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    AE 322 Financial Markets: Mrs. Carazelli A. Furigay, Mba

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    DJUNAH MAE ARELLANO
    Financial markets are physical or electronic forums that facilitate the flow of funds among investors, businesses, and governments. They provide a mechanism for allocating financial resources from savers to those demanding funds. Major financial markets include securities markets for trading debt and equity, derivatives markets, mortgage markets, and currency exchange markets. Within securities markets, there are money markets for short-term securities and capital markets for long-term securities over one year. Primary markets involve new issuances while secondary markets facilitate trading of existing securities through organized exchanges or over-the-counter networks. Common money market instruments are commercial papers, treasury bills, repurchase agreements, and interbank loans.

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    AE 322 Financial Markets: Mrs. Carazelli A. Furigay, Mba

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    DJUNAH MAE ARELLANO
    66 views11 pages
    Financial markets are physical or electronic forums that facilitate the flow of funds among investors, businesses, and governments. They provide a mechanism for allocating financial resources from savers to those demanding funds. Major financial markets include securities markets for trading debt and equity, derivatives markets, mortgage markets, and currency exchange markets. Within securities markets, there are money markets for short-term securities and capital markets for long-term securities over one year. Primary markets involve new issuances while secondary markets facilitate trading of existing securities through organized exchanges or over-the-counter networks. Common money market instruments are commercial papers, treasury bills, repurchase agreements, and interbank loans.

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    Financial markets are physical or electronic forums that facilitate the flow of funds among investors, businesses, and governments. They provide a mechanism for allocating financial resources from savers to those demanding funds. Major financial markets include securities markets for trading debt and equity, derivatives markets, mortgage markets, and currency exchange markets. Within securities markets, there are money markets for short-term securities and capital markets for long-term securities over one year. Primary markets involve new issuances while secondary markets facilitate trading of existing securities through organized exchanges or over-the-counter networks. Common money market instruments are commercial papers, treasury bills, repurchase agreements, and interbank loans.

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    66 views11 pages

    AE 322 Financial Markets: Mrs. Carazelli A. Furigay, Mba

    Uploaded by

    DJUNAH MAE ARELLANO
    Financial markets are physical or electronic forums that facilitate the flow of funds among investors, businesses, and governments. They provide a mechanism for allocating financial resources from savers to those demanding funds. Major financial markets include securities markets for trading debt and equity, derivatives markets, mortgage markets, and currency exchange markets. Within securities markets, there are money markets for short-term securities and capital markets for long-term securities over one year. Primary markets involve new issuances while secondary markets facilitate trading of existing securities through organized exchanges or over-the-counter networks. Common money market instruments are commercial papers, treasury bills, repurchase agreements, and interbank loans.

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    AE 322

    FINANCIAL MARKETS
    MODULE 3
    MRS. CARAZELLI A. FURIGAY, MBA
    OVERVIEW OF FINANCIAL MARKETS
    ➢ physical or electronic forums that facilitate the flow of funds (transfer of financial
    assets) among investors, businesses and government. It provides the mechanism for
    allocating financial resources or funds from savers to demanders of funds.

    2
    MARKET MAKER

    Dealers
    INSTITUTIONAL
    market makers
    Retail market
    makers

    3
    MAJOR FINANCIAL
    MARKETS

    1. SECURITIES Markets – where debt


    and equity securities are traded
    2. DERIVATIVES Market - where
    derivative securities are traded
    3. MORTGAGE market – where
    mortgage loans, backed by real
    properties are originated and traded
    4. CURRENCY Exchange Market –
    where banks & other institutional traders
    buy and sell various currencies on
    behalf of business and other clients.

    4
    SECURITIES
    MARKETS

    5
    A. MATURITY OF SECURITIES ISSUED

    MONEY MARKET CAPITAL MARKETS


    – where short term securities are where long term securities (maturity
    traded. > 1 year) are traded.

    6
    B. TIMING OF ISSUANCE

    PRIMARY MARKET SECONDARY MARKET


    a. RIGHTS OFFERING (pre –emptive a. ORGANIZED SECURITIES EXCHANGE*
    right of stockholders) – where the – a centralized institution where
    new (additional) shares of stocks are transactions of already outstanding
    securities are made.
    offered first to existing stockholders
    on a pro rata basis. b. OVER THE COUNTER (OTC) market -
    not an institution but a widely
    b. PRIVATE PLACEMENT – where new scattered telecommunications
    shares of stocks are sold directly to a network thru which buyers & sellers
    selected investor. of certain securities are brought
    together.

    7
    MAJOR FINANCIAL
    MARKET INSTRUMENTS

    8
    1. MONEY MARKET INSTRUMENTS

    A.COMMERCIAL PAPERS

    1. PROMISSORY NOTES
    2. DRAFTS
    a. BANKER’S ACCEPTANCE
    -a short term debt instrument issued by the
    b. TRADE ACCEPTANCE
    National Government to be paid thru the
    3. NEGOTIABLE CERTIFICATE OF National Treasury
    DEPOSIT

    B. TREASURY BILL

    9
    1. MONEY MARKET INSTRUMENTS

    C. REPURCHASE AGREEMENTS

    an instrument sold by a dealer of securities


    to a buyer (investor) wherein the dealer
    promises to buy the same instrument
    (securities) from the buyer, in a future date an overnight loan granted by a bank to
    and price specified (fixed) in the agreement. another bank to meet the daily bank reserve
    required by the central bank (BSP).

    D. INTERBANK LOANS

    10
    THANK YOU!
    FLORA@CONTOSO.COM

    HTTP://WWW.CONTOSO.COM/

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