FINC3014 Lecture 1: FINC3014-Notes
Document Summary
Week 2 part i: the structure of trading. Individuals, corporate pension funds, trusts, mutual funds, money managers. Move wealth from the present to the future. Either retail or institutional (defined by >m spend) Farmers, manufacturers, miners, shippers, government owned corporations, financial institutions. Move wealth from the future to the present. Market makers, specialists, floor traders, locals, day traders, scalpers. Retail broekrs, discount brokers, full-service brokers, institutional brokers, block brokers, futures commission merchants (cid:494)wirehouses(cid:495) (name derived from telegraph poles and necessity of being a quick communicator) To earn commissions by arranging trades for clients. Comsec (aus), e*trade (aus), macquarie bank (aus), ubs (aus) Financial assets (assets on a balance sheet, but liabilities for the issuer) Stocks and warrants, bonds, trust units, etfs, currencies. Farmers, miners and manufacturers, investors and artists, builders, government. Characteristics: trading locations, trading hours, counterparties, size of contract, maturity, frequency of delivery, quotes/pricing, margins, settlement. Initial margin that is marked to market on a daily basis.
