Föreläsning 1

Question 1

Vilka är the Key players in financial markets?

Answer 1

• Firms
• Individuals
• Government

Question 2

Vad innebär Direct finance?

Answer 2

Borrowers borrow funds directly from lenders, by selling securities which are claims on the borrower´s future income or assets. These securities are sold in financial markets.

Question 3

Varför är Financial markets important?

Answer 3

Because they allow capital to be allocated where most needed in return everyone is better off.

Question 4

Vad innebär the maturity of a debt instrument?

Answer 4

The number of years until that instrument´s expiration date.

Question 5

När är en investering kortsiktig, medellång sikt eller lång sikt?

Answer 5

Short term if its maturity is less than a year.
Intermediate-term if it´s between one and ten years.
Long term if it´s more than ten years.

Question 6

Vad är en stock?

Answer 6

En claim to share the net income and assets of a business.

Question 7

Vad gör Equities?

Answer 7

Make periodic payments.

Question 8

Vilka två källor till return finns det som investerare?

Answer 8

• dividens
• capital gain.

Question 9

Vad har du för rättigheter om du äger en stock i ett bolag?

Answer 9

• Right to vote on important issues
• elect its directors.

Question 10

Vad finns det för Disadvantage och advantage of owning a corporation´s equities instead of debt?

Answer 10

Företaget måste betala sin skuld innan sina equity holders med de får del av alla ökningar i profitability.

Question 11

Vad är en primary market?

Answer 11

Financial market in which NEW issues of a security are sold to initial buyers.

Question 12

Vad är en Secondary market?

Answer 12

Financial market in which securities that have been previously issued can be resold.

Question 13

Vilka hjälper till vid IPOs och hur?

Answer 13

Investment banks, they buy issued securities at a guaranteed price and sells to the public.

Question 14

Nämn ett par exempel på Secondary markets?

Answer 14

NASDAQ(US) , OMX(Sverige)

Question 15

Vilka två sätt kan Secondary markets vara organiserade på?

Answer 15

• exchanges
• Over-The-Counter (OTC) markets.

Question 16

Vad är en exchange market?

Answer 16

Typically sells standardized contracts such as shares in a company or futures/options. (NASDAQ). Trades between buyers and sellers are typically facilitated by a clearing house.

Question 17

Vad är ett clearing house?

Answer 17

It finalizes and validates transaction and make sure that both parties honor their contractual obligations. In stock markets their role is to make sure that sellers receive money

Question 18

Vad är OTC markets?

Answer 18

Are decentralized. Tailored contracts between two parties are typically traded on OTC markets. Transactions in OTC markets usually involve counterparty or settlement risk as they are not facilitated by a clearing house.

Question 19

Varför behövs financial intermediates på kapitalmarknaden?

Answer 19

Because individuals do not borrow directly from firms and vice versa. Financial intermediates stand between savers and borrowers.

Question 20

Vad är viktigast, indirect eller direct finance?

Answer 20

Indirect finance