Chapter 1 The Financial Services Sector Flashcards
What is an Equity Market?
The trading of quoted or listed shares
What is a bond market?
The trading of government, supranational or corporate debt
What is the FX Market?
The trading of currencies
What is the Derivatives market?
The trading of options, swaps, futures and forwards.
What are the insurance markets?
Major Corporate insurance (including professional indemnity), reinsurance, captive insurance and risk-sharing insurance.
Name 3 Wholesale Activities
Investment banking, equity markets and bond markets.
Name 3 Retail Activities
Retail Banking, Insurance, Pensions.
Key Features of the Equity Markets
IPO’s, ETF’s, Market makers, Dividends.
Name 3 Stock Exchanges
LSE, NYSE, NASDAQ, EURONEXT, Shanghai.
Name 2 Regulators
The SEC (USA) and the FCA (UK)
Rival to Stock Exchanges
MTFs (Multilateral trading facilities) - bring together multiple parties that are interested in buying and selling financial instruments.
Bond Market Movers
Bond Market movement is shaped by interest rates, economic conditions and credit risk.
Name something which the Insurance industry does with risky insurance.
Accepts risk as part of a syndicate, Lloyds of London specialise in this. In this, insurance companies minimise risk and then share profits.
Name 8 of the 12 Major Participants in the Financial Services Sector
Retail Banks
Savings Institutions
Peer-to-Peer (P2P) and Crowdfunding
Investment Banks
Pension Funds
Insurance Companies
Fund Managers
Stockbrokers and Wealth Managers
Custodian Banks
Platforms
Third-Party Administrators (TPA’s)
Trade and Professional Bodies
Name 3 of the 7 Trade and Professional Bodies
Bonds - International Capital Market Association (ICMA)
Derivatives - FIA Europe, International Swaps and Derivatives Association (ISDA)
Fund Managers - Investment Association (IA)
Wealth Management - Personal Investment Management and Financial Advice Association (PIMFA)
Banks - British Bankers Association, Financial Fraud Action UK, Payments UK.
Investment Funds - Tax Incentivised Savings Association (TISA)
