Introduction to Financial Markets - Essay Example

Only on StudentShare

Extract of sample
Introduction to Financial Markets

From this discussion it is clear that by differentiating the functions of the financial markets, it is important to mention both, diverse financial institutions that operate in such markets as well as the diverse ways in which these souks are structured. This is referring to the financial institutions otherwise referred to as the major players in the financial markets. This paper highlights that brokers are often considered as commissioned mediators of a buyer or seller who aids transaction by identifying a seller or buyer to achieve the desired transaction. A broker does not have a say in the assets she or he just trades. In other words, the broker does not reserve records in these assets. The benefits or wages of brokers are established by the commissions that they charge to consumers of their services such as the sellers, the buyers, or sometimes both. For instance, brokers include stockbrokers and real estate brokers. The next institution is the dealers. Like brokers, they facilitate business by matching purchasers with assets from sellers; they do not connect in asset conversion. Unlike brokers, however, dealers can maintain records of the assets that they have traded such bought or sold. Such activities often allow them to, the dealer to vend out of the catalogue rather than constantly having to identify sellers to match each tender to purchase. The difference between the price a dealer provides to sell and the price at which he offers to purchase a product is referred to as bid price. ...
Download paper

Summary

The essay is developed from the Financial Markets Theory that avails classical asset pricing hypothesis, a hypothesis composed of objectives such as portfolio choices, basic asset pricing theorem, risk management, portfolio limit, information in financial markets and no risk neutral assessment…
Author : eboyle

Related Essays

Financial Markets and Risks
4 pages (1004 words) Essay
Financial Institutions & Markets - Financial Innovation
6 pages (1506 words) Essay
Financial Markets and Institutions
5 pages (1255 words) Essay
Introduction to Financial Markets - Forecasting interest rates
6 pages (1506 words) Essay
financial markets subject
12 pages (3012 words) Research Paper
International Financial Markets
10 pages (2510 words) Essay
Financial Markets
4 pages (1004 words) Assignment
Got a tricky question? Receive an answer from students like you! Try us!