金融市场学双语ppt课件C01 Powerpoint .ppt

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1、,Financial Markets and Institutions6th Edition,PowerPoint Slides for:,By Jeff MaduraPrepared by Paul WongDepartment of Finance, Shanghai Lixin University of Commerce,1,Role of Financial Markets and Institutions, 2003 South-Western/Thomson Learning,Chapter Objectives,Describe the types of financial m

2、arketsDescribe the role of financial institutions with financial marketsIdentify the types of financial institutions that facilitate transactions,Overview of Financial Markets,Financial markets provide for financial intermediation-financial savings (Surplus Units) to investment (Deficit Units)Financ

3、ial markets provide payments systemFinancial markets provide means to manage risk,Financial Market: a market in which financial assets (securities) such as stocks and bonds can be purchased or sold,Broad Classifications of Financial MarketsMoney versus Capital Markets Primary versus Secondary Market

4、sOrganized versus Over-the-Counter Markets,Overview of Financial Markets,Primary vs. Secondary Markets,PRIMARYNew Issue of SecuritiesExchange of Funds for Financial ClaimFunds for Borrower; an IOU for Lender,SECONDARYTrading Previously Issued SecuritiesNo New Funds for IssuerProvides Liquidity for S

5、eller,Money vs. Capital Markets,MoneyShort-Term, 1 YearHigh Quality IssuersDebt OnlyPrimary Market FocusLiquidity Market-Low Returns,CapitalLong-Term, 1Yr Range of Issuer QualityDebt and EquitySecondary Market FocusFinancing Investment-Higher Returns,Organized vs. Over-the-Counter Markets,OrganizedV

6、isible MarketplaceMembers TradeSecurities ListedNew York Stock Exchange,OTCWired Network of DealersNo Central, Physical LocationAll Securities Traded off the Exchanges,Money Market SecuritiesDebt securities OnlyCapital market securitiesDebt and equity securitiesDerivative SecuritiesFinancial contrac

7、ts whose value is derived from the values of underlying assetsUsed for hedging (risk reduction) and speculation (risk seeking),Securities Traded in Financial Markets,Debt vs. Equity Securities,Debt Securities: Contractual obligations (IOU) of Debtor (borrower) to Creditor (lender)Investor receives i

8、nterestCapital gain/loss when soldMaturity date,Debt vs. Equity Securities,Equity Securities: Claim with ownership rights and responsibilitiesInvestor receives dividends if declaredCapital gain/loss when soldNo maturity dateneed market to sell,Valuation of Securities,Value a function of:Future cash

9、flowsWhen cash flows are receivedRisk of cash flowsPresent value of cash flows discounted at the market required rate of returnValue determined by market demand/supplyValue changes with new information,Investor Assessment of New Information,Exhibit 1.3,Security prices reflect available informationNe

10、w information is quickly included in security pricesInvestors balance liquidity, risk, and return needs,Financial Market Efficiency,Financial Market Regulation,To Promote EfficiencyHigh level of competitionEfficient payments mechanismLow cost risk management contracts,Why Government Regulation?,To M

11、aintain Financial Market StabilityPrevent market crashesCircuit breakersFederal Reserve discount windowPrevent Inflation-Monetary policyPrevent Excessive Risk Taking by Financial Institutions,Financial Market Regulation,Why Government Regulation?,To Provide Consumer ProtectionProvide adequate disclo

12、sureSet rules for business conductTo Pursue Social PoliciesTransfer income and wealthAllocate saving to socially desirable areasHousingStudent loans,Financial Market Regulation,Why Government Regulation?,Financial Market Globalization,Increased international funds flowIncreased disclosure of informa

13、tionReduced transaction costsReduced foreign regulation on capital flowsIncreased privatizationResults: Increased financial integration-capital flows to highest expected risk-adjusted return,Role of Financial Institutions in Financial Markets,Information processingServe special needs of lenders (lia

14、bilities) and borrowers (assets)By denomination and termBy risk and returnLower transaction costServe to resolve problems of market imperfection,Role of Financial Institutions in Financial Markets,Types of Depository Financial Institutions,CommercialBanks$5 TrillionTotal Assets,Savings Institutions$

15、1.3 TrillionTotal Assets,Credit Unions$.5 TrillionTotal Assets,Types of Nondepository Financial Institutions,Insurance companiesMutual fundsPension fundsSecurities companiesFinance companiesSecurity pools,Role of Nondepository Financial Institutions,Focused on capital marketLonger-term, higher risk

16、intermediationLess focus on liquidityLess regulationGreater focus on equity investments,Trends in Financial Institutions,Rapid growth of mutual funds and pension fundsIncreased consolidation of financial institutions via mergersIncreased competition between financial InstitutionsGrowth of financial conglomerates,Global Expansion by Financial Institutions,International expansionInternational mergersImpact of the single European currencyEmerging markets,