Questions On Securities Market And Traded On Secondary...

Q. 2. Explain how securities are issued in the primary market and traded on secondary markets. â€Å"There are two different types of securities markets: the primary securities and the secondary securities market† (Kelly Williams, 2016, pg. 165). So, what does the term primary securities mean, it’s a market that describes a portion of the capital market where new securities are issued by companies, government entities; or public institutions. In this market, there is more than one way to issue securities, the first is what is known as the public offering; it’s where anyone that is trying to raise their financial capitals within that market can investing by purchase these financial securities from that of the public. Therefore, these public†¦show more content†¦Though, these investment banks are well compensated for every sell the make on the actual sell of these securities, so they will make every effort to approach the situation any way possible; just to land extra security for themselves. In addition, the bank or financial institution will pledge to buy whatever shares do not sell through these investment banks, and replace them with new ones at an adequate price; that all are on agreement too in order to gain a profit of some sort. Unfortunately, in order for the firm to go out on the limb publicly, it must first file what is called a registration statement through that of the (SEC); containing the necessary requirements the name of the corporation manager, what assets they own, their competitors’ names; and what these funds are intended to be use towards before even being considered any form of offering. Therefore, no sale can move forward, until the (SEC) gives the firm the red light to proceed with the offering of these securities; or confirms the statement to be that of a functional fact. On the other hand, there is yet another method to which one can apply to that of securities, and that is what is called private placement; securities that are sold to one or more investor, individual, or that of an institution; through that of bargaining among the two main investors (the issuing firm and the private investors). However, while knowing the difference between the two methods of issuing isShow MoreRelatedEssay on Financial Management Integrated Case 2 Answers1381 Words   |  6 Pages | |Financial Management Section C | |Homework 2: Integrated Case Questions | Chapter 2 Integrated Case 2-11 A) In a well-functioning economy, capital flows efficiently from those with surplus capital to thoseRead MoreBank Processes1139 Words   |  5 PagesCapital Markets and Investment Banking Process Paper FIN 402 May 6, 2012 Alger Marable Capital Markets and Investment Banking Process Paper Investment banking is a crucial part of our global business environment. Investments, banking, and other capital markets now have a valuable role in business and everyone’s daily lives. There are several strategies and methods that can be identified for effective and productive investment bankingRead MoreAnalyzing Stock Exchange Market On Wall Street Work1534 Words   |  7 Pages However, not a lot of people know what stocks are exactly, and what it is that they do. Many movies, such as Wolf of Wall Street, and Big Short, have been made to illustrate stock exchange market and give us a better picture on how that crazy lifestyle on Wall Street work. There are still many questions circling around that focus on how stocks are governed, and how they are regulated. To get a full understanding on just how stock exchange works, we will take it back to its origins, and slowlyRead MoreQuestions And Complete The Following Problems935 Words   |  4 Pagesfollowing questions and complete the following problems, as applicable. 1. Classify the following transactions as taking place in the primary or secondary markets: †¢ IBM issues $200 million of new common stock. Primary Market †¢ The New Company issues $50 million of common stock in an IPO. Primary Market †¢ IBM sells $5 million of GM preferred stock from its marketable securities portfolio. Secondary market †¢ The Magellan Fund buys $100 million of previously issued IBM bonds. Secondary Market †¢ PrudentialRead MoreMultiple Choice2644 Words   |  11 PagesChapter 2 Overview of the Financial System 2.1 Multiple Choice Questions 1) Every financial market has the following characteristic: A) It determines the level of interest rates. B) It allows common stock to be traded. C) It allows loans to be made. D) It channels funds from lenders-savers to borrowers-spenders. Answer: D 2) Financial markets have the basic function of A) bringing together people with funds to lend and people who want to borrow funds. B) assuring that the swings in the businessRead MoreEbay Case Analysis Essay1261 Words   |  6 Pages2002= .0117 o 2001= .053885 o Market Value o Price earnings ratio= price per share/ earnings per share o Du Pont Ratio o ROE= (Net Profit/ Sales) X (Sales/ Assets) X (Assets/ Equity) o 2002 ROE= (48,294/1213000) X (1,213,000/ 4,124,444) X (4,124,444/ 3,556,473) .03918 X .2941 X 1.160 o ROE= .013 Step 3: External Environment • Opportunities 1. The changing lifestyles of people can help eBay penetrate the market even further and broaden theirRead MoreIndia, Appellee V. Raj Rajaratnam1240 Words   |  5 Pagesjudgement was affirmed, on June 24, 2013 by Judge-Josà © A. Cabranes. (United States v. Raj Rajaratnam, 2013) Background: Raj Rajaratnam is a founder of Galleon Group a hedge fund based in New York that managed billions of dollars in various capital market strategies for clients and its business partners. It was indicated that Raj Rajaratnam was explicitly trading on material nonpublic information since 2003 until 2009. He was alleged to receive material nonpublic information unlawfully about privateRead MoreAn Analytical Study of the Impact of Dollar-Rupee Movement on Indian Equity Market.1104 Words   |  5 PagesSYNOPSIS 1. TITLE OF THE STUDY: An analytical study of the impact of Dollar-Rupee movement on Indian equity market. 2. INTRODUCTION TO THE STUDY: The study is about how the Rupee appreciation or Rupee depreciation against Dollar impacts the investors in Indian equity market. The study details about the concepts of Currency fluctuations, Rupee appreciation and Rupee Depreciation. * Currency fluctuation There are mainly two ways by which currency rates are managed. Firstly, countriesRead MoreMarket Structure And Functions Of The World Economy1832 Words   |  8 PagesAssignment Student name : - Md Mokshed Hasan Student id : - 614181 Part one: - Market structure and functions Q1,a) Financial markets:- It’s a marketplace where buyers and sellers participate in the trade of assets like equities, binds, currencies and derivatives. Financial markets are well-defined by having transparent pricing, rudimentary regulation on trading, cost and fees and market forces determining the pieces of stocks trade. Its participants need to fulfil some of certainRead MoreThe Capital Market : An Overview1150 Words   |  5 PagesThe capital market is considered as the interface through which entities engage in buying and selling debt and equity instruments. Debt instruments like bonds, loans etc pay interest to holders, whilst equity instruments like common stock or preferred stock pay dividends. The capital market directs the flow of savings and investment between providers of capital such as retail and institutional investors, and those who need this capital like corporate entities, governments and individuals. These