Role Flashcards
what has weighed on profitability of brokers catering to small and mid-size companies
tougher market for IPOs,
move to automated share trading,
Mifid || forced them to set up new costly systems for monitoring trades and to charge separately for research and trading, hurting research revenues
general issues hurting profits of brokers
heightened regulatory and technology costs, fee reductions from a move to automated share trading and slower growth
quote saying that equity broking is changing, what does it say about the survivors
the survivors will be required to have a very low fixed cost base
which two brokers have had interest from large overseas banks
Peel Hunt and Liberum have attracted attention from big overseas banks such as Santander and Macquarie
what is a money market fund
open-ended mutual fund that invests in short-term debt securities such as US T-bills and commercial paper
what are some features of over-the-counter markets compared to exchanges
decentralised,
liquidity and transparency are limited
what role do inter-dealer brokers take on in over-the-counter markets *
provide pricing information/discovery, liquidity, and privacy for their trading actions
what is another function provided by IDBs during times of market stress
IDBs are often only players willing to buy securities that appear to be undervalued and take the risk that the market will return to a more stable level. critical to maintaining liquidity during extreme times
how does an IDB actually improve price discovery and transparency
by posting a bid, offer and size of available securities for trading (locate and identify trading interest).
This assists with flow of information and provides market liquidity and efficiency where there are not many players
what are dealers given by using an interdealer broker
anonymity and privacy
