Scribd Logo
Upload

Welcome to Scribd!

  • 15 views

    Treasury Notes and Bonds

    Uploaded by

    Hayjack
    The document discusses various types of financial instruments. It describes money market instruments like treasury bills, central government deposits, repurchase agreements (repos), commercial paper, negotiable certificates of deposit, and bankers' acceptances. It also discusses debt market instruments like treasury notes and bonds, mortgages, municipal bonds, and corporate bonds. The equity market and hybrid instruments like convertible bonds are also mentioned. Finally, it lists 10 trends in financial markets like technology, globalization, deregulation, competition, complexity, innovation, speed, conglomerates, derivatives, and speculation.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Treasury Notes and Bonds

    Uploaded by

    Hayjack
    15 views2 pages
    The document discusses various types of financial instruments. It describes money market instruments like treasury bills, central government deposits, repurchase agreements (repos), commercial paper, negotiable certificates of deposit, and bankers' acceptances. It also discusses debt market instruments like treasury notes and bonds, mortgages, municipal bonds, and corporate bonds. The equity market and hybrid instruments like convertible bonds are also mentioned. Finally, it lists 10 trends in financial markets like technology, globalization, deregulation, competition, complexity, innovation, speed, conglomerates, derivatives, and speculation.

    Original Title

    Financial_Management_5

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document discusses various types of financial instruments. It describes money market instruments like treasury bills, central government deposits, repurchase agreements (repos), commercial paper, negotiable certificates of deposit, and bankers' acceptances. It also discusses debt market instruments like treasury notes and bonds, mortgages, municipal bonds, and corporate bonds. The equity market and hybrid instruments like convertible bonds are also mentioned. Finally, it lists 10 trends in financial markets like technology, globalization, deregulation, competition, complexity, innovation, speed, conglomerates, derivatives, and speculation.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    15 views2 pages

    Treasury Notes and Bonds

    Uploaded by

    Hayjack
    The document discusses various types of financial instruments. It describes money market instruments like treasury bills, central government deposits, repurchase agreements (repos), commercial paper, negotiable certificates of deposit, and bankers' acceptances. It also discusses debt market instruments like treasury notes and bonds, mortgages, municipal bonds, and corporate bonds. The equity market and hybrid instruments like convertible bonds are also mentioned. Finally, it lists 10 trends in financial markets like technology, globalization, deregulation, competition, complexity, innovation, speed, conglomerates, derivatives, and speculation.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    You are on page 1of 2

    Financial Instruments

    MONEY MARKET INSTRUMENTS


    1. Treasury Bills – issued by the Bureau of Treasury to raise funds and sold at a discount. Risk
    Free.
    - The market for treasury bill is deep = liquid.
    - Buyer – Competitive Bidders
    - Non-Competitive Bidders
    - Book Entry Securities – Securities that does not have physical document.
    2. Central Government Deposits – A deposit at the Central Bank.
    - Risk Free.
    - A deposit of a commercial bank at BSP for the purpose of satisfying
    minimum reserved requirements.
    - Total Reserves – Minimum Reserves = Excess Reserves
    3. REPO – Repurchase Agreement – sale of securities with an immediate agreement to buy them
    back on a specific future date at a slightly higher price.
    - Overnight Loan
    - Secured Loan
    - Low Risk
    - Collateralized Loan
    4. Commercial Paper – A security that is issued by corporations or financial institutions
    - Short Term and sold at a discount
    - Direct Placement – it is the sale of securities without the help financial
    intermediaries.
    - Back up line of credit
    5. Negotiable Certificate of Deposit – a deposit at a depository institution usually a commercial
    bank and can be bought and sold.
    - Large in Denomination – size of the face value
    - Typical buyer is institutional investor
    - Typical seller is commercial bank
    - Term Security – a security that matures a particular term.
    - Bearer Instrument

    6. Bankers’ Acceptance – the acceptance of responsibility to pay in case of default


    - Very low risk.
    - Guaranteed by the bank.

    CAPITAL MARKET
    - A market where long-term securities are traded.
    DEBT MARKET
    - A market where debt instruments/securities are traded.
    - Where fixed-income instruments are traded.
    - Bond Market
    1. Treasury Notes and Bonds
    - Long-term instrument
    - Issued by the Government, particularly Bureau of Treasury.
    - Coupon
    - Tenor – time to mature of a financial instrument – 2 – 10 years
    - High interest rate risk
    2. Mortgages
    - A loan secured by a real estate property.
    3. Municipal bonds
    - A bond issued by a local government.
    4. Corporate Bonds
    - Bonds issued by a corporation.
    5. Finance Lease
    - A loan for the purchase of an equipment.
    - The lender is the owner of the purchased equipment.

    EQUITY MARKET
    - A market where equity instruments are traded
    - Instruments of ownership
    - Stock Market
    6. Preferred Stocks/Preference shares
    - The corporation guarantees a particular dividend payment.
    - A class of ownership that has a higher claim on assets and earnings.
    7. Common Stocks/Ordinary Shares
    - As security that represents ownership in a corporation.
    - Receives whatever assets remain after creditors, bondholders and preferred stockholders are
    paid.

    HYBRID MARKET
    - Financial Institution that has the characteristics of a debt and equity at the same time.
    8. Convertible Bonds
    - Bonds with a characteristic that can be converted into a predetermined number of ordinary
    shares

    FINANCIAL TRENDS
    1. Technology
    - Webification – everything happens on the internet
    2. Globalization
    - Competition is global.
    - More international transaction
    - Interconnectedness
    - Interdependence
    3. Deregulation - Reregulation
    - Lowering of regulations for the financial market
    4. Competition
    - Is a result of 3 things 1. Deregulation 2. Globalization 3. Technology
    5. Complexity
    - Since there is a competition in the market, adding more features to the instrument makes it
    more complex.
    6. Innovation
    - Introducing a new product that meets the demand of the market.
    7. Speed
    - Fast moving market
    8. Conglomerate
    - Financial institution that offers a large number of services of different financial services
    9. Derivatives
    - Contract between two or more parties whose value is based on an agreed-upon underlying
    financial asset or security or set of asset or index.
    10. Speculation
    - It is the purchase of a security with the hope that it will become more valuable in the near
    future.

    You might also like