of this term paper is to consider structure of investments, to reveal problems and to offer prospects of investment policy in RK.

On the basis of a goal problems of work are:

1) to open general characteristic of financial investments;

2) to analyze Program on attraction of investments;

3) to present prospects of investment activity of RK.

The object of the study is “Program on attraction of investments, development of special economic zones and export promotion in the Republic of Kazakhstan for 2010 - 2014 years”.

The subject of the study is analysis of program's work.

Structure of term paper. The structure of the term paper reflects the logic and the order of solving tasks. This term paper consists of introduction, four main parts, conclusion, list of references, and appendices. The volume of the term paper is 44 pages, including 9 tables and 6 figures.



1. General characteristic of financial investments

Concept and types of financial investments

The concept an investment occurred from Latin “investire” to dress. During a feudalism era input of the vassal in possession of the feud was called as investiture. The same word designated appointment of the bishops receiving thus in management church lands with their population and the right vessels over them. Introduction in a position was accompanied by the corresponding ceremony of vestments and investment with powers. The investiture gave the chance to an investor (or, speaking to the modern language, to the investor) not only to attach to itself new territories for receiving access to their resources, but also to participate in management of these territories through the protйgйs invested with authority for the purpose of planting of the ideology. The last, on the one hand, justified intensive operation of the population of territories and allowed to increase income gained from these territories, and on the other hand, acted as a developing factor.

Financial investments is a purchase by subjects of managing and individuals of securities of various issuers. In this case the capital inflow to business occurs through investment of means in securities. Financial investments are considered as an active form of effective use of temporarily disposable capital or as the instrument of implementation of the strategic objectives connected with diversification of operating activity of the entity.

Classification of financial investments.

Investments are understood as money, target bank deposits, shares, actions and other securities, technologies, cars, the equipment, licenses, including on trademarks, the credits, any other property or property rights, the intellectual values put in objects of enterprise and other kinds of activity for receiving profit (income) and achievement of positive social effect. And under investment activity, according to the law, began to understand any form of capital investments.

Classification of investments concerning object of the appendix, nature of use and time factor.

Concerning object of the appendix: investments into property (material investments). As material investments understand investments which directly participate in production (for example, investments into the equipment, buildings, stocks of materials).

Financial investments -- investments in financial property, acquisition of the rights for participation in affairs of other firms and the business rights (for example, acquisition of actions, other securities).

Non-material investments -- investments into non-material values (for example, investments into training, researches and development, advertising, etc.).

It is represented that all investments concerning object of the appendix (namely this criterion is most interesting) can be divided into two look: portfolio and real, where:

Figure 1 - Types of financial investment

Note - Done by author based on [1]

The portfolio -- investments in securities for the purpose of the subsequent game on a change of course and (or) obtaining the dividend, and also participation in management of the managing subject.

Formation of a portfolio happens by acquisition of securities and other assets. Portfolio - set of the aggregated various investment values serving as the tool for achievement of the specific investment goal of the investor. The portfolio can include securities of one type (action) or various investment values (actions, bonds, savings and deposit certificates, mortgage certificates, insurance policies, etc.).

Direct (real) investments - investments - investments of private firm or the state in production of any production.

Real investments consist of two various components. The first of them are investments into fixed capital, that is acquisition of again made capital benefits, such as the production equipment, computers and buildings of production appointment. The second component - investments into inventory holdings (working capital) which represent accumulation of stocks of the raw materials which is subject to use in production, or unrealized final goods. Commercial inventory holdings are considered as a component of the total value of stocks of the capital in economic system; they are so necessary, as well as the capital in the form of the equipment, buildings of production appointment.

Also real investments can be divided on internal and external:

the internal -- this investment of capital of the managing subject in own factors of production at the expense of own sources of financing;

the external -- this investment of capital of investment institutes in factors of the production needing investments of the managing subject.

It makes sense to refer to real investments also concepts gross and pure investments. Actually pure investments it is gross investments minus costs for compensation of fixed capital.

On nature of use:

primary investments, or net - the investments which are carried out at the basis or upon purchase of the enterprise; investments on expansion (extensive investments), directed on expansion of production potential;

reinvestments, i.e. use of the free income gained as a result of implementation of the investment project, by their direction on acquisition or preparation of new means of production for the purpose of maintenance of structure of fixed assets of the enterprise;

investments on replacement as a result of which the available equipment is replaced with the new;

investments on the rationalization, directed on modernization of processing equipment or technological processes;

investments on change of the program of output;

investments on the diversification, the listed products connected with change, creation of new types of production and the organization of new sales markets;

investments at providing a survival of the enterprise in the long term, aimed at research and development, training, advertising, environmental protection;

gross - the investments consisting from net - investments and reinvestments.

Risk investments, or the venture capital - investments in the form of issue of the new stocks, made in the new fields of activity connected with big risk. Venture capital is invested in untied among themselves projects counting on fast payback of invested funds. Such capital investments are, as a rule, carried out by acquisition of part of actions of the enterprise client or providing loans to it, including with the right of conversion of the last in an action. Risk capital investments are caused by need of financing of small innovative firms for areas of new technologies. The risk capital combines various appendix forms of the capital: loan, joint-stock, enterprise. It mediates in a founder of starting knowledge-intensive firms.

On time factor:

Short-term :investments are assets which the enterprise owns for the purpose of generation of profit through income distribution as, for example, interest income or dividends on investments. Short-term investments also call temporary investments; they can consist of securities or other investments which estimated maturity date makes less than one year.

Long-term investments :as a rule, consist of securities of other companies acquired for the purpose of providing a constant source of the income for the investor for more than one year. The section of long-term investments in balance doesn't join the securities acquired for short-term operations because the established period of repayment makes them the period less than one. Real long-term investments are financial investments in business, i.e. in fixed assets, buildings, constructions, the equipment, the earth, etc.

Annuity :the investments which are bringing in to the investor the certain income through regular periods. Generally it investments of capital in pension and insurance funds. Insurance companies and pension funds issue debts which their owners want to use on a covering of contingencies in the future.

Financial investment is carried out by the enterprise in the following main forms (Figure 2).

Figure 2 - The main forms of financial investment

Note - Done by author based on [2]

1. Capital investments in authorized capitals of joint ventures. This form of financial investment has the most close connection with operating activities of the enterprise. It provides consolidation of strategic economic communications with suppliers of raw materials and materials (with participation in their authorized capital); development of the production infrastructure (at capital investments in transport and other similar enterprises); expansion of opportunities of sale of production or penetration on other regional markets (by capital investments in authorized capitals of trade enterprises); various forms of branch and commodity diversification of operating activities and other strategic directions of development of the enterprise. According to the contents this form of financial investment in many respects substitutes real investment, being thus less capital-intensive and quicker. The priority purpose of this form of investment is not so much receiving high investment profit (though minimum its necessary level has to be provided), how many establishment of forms of financial influence on the enterprises for ensuring stable formation of the operating profit.

2. Capital investments in profitable types of monetary instruments. This form of financial investment is directed first of all on effective use of temporarily free monetary assets of the enterprise. Main type of monetary instruments of investment is the deposit contribution in commercial banks. As a rule, this form is used for short-term investment of the capital and its main goal is generation of investment profit.

3. Capital investments in profitable types of share tools. This form of financial investments is the most mass and perspective. It is characterized by capital investments in different types of the securities which are freely traded on the stock market (so-called "market securities"). Use of this form of financial investment is connected with a wide choice of alternative investment decisions both on instruments of investment, and on its terms; higher level of state regulation and security of investments; the developed infrastructure of stock market; existence of quickly provided information on a state and environment of stock market in a section of its separate segments and other factors. Main objective of this form of financial investment also is generation of investment profit though in some cases it can be used for establishment of forms of financial influence on the separate companies at the solution of strategic tasks (by acquisition of the control or sufficient powerful equity stake).

1.2 Features of financial investments management

Taking into account features and forms of financial investment management by it at the enterprise will be organized.

Management of financial investments of the enterprise represents system of the principles and methods of providing a choice of the most effective financial instruments of capital investments and its timely reinvestment.

Management of financial investments is subordinated to the general investment policy of the enterprise and directed on achievement of its investment purposes.

Management of financial investments of the enterprise is carried out on the following main stages:

Figure 3

Note - Done by author based on [2]

1.The analysis of financial investment condition in the previous period. Main objective of carrying out such analysis is studying of tendencies of dynamics of scales, forms and efficiency of financial investment at the enterprise in a retrospective.

At the first stage of the analysis the total amount of investment of the capital in financial assets is studied, rates of change of this volume and specific weight of financial investment in a total amount of investments of the enterprise in preplanning period are defined.

At the second stage of the analysis the main forms of financial investment, their ratio, an orientation on the solution of strategic problems of development of the enterprise are investigated.

At the third stage of the analysis the structure of concrete financial instruments of investment, their loudspeaker and specific weight in a total amount of financial investment is studied.

At the fourth stage of the analysis level of profitability of separate financial instruments and financial investments as a whole is estimated. It decides as the relation of the sum of income gained in different forms on separate financial instruments (on its adjustment on an inflation index), to the sum of the means invested in them. Level of profitability of financial investments of the enterprise is compared with the average level of profitability in the financial market and level of profitability of own capital.

At the fifth stage of the analysis the risk level of separate financial instruments of investment and their portfolio as a whole is estimated. Such assessment is carried out by calculation of coefficient of a variation of gained investment income for a number of the previous reporting periods. The calculated risk level is compared with level of profitability of an investment portfolio and separate financial instruments of investment (compliance of these indicators to a market scale "profitability risk").

At the sixth stage of the analysis level of liquidity of separate financial instruments of investment and their portfolio as a whole is estimated. The assessment of this indicator is made on the basis of calculation of coefficient of liquidity of investments for date of carrying out the analysis (in the last reporting period). The calculated level of liquidity is compared with level of profitability of an investment portfolio and separate financial instruments of investment.

The carried-out analysis allows to estimate the volume and efficiency of a portfolio of financial investments of the enterprise in the previous period.

2.Defining of financial investment volume in the forthcoming period.

This volume at the enterprises which aren't institutional investors, usually small and is defined by the size of the available financial means presorted for implementation of the forthcoming real investments or other expenses of future period. Borrowed funds to financial investment of the enterprise usually aren't raised (except for the separate periods when level of profitability of securities significantly surpasses level of a rate of percent for the credit).

A certain volume of financial investment is differentiated in a section long and the short-term periods of its implementation. The volume of long-term financial investment is defined in the course of the solution of problems of effective use of investment resources for implementation of real investment projects, the insurance and other trust funds of the enterprise formed on a long-term basis. Volume of short-term financial investment is defined in the course of the solution of problems of effective use of temporarily free rest of monetary assets (as a part of working capital of the enterprise), formation of positive and negative cash flows formed in connection with unevenness.

3.Choice of financial investmentforms. Within the planned volume of the financial funds allocated for these purposes, the concrete forms of this investment considered above are defined. The choice of these forms depends on character of the tasks solved by the enterprise in the course of the economic activity.

The solution of strategic problems of development of operating activities is connected with a choice of such forms of financial investment, as capital investments in authorized capitals of joint ventures and acquisition of a controlling stake of the separate companies representing strategic interest for diversification of this activity.

The solution of problems of a gain of the capital in long-term the period is connected, as a rule, with its investments in the long-term share and monetary instruments which predicted profitability taking into account a risk level satisfies the investor.

The solution of problems of obtaining the current income and anti-inflationary protection of temporarily free monetary assets is connected, as a rule, with a choice of short-term monetary or debt share instruments of investment, real which level of profitability isn't lower than the developed rate of return on the invested capital (the corresponding scale "profitability risk").

4.Assessment of investment qualities of separate financial instruments.

Methods of such assessment are differentiated depending on types of these tools; as the main indicator of an assessment level of their profitability, risk and liquidity acts. In the course of an assessment the factors defining investment qualities of different types of financial instruments of investment -- actions, bonds, deposit deposits in commercial banks, etc. are in detail investigated. In system of such analysis the assessment of investment appeal of branches of economy and regions of the country in which this or that issuer of securities carries out the economic activity receive reflection. An important role in the course of an assessment is played also by character of the address of these or those financial instruments of investment in the organized and unorganized investment market.

5.Formingof financial investments portfolio. This formation is carried out taking into account an assessment of investment qualities of separate financial instruments. In the course of their selection in a formed portfolio the following major factors are considered: type of a portfolio of the financial investments, formed according to its priority purpose; need of diversification of financial instruments of a portfolio; need of ensuring high liquidity of a portfolio and others. The special part in formation of a portfolio of financial investments is assigned to ensuring compliance of the purposes of its formation to strategic objectives of investment activity as a whole.

The portfolio of financial investments created taking into account stated factors has to be estimated on a ratio of level of profitability, risk and liquidity to be convinced that in the parameters it corresponds to that type of a portfolio which is determined by the purposes of its formation. In need of strengthening of focus of a portfolio in it necessary amendments are introduced.

6.Ensuring effective operational management of financial investments portfolios. At essential changes of an environment of the financial market investment qualities of separate financial instruments decrease. In the course of operational management of a portfolio of financial investments its timely restructuring for the purpose of maintenance of target parameters of its initial formation is provided.

Thus, in the course of implementation of management by financial investments key parameters of investment activity of the enterprise in this sphere and its major criteria are defined.

1.3Models of estimation of cost of financial instruments of investment

Efficiency of separate financial instruments of investment, as well as real investments, is determined on the basis of comparison of volume of investment expenses, on the one hand, and the sums of a returnable cash flow by them, with another. At the same time, formation of these indicators in the conditions of financial investment has essential distinctive features.

First of all, in the sum of a returnable cash flow at financial investment there is no indicator of depreciation charges as financial instruments, unlike real investments, don't contain in the structure of depreciable assets. Therefore the basis of the current returnable cash flow on financial instruments of investment is made by the sums of percent periodically paid on them (on deposits to authorized capitals; on deposit deposits in banks; on bonds and other debt securities) and dividends (on stocks and other share securities).

Besides, so far as financial assets of the enterprise (what financial instruments of investment are) won't be amortized, they are on sale (are repaid) at the end of the term of their use by the enterprise (or at the end of the caused fixed term of their address) at that price which developed on them at the time of sale in the financial market (or on in advance caused fixed their sum). Therefore, the cost of their realization is a part of a returnable cash flow on financial instruments of investment upon termination of the term of their use (the fixed cost on debt financial assets and the current course cost on share financial assets).

Certain differences develop and in formation of rate of return on the invested capital. If on real investments this indicator show level of the forthcoming operating profit which develops in the conditions of objectively existing branch restrictions, on financial investments the investor himself chooses the expected rate of return taking into account a risk level of investments in various financial instruments. Careful (or conservative) the investor will prefer a choice of financial instruments with a low risk level (and respectively and with low norm of investment profit) while risky (or aggressive) the investor will prefer a choice for investment of financial instruments with high norm of investment profit (despite of a high risk level on them).

So far as the expected norm of investment profit is set by the investor, this indicator forms also the sum of investment expenses of this or that instrument of financial investment which has to provide it the expected sum of profit. This settlement sum of investment expenses represents the real cost of a financial instrument of investment which develops in the conditions of the expected rate of return on it taking into account an appropriate level of risk.

If the actual sum of investment expenses on a financial instrument exceeds its real cost, efficiency of financial investment will decrease (i.e. the investor won't get the expected sum investment profit). To the contrary, if the actual sum of investment expenses will be below the real cost of a financial instrument, efficiency of financial investment will increase (i.e. the investor will get investment profit in the sum, bigger than expected).

Taking into account stated the assessment of efficiency of this or that financial instrument of investment is reduced to an assessment of its real cost providing expected norm of investment profit on it. The basic model of estimation of cost of a financial instrument of investment has the following appearance:

PV=?Размещено на http://www.allbest.ru/



WherePV -- the real cost of a financial instrument of investment;

CF -- an expected returnable cash flow during use of a financial instrument;

r -- the expected rate of return on the financial instrument, expressed in decimal fraction (formed by the investor independently taking into account a risk level);

n -- number of the periods of formation of returnable streams (in all their forms).

Features of formation of a returnable cash flow determine a variety of variations of used models of an assessment of their real cost by separate types of financial instruments.

We will consider the maintenance of these models in relation to debt and share financial instruments of investment on the example of bonds and actions.

Models of estimation of cost of bonds are constructed on the following initial indicators: a) bond face value: b) the sum of percent paid on the bonds; c) expected norm of gross investment profit (standard of profitability) on the bond: d) quantity of the periods to a bond maturity date.

The basic model of estimation of cost of the bond [Basis Bond Valuation Model] or the bond with periodic payment of percent has the following appearance:

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WhereCB -- the real cost of the bond with periodic payment of percent;

P0 -- the sum of percent paid in every period (representing work of its face value on the declared rate of percent);

Models of estimation of cost of actions are constructed on the following initial indicators: a) type of an action -- exclusive or simple; b) the sum of dividends assumed to receiving in the concrete period; c) expected course stock price at the end of the period of its realization (when using action during in advance defined period); d) expected norm of gross investment profit (standard of profitability) on actions; e) number of the periods of use of an action.

The model of estimation of cost of the preference share is based that these actions grant the right them to owners on receiving regular dividend payments in a fixed size. It has the following appearance:

PV = D/r

where CPS -- the real cost of the preference share;

D -- the sum of dividends provided to payment on the preference share in the forthcoming period;

r -- expected norm of gross investment profit (profitability) on the preference share, expressed in decimal fraction.

The economic maintenance of this model consists that the current real cost of the preference share represents private from division of the sum of the dividends provided on it into norm of gross investment profit expected by the investor.



2. Method of an assessment of profitability and risk of financial investments

2.1 Concept of profitability

As a rule, during implementation of investment activity the enterprise deals with several investment projects. Each project is characterized by the parameters. Therefore the enterprise should choose constantly optimum projects on the basis of in advance established criteria. The choice of selection criteria and justification of their values are based on investment strategy and policy of the enterprise. So, the aggressive investment policy assumes use as such criteria of higher values of risk and profit. The conservative investment policy allows application of criteria with low value of risk and profit. The moderate policy other things being equal results conditions in need of use of average values of the chosen indicators.

One of widespread selection criteria of investment projects - profitability.

Profitability - one of the main indicators of investments on which it is possible to estimate advantage of investments, their expediency and to compare them among themselves on this indicator. Often for an assessment of advantage of an investment of money use a sheaf risk profitability. The logic here is simple: in itself such indicators as profitability and risk are a little informative. What sense to invest money in tools with a high risk level and low potential profitability? If the risk of losses is great, and possible remuneration has to be at high level.

We will separate concepts of the income and profitability. The income is the absolute value expressed for example, in monetary units. While profitability - the relative size expressed as a percentage or annual interest rates.

Profitability shows, on how many percent the enclosed sum grew or the capital (and also how many percent of profit the asset made) increased. Profitability can be calculated both for all the time, and for a certain period (for example year).

Annual profitability - the important parameter in which investors can draw conclusions about appeal of this or that tool of investments. One of simple methods of an assessment of profitability and efficiency of the investment project is calculation of simple rate of return when the annual net profit shares on the total amount of investments. One of meanings of a similar assessment can call determination of terms of approximate payback of the investment project. It is also possible to mention such indicator as the period of payback of the project, pays off it by division of the sum of initial investments into a full revenue of the carried-out investments. This indicator is urged to show, how soon the money invested on the project to return and receipt of profit from already realized project will begin.

Typical zones "risk- profitability":

the least risky investments usually are the state bonds. Usually such investments are called "without risky", but nevertheless the system risk is inherent in them;

a little more risky are deposits, securities, etc. The probability of bankruptcy of the companies (including and banks) is much higher than probability of a default of the state;

and at last, the most risky are venture investments since mean investments in projects which with a high probability won't bring planned result. But in case of success, such projects pay off wholly.

In practice the economist in general and to the financier in particular very often should estimate overall performance of this or that system. Depending on features of this system the economic sense of efficiency can be invested with various formulas, but their sense always one is the relation of result to expenses. Thus the result is already received, and expenses are made.

Certainly, they are of a certain value for accounts department, characterize enterprise work for expired period, etc., but it is much more important for the manager in general and financial in particular to define overall performance of the enterprise in the future. And in this case the formula of efficiency needs to be corrected a little.

The matter is that we don't know 100% size of result received in the future, size of potential future expenses with reliability.

There is so-called "uncertainty" which we have to consider in our calculations, differently will simply receive the incorrect decision. As a rule, this problem arises in investment calculations at determination of efficiency of the investment project (IP) when the investor is compelled to define for himself to what risk he is ready to go to receive desirable result, thus the solution of this two-criteria task becomes complicated that tolerance of investors to risk is individual.

Therefore the criterion of adoption of investment decisions can be formulated as follows: The SP is considered effective if its profitability and risk are balanced in accepted for the participant of the project of a proportion, and formally to present in the form of expression (1):

Efficiency of SP = { Profitability; Risk } (1)

It is offered to understand the economic category characterizing a ratio of results and expenses of SP as "profitability". In a general view profitability of SP can be expressed a formula (2):

Profitability = { NPV; IRR; PI; MIRR } (2)

This definition doesn't conflict at all to term "efficiency" definition as definition of the concept "efficiency" is, as a rule, given for a case of full definiteness i.e. when the second coordinate of "vector" - risk, is equal to zero.

Efficiency = { Profitability; 0 } = Results / Expenses (3)

I.e. in this case:

Efficiency Profitability (4)

However in a situation it is impossible to tell "uncertainty" with confidence for 100% about the size of results and expenses as they aren't hit yet but only are expected in the future therefore there is a need to introduce amendments in this formula, namely:

Effectiveness =

Risk

Profitability

Figure 4

Note - Done by author based on [3]

where: and -possibility of receiving this result and expenses respectively.

Thus in this situation there is a new factor - risk factor which certainly needs to be considered in the analysis of efficiency of SP.

2.2 Classification of investment activities risks

In a general view classification of the risks most significant and specific to investment is presented in Figure 5.



Figure 5

Note - Done by author based on [3]

2.2 Definition of criteria and ways of risk analysis

The following block of process of regulation of risks is definition of criteria and ways of risk analysis. For this purpose in relation to each object of investment it is expedient to develop a complex of indicators under articles of the nomenclature of risks identified earlier and to determine critical and optimum values by separate indicators and their complex.

As the investment risk characterizes probability of short-reception of the expected income, its level is estimated as a rejection of the expected income on investments from average or settlement size. At calculation of probability of obtaining the expected income can be used both statistical data, and expert estimates. However at insufficiently representative statistics the best method processing by experts of statistical information and implementation on this basis of expert estimates is represented.

Traditionally statistical assessment of investment risks is carried out by two methods:

1) method of probabilistic distribution;

2) methodof an assessment on coefficient.

Measurement of investment risks on the basis of probabilistic distribution proceeds from consideration of the expected income on investment investments as casual variable and existence of probabilistic distribution of its possible values. According to it the risk level is estimated by the following sizes:

Mathematic expectations of profitability: M[E]=);

Profitability dispersions :=;

Mean square deviation of profitability:= ;

Coefficient of variation :=/M(E) ;

where-

p -probability ;

n-numberofobservations.

Thus the most probable value of profitability Aver is in the range

M(E)-<<M(E)+

In case of identical values of level of the expected income more reliable are investments which are characterized by smaller value of the mean square deviation showing a volatility of probability of receipt of the expected income (a profitability variation).

In case of distinction of values of the average levels of profitability on compared investment objects the choice of the direction of investments proceeding from values of a variation is impossible therefore in these cases the investment decision is made on the basis of the coefficient of a variation estimating the extent of risk at a size of profitability. The preference is given to those investment projects according to which value of coefficient of a variation is lower that testifies to the best ratio of the income and risk.

Evaluation method on coefficient it is used in case of risk identification of this investment object (generally share tools) in relation to level of systematic (market) risk. The coefficient is determined by a formula.

where Kr -- correlation between profitability of this share tool and the average level of profitability of share tools as a whole;

-- a mean square deviation of profitability on this share tool;

-- a mean square deviation of profitability on the security market as a whole.

In case of в = 1 this share tool is characterized by the average level of risk, in case of в>1 -- a high risk level and in case of в<1 -- a low risk level. Therefore, to increase в there is an increase of level of systematic risk of investment investments.

Use of statistical methods for a risks assessment of investing activities in the Russian economy has limited nature that is connected with absence or not representativeness of statistical data on many investment objects. With a certain degree of care statistical methods can be applied to risk analysis on a number of share tools, in particular on the most traded corporate securities. However the risks assessment of investment crediting and project financing on the basis of statistical methods, as a rule, isn't reliable.

In the absence of necessary information and statistical data for calculation of size of risks on the basis of statistical methods the risks assessment is carried out by an expert way. For this purpose in relation to each investment object it is reasonable to develop a complex of indicators under articles of the nomenclature of risks identified earlier and to determine limiting and optimum values by separate indicators and their complex.

After determination of simple risks the issue of a choice of a method of data of various indicators to a single integrated assessment is resolved. As such method it is possible to use one of traditional methods of receipt of rating indicators: index method, method of distances, the relative sizes, the weighed mark estimates.

For an assessment of a role of separate risks in general risk weighing is used; thus various approaches can be applied to each investment object in case of observance of such general requirements, as not negativity of weight coefficients and equating of their amount with unit.

The greatest attention is deserved by the approach assuming ranging of separate risks on degrees of priority and determination of weight coefficients of k according to the importance of these risks. So, the maximum value of weight coefficient k1prisvaivayetsya to the risks having in the circumstances paramount value, the minimum kn -- risks of the last rank; risks with the equal importance receive identical weight coefficients. Value of a ratio between weight coefficients of the first and last ranks (q = k1/kn) is determined also. As a method of weighing calculation of the average arithmetic or average geometrical is used. The distance between the next ranks can be estimated on a formula:

(q-1)/(n-1)

The weight coefficient of separate risk with a rank of m makes

=+(n-m)s

From here

(q-1)/(n-1) = [1+(n-m)(q-1)(n-1)]

If simple risks aren't ranged on priority degree, they, respectively, have equal weight coefficients (1/n).

For the purpose of control of reliability of results of a risks assessment when using weight coefficients according to degree of priority it is possible to estimate general risk of an investment object, applying the weight coefficients found by means of accidental distribution. As values of weight coefficients it is possible to use, in particular, average size (1/n) and the size of the mean square deviation calculated proceeding from possible value of coefficient of a variation (Var/ n).

2.3 Risk and profitability ratio

Profitability and risk, as we know, are the interconnected categories. Most the general regularities reflecting an interconnection between accepted risk and expected return of activities of the investor, the following is:

higher yield is, as a rule, inherent in more risk investments;

with a growth of the income the probability of its obtaining while certain minimum guaranteed income can be gained practically without risk decreases.

The optimality of a ratio of the income and risk means achievement of a maximum for a combination "profitability -- risk" or a minimum for a combination "risk -- profitability". Thus two conditions shall be satisfied at the same time:

1) any other ratio of profitability and risk can't provide bigger profitability in case of this or smaller risk level;

2) any other ratio of profitability and risk can't provide smaller risk in case of this or bigger level of profitability.

In fig. 11.1 it is shown that in case of an assumption of acceptance of one risk and one source of the income there is only one such combination -- a point E.

However as in practice the investing activities are connected with multiple risks and use of various resource sources, the quantity of optimum ratios increases. With respect thereto for achievement of balance between risk and the income it is necessary to use a step-by-step method of the decision by consecutive approximations. Implementation of investing activities assumes not only acceptance of known risk, but also providing a certain income. If to assume that to minimum risk there corresponds the minimum necessary income, it is possible to allocate some sectors which are characterized by a certain combination of the income and risk: And, In, Page.

Sector And, investments in which don't provide the minimum necessary income, can be considered as area of insufficient profitability. Functioning in sector With is connected with the high risks reducing possibility of receipt of the expected high income therefore the sector With can be determined as area of the increased risk. Implementation of investments in sector In provides to the investor achievement of the income in case of admissible risk, therefore, the sector In is area of optimum values of a ratio of profitability and risk.

The investing activities are connected with different types of risks.



3. Analysis of Program on attraction of investments, development of special economic zones and export promotion in the Republic of Kazakhstan for 2010 - 2014 years.

3.1 Passport of the program

Table 1

Name	Program on attraction of investments, development of special economic zones and export promotion in the Republic of Kazakhstan for 2010 - 2014 years
The basis for development	Strategic development plan of the Republic of Kazakhstan till 2020 approved by the Decree of the President of the Republic of Kazakhstan of February 1, 2010 No. 922; The state program on the development of the Republic of Kazakhstan forced industrial innovatively for 2010 - 2014 approved by the Decree of the President of the Republic of Kazakhstan of March 19, 2010 No. 958 (further - GPFIIR)
Developer	Ministry of the industry and new technologies of the Republic of Kazakhstan
The purpose	Attractive Conditions for Direct Investments program in non-oil export-oriented and hi-tech productions and integration into world trade system through advance of export of the processed goods
Tasks	Improvement of Conditions of Attraction of Investments program. Advance of positive investment image of Kazakhstan. Creation of new SEZ and industrial zones (further - FROM). Improvement of standard and legal base on regulation of activity of SEZ. Assistance to development and advance to export of the Kazakhstan production by ensuring service support to exporters. Rendering financial support to exporters..
Realization term	2010-2014 years
Target indicators	By the end of 2014 it is planned: 1. Involvement of 18 target investors from the list of the companies included in Global-2000. 2. Domestic and foreign investments into non-oil sectors of economy (manufacturing industry, processing of agricultural production, service) will increase not less than by 15%. 3. The volume of the direct foreign investments (DFI) to GDP will increase by five percentage points. 4. Sources of investments are diversified (7 main countries of investors from shares of each country of 5% and more). 5. Conclusion of agreements with the foreign states about encouragement and mutual protection of investments. 6. Achievement of an indicator of the Global index of competitiveness of the World economic forum: "Influence of the rules regulating direct foreign investments on business" - the 102nd place; (in 2009 - 107 place); "Direct foreign investments and technologies" - the 108th place (in 2009 - 113 place). 7. Improvement of positions of Kazakhstan in a rating of "DoingBusiness" on the Protection of Investors indicator. 8. Creation until the end of 2011 of 2 SEZ: in the city of Karaganda on the basis of Industrial park (for development of metallurgy and metal working) and SEZ "The border trade and economic zone "Horgos -- East Gate", as main part of a logistic framework Western Europe - the Western China (for development of different types of the processing productions and transport and logistic services). 9. Creation of SEZ on the NazarbayevUniversiteta base. 10. Creation until the end of 2014 5 FROM in the cities of Almaty, Pavlodar, Aktobe, UstKamenogorsk, Families and Uralsk with various branch orientation. 11. Increase in number of participants at SEZ with 39 in 2009 to 159 by 2015 and on FROM to 42 by 2015. 12. Increase in investments into non-oil export-oriented and hi-tech production in territories of SEZ to - 1588 billion tenges by 2015 and in territories FROM to - 151 billion tenges. 13. Increase in production of goods and services (works) in territories of SEZ from 21,9 billion tenges in 2009 to - 718 billion tenges by 2015, FROM to - 719 billion tenges by 2015, including export of production not less than 50% of output. 14. The share of non-oil export in the total amount of export will make not less than 40% by 2015.
Volumesand sources financings	The total volume of financing of all actions at the expense of means of the republican budget will make 19 559 962 thousand tenges, including on: actions for attraction of direct foreign investments - 1 382 596 thousand tenges; actions for development and creation of SEZ and IZ - 13 506 395 thousand tenges; actions for export stimulation - 4 670 971 thousand tenges.

3.2 Swot analyses

SWOT analysis of attraction of investments into Kazakhstan

Table 2

Strengths	Weaknesses
1. The favorable business climate of the country supported by economic and political stability. 2. High investment appeal of the country, owing to existence of rich natural and mineral resources. 3. An advantageous geographical position of Kazakhstan to the large consumer markets of the Central and Forward Asia, Russia, India and China. 4. Awareness of priority of the state investment policy. 5. Formation of the specialized institutes and their resource base directed on assistance to inflow of investments.	1. Lack of system city in carrying out the state investment policy. 2. Instability of the legislation of the country and lack of the mechanisms providing observance of laws and the contractual relations. 3. Low competitiveness conditions on attraction of investments (customs and currency regulations). 4. Backwardness of the infrastructure providing attraction of investments (special zones, financial, bank, information and analytical, consulting, transport and so forth). 5. Instability of the system of public administration connected with attraction of investments. 6. Visaregime
Opportunities	Threats
1. Exit to a position of the regional leader in volumes of attraction of investments. 2. Creation of positive investment image of the country in the world markets of the capital. 3. Creation of a system and consistent state policy on attraction of investments. 4. Formation of effective state and private infrastructure on attraction of investments. 5. Ensuring steady and balanced economic growth of the country due to redistribution of investments from extracting into the overworking economy sector. 6. Resources of National agency on export and investments of "Kaznex Invest"	1. Loss of investment appeal of the country as a result of exhaustion of a source of raw materials. ...

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