Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Leveraged buyout wikipedia , lookup
Commodity market wikipedia , lookup
Trading room wikipedia , lookup
Environmental, social and corporate governance wikipedia , lookup
Short (finance) wikipedia , lookup
Algorithmic trading wikipedia , lookup
Mark-to-market accounting wikipedia , lookup
Systemic risk wikipedia , lookup
Market (economics) wikipedia , lookup
Financial crisis wikipedia , lookup
Systemically important financial institution wikipedia , lookup
Indian Financial System: An Overview www.moneycontrol.com & google Contents • Financial Markets • Stock Exchange www.moneycontrol.com & google Financial Markets • A Market is a place where buyers and sellers come together to exchange financial instruments • Is a network of financial institutions, market regulations where financial transactions are done • A Financial Market is known by type of product traded in it Flow of funds (savings) Seekers of funds (Mainly business firms Flow of financial services and government) Incomes , and financial claims www.moneycontrol.com & google Suppliers of funds (Mainly households) Financial Markets • Primary Market • Instruments issued for first time • Used by • Government/Corporate/PSU’s • IPO • Initial Public Offering • Secondary Market • Trading of already issued • Stocks • Bonds • Stock Exchange www.moneycontrol.com & google Different Financial Markets FINANCIAL MARKET Money Market Debt Market Hybrid Market www.moneycontrol.com & google Capital Market Money Market • Markets for short term • Borrowing • Lending • Primarily used by Banks • Typical Financial Instruments • Commercial paper • Certificate of Deposit (CD) • Treasury Bills www.moneycontrol.com & google Debt Market • Debt • Contract • One Party lends to another Party • Predetermined • Interest Rates and Term • Participants • Banks • Financial Institutions • Mutual Funds • Insurance Companies etc. • Instruments • Government Securities (G-Secs) • Public Sector Units Bonds • Corporate Securities www.moneycontrol.com & google Capital Market • Long Term Funds • Raised by • Government • Corporates • Trading Instruments used • Shares • Derivatives • Units of Mutual Funds www.moneycontrol.com & google Risk-Return Trade Off • Liquidity risk- Ability to pay short term obligation. If ability < desire, there exists liquidity risk. • Credit risk-Risk of default of borrowers of loan. Lower the solvency of organization, higher is the credit risk. • Inflation Risk- It is the risk of fall in purchasing power due to increase in price. • Interest Rate Risk- is the risk of loss in bond value due to change in interest rate Class Notes Stock Exchange • Place where the shares are traded • BSE • NSE • BSE – Bombay Stock Exchange • Oldest Stock Exchange in Asia • Sensex – Sensitive Index • Index of 30 Actively traded Companies • NSE – National Stock Exchange • Incorporated in 1992 • Nifty • Index of 50 Actively traded Companies www.nseindia.com & www.bseindia.com Financial intermediaries • Lower transaction cost • Risk management • Asymmetric information www.nseindia.com & www.bseindia.com Benefits of listing • Visibility • Market Support • Investor confidence • Increase in demand of goods and services • Increase in profitability www.moneycontrol.com & google Reflexes from the class Investment decisions are to be implemented in the financial markets which are a part of the financial system. All activities of sale and purchase of investments take place in financial markets All investors have to regularly interact with these markets.They must understand the structure of the financial market - What these market are? - What are their features and characteristics? - What are market participants? - What type of instruments are available? etc…… Sources • www.nseindia.com • www.bseindia.com • www.moneycontrol.com • Class Notes • And, !!! www.moneycontrol.com & google Thank You… Shikha Nagar Ravneet Kaur Raman Khattar Prabhjot Singh Pallavi Goel Manav Mahajana Chirag Pankaj Karan Kapoor www.moneycontrol.com & google