StudentShare solutions
Triangle menu

Financial Markets and Institutions, Part 2 - Essay Example

Not dowloaded yet

Extract of sample
Financial Markets and Institutions, Part 2

Financial institutions on the other hand makes the trade to run smoothly through rendering of loans, grants and other financial aids to firm and individual. Additionally, financial bodies accept the deficit units therefor enabling investors to access capital to establish companies and industries. Question 1. Analyze the role financial market playing creating economic wealth in the U.S. In the economy of United States of America financial markets plays several roles. This markets are usually seem to the backbone to American economy this is because many people in this country are wealth merchants who spend most of their time in business activities. With respect to their economy, trader maximizes the financial markets opportunity wisely in order to stabilize the economy of this country. The financial markets controls and transfers money from the persons with excess money with the needy ones. They help the students from difference institution to get loan, which they use to pay their school fees, it also helps the government to get capital for its expenditure, business people are able to get funds and expand their operations. In order financial market to have funds to rent to the needy persons, business and households should be willingly to supply the excess funds to the financial market. ...
Financial market gives them money in order they can use. For instance, student who are deficit units often borrows money from the financial markets to support themselves through their academic period, therefore in return after they get employed the excess/surplus tend to become surplus units through investment. But, after some years they may become deficit units by purchasing valuables such as homes. This is because at this duration they may be able to access good amount of money from financial institution (Madura, 2012). Investors access money from financial market through dispensing of securities which act as claim on the issuer. Borrowed funds are represented as debt thus they are known as debt securities. The excess unit that are bought as debt securities are called creditors because they get interest according to the basic duration. All debt securities have the maturity date, the time in which surplus units can be accessed or redeemed in order to earn the principal value from the deficit units. Another, type of security is an equity security also known as stock. Stock represents the owner of a business. Most of the business prefer to give stock more than debit security if they require money, nevertheless the required fund sometimes might not be financially able to make a periodic payments on interest for the debt securities (Madura, 2012). Financial markets are classified according to the amount of fund they give inform of loans and grants. These classifications involves, primary versus secondary markets, accommodating corporate finance need and finally accommodating investment needs. Primary verses secondary market supports an issuance of current securities where else secondary markets enable the existing businesses to grow that results to smooth ...Show more

Summary

Financial Markets and Institution, Part 2 Name Institution 1st December, 2013 Introduction Financial market can be defined as commercial place where financial assets are such as bonds and stock are sold or purchased. A financial market plays a big role in transfer of funds/capital that enables government, companies and consumers to have what is known as cash flow…
Author : brantjohns
Financial Markets and Institutions, Part 2 essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Financial Markets and Institutions, Part 2"
with a personal 20% discount.
Grab the best paper

Related Essays

International Financial Markets and Institutions 2
Answer: A put option and a call option are the two different options on a future or forward contract. An option is basically a financial derivative contract that provides a party the right to buy or sell an underlying asset at a price defined in the contract.
4 pages (1000 words) Essay
Financial Markets and Institutions
According to Allen and Gale (2000, chap 1), Financial intermediaries can be broadly classified into: deposit taking institutions such as banks, credit unions, savings and savings societies; Insurance schemes such as life insurance policies; investment ventures such as retirement benefits schemes and mutual funds.
6 pages (1500 words) Essay
Financial Institutions & Markets - Financial Innovation
can be supposed to be the attributing factors towards the development of financial innovation. Innovations are mainly done to achieve the basic objectives of financial systems like facilitating the required payment instruments, increased savings, reduction in costs, etc.
6 pages (1500 words) Essay
Financial Markets and Institutions
Both developed and developing countries have faced the severity of the consequences of this crisis. While the crisis had taken shape, economists, politicians and researchers were concerned about the causes that triggered a crisis of such a dimension. Although it was quite late and the crisis was already in full swing, researchers claim that prior signs were visible about the occurrence of the crisis.
8 pages (2000 words) Essay
Financial Markets and Institutions
Now, the question is how an individual invest. He/she may begin to build up his financial assets in order to pay for long term financial goals. He/she may want assets accessible to make down payments on housing and may also want to guarantee that human capital is low risk by buying disability insurance and term insurance (Schewart, 1999, pp.1-2).
5 pages (1250 words) Essay
Australian Financial Institutions and Markets
The financial industry as a whole is massive, according to Axiss (2005,5), "It is a major driver of Australia's economic growth, considerably outweighing agriculture and mining combined, the two Industries traditionally associated with Australia's economic wellbeing." The success of banks has benefited the economy as a whole but has also affected various financial institutions, instruments and markets in Australia.
8 pages (2000 words) Essay
Financial Markets and Institutions
This paper will define what financial markets and institutions are and their implication in an economy particularly in a largely consolidating world market. Financial markets "consist of agents, brokers, institutions, and intermediaries transacting purchases and sales of securities." The individuals and institutions operating in the financial markets are linked by contracts and communications networks that form an externally visible financial structure, laws, and friendships.
10 pages (2500 words) Essay
Financial Institutions & Markets
US economy, forced banks to incur billions in losses, and latter spread to the UK causing near bankruptcy of Northern Rock in Newcastle that was finally nationalised in February 2008. In this paper, the effect on sub prime loans will be discussed and a closer look on its effects
8 pages (2000 words) Essay
Financial Institutions
In this paper, I will try to explore the different roles of financial institutions to individuals and businesses. After which, I shall highlight the importance of financial tools and methods such as forecasting by taking the hypothetical role of manager of the high school division of Abel Athletics.
4 pages (1000 words) Essay
Financial Markets and Institutions,
127). The New York Stock Exchange (NYSE) is an example of a financial market where financial assets are being traded. Transactions in the NYSE include the buying and
5 pages (1250 words) Essay
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation