Welcome to Scribd. Sign in or start your free trial to enjoy unlimited e-books, audiobooks & documents.Find out more
Download
Standard view
Full view
of .
Look up keyword
Like this
8Activity
0 of .
Results for:
No results containing your search query
P. 1
Guide to Financial Industry

Guide to Financial Industry

Ratings:

4.33

(1)
|Views: 228|Likes:
Published by api-3837252

More info:

Published by: api-3837252 on Oct 18, 2008
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

03/18/2014

pdf

text

original

The Guide to Financial Industry
Prepared by Frederic Goblet 01/13/98
page1
The Guide to Financial Industry
The Guide to Financial Industry
Prepared by Frederic Goblet 01/13/98
page2
The Guide to Financial Industry
Table of Content

THE GUIDE TO FINANCIAL INDUSTRY....................................................................................2 INTRODUCTION.........................................................................................................................6 WHAT IS AN INVESTMENT ?....................................................................................................7

The Investment Process......................................................................................................7
THE MARKET AND THE INSTITUTIONS..................................................................................9
THE INVESTMENT BANKS............................................................................................................9
The Investment Bank..........................................................................................................9
THE INSTITUTIONAL INVESTORS.................................................................................................10
THE CUSTODIAN......................................................................................................................10
What is Custody ?.............................................................................................................10
The Custodian...................................................................................................................10
THE SUBCUSTODIAN................................................................................................................12
Role of the Subcustodian..................................................................................................12

TRUSTEE................................................................................................................................13 THE BROKER..........................................................................................................................14 THE SECURITY EXCHANGES......................................................................................................14

The New York Stock Exchange.........................................................................................15 The American Stock Exchange.........................................................................................16 Regional Stock Exchanges................................................................................................16 NASDAQ..........................................................................................................................16 The Chicago Board Options Exchange..............................................................................17 Country Specific Exchanges (National Exchanges)............................................................17

THE MARKET INDEXES.............................................................................................................18
WHAT IS A TRADE, HOW DOES IT WORK ?...................................................................................19

Securities Settlement........................................................................................................22 Delivery vs. Payment........................................................................................................23 Clearing House Funds vs. Same Day Funds.....................................................................23 Free Delivery.....................................................................................................................23 Book Entry vs. Physical.....................................................................................................23 Trade Date........................................................................................................................24 Contractual Settlement Date.............................................................................................24 Actual Settlement Date......................................................................................................24 Failed Trades....................................................................................................................24 DK (Don't Know)...............................................................................................................25 Market Conventions..........................................................................................................25

THE INVESTMENT MANAGERS...................................................................................................27
THE DEPOSITORIES AND CLEARANCE SYSTEMS..........................................................................28
Book Entry........................................................................................................................28
Immobilization...................................................................................................................29
The Guide to Financial Industry
Prepared by Frederic Goblet 01/13/98
page3

Dematerialization...............................................................................................................29 Depository Trust Company (DTC).....................................................................................29 Participant Trust Company (PTC)......................................................................................30 Federal Reserve Bank (+ see Regulators).........................................................................30 EUROCLEAR....................................................................................................................30 Cedel................................................................................................................................31

PRIMARY MARKET....................................................................................................................31 SECONDARY MARKET...............................................................................................................31 THE OVER-THE- COUNTER MARKET..........................................................................................31 THE REGULATORS...................................................................................................................32 THE CENTRAL BANK OF THE U.S.A. : THE FEDERAL RESERVE SYSTEM.........................................32

How the Fed works...........................................................................................................33 Member Banks..................................................................................................................33 The Federal Reserve\u2019s many Roles...................................................................................33

THE G30 , THE GROUP OF THIRTY............................................................................................34
S.W.I.F.T. SOCIETY FOR WORLDWIDE INTERBANK FINANCIAL TELECOMMUNICATIONS...................35
TYPES OF INVESTMENT........................................................................................................37
INVESTMENT STRATEGIES...................................................................................................38

RISK-RETURN TRADE-OFF............................................................................................38 DIVERSIFICATION...........................................................................................................38 ASSET ALLOCATION.......................................................................................................39

THE CONCEPT OF RISK (\u03b2
\u03b2,\u2026) AND RETURN.......................................................................42

What is Risk ?...................................................................................................................42 The Types of Risk.............................................................................................................42 How to measure risk ?......................................................................................................43 Measuring Systematic Risk...............................................................................................44 The Required Rate of Return.............................................................................................45

THE BALANCE SHEET AND THE INCOME STATEMENT......................................................46
THE BALANCE SHEET................................................................................................................46

Assets...............................................................................................................................46 Liabilities...........................................................................................................................46 Owner's equity..................................................................................................................47

THE INCOME STATEMENT..........................................................................................................47
THE TIME VALUE OF MONEY................................................................................................49

THE NET PRESENT VALUE........................................................................................................49 REQUIRED RATE OF RETURN....................................................................................................49 EXPECTED RATE OF RETURN....................................................................................................49 PRESENT VALUE FORMULA.......................................................................................................50 FUTURE VALUE FORMULA.........................................................................................................50

THE STOCK MARKET.............................................................................................................51
GOING PUBLIC........................................................................................................................51
THE PRICE..............................................................................................................................52

The Price..........................................................................................................................52 The Spread.......................................................................................................................52 The Ticker.........................................................................................................................53 Reading the Newspaper....................................................................................................53

THE SUPPLY AND DEMAND........................................................................................................54 HOW TO VALUE A STOCK ?........................................................................................................58 EARNINGS PER SHARES (EPS).................................................................................................58

Activity (8)

You've already reviewed this. Edit your review.
1 thousand reads
1 hundred reads
dannung liked this
Martin Harding liked this
mechrav liked this
tejapriyanka liked this
bibekananda100 liked this

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->