...helps the borrowers to fulfill the need of the money. A financial system helps promotes the wellbeing and also helps in improving the living standards of people. Lets start with the Capital Market in India first. Capital Market is a market in which individuals and institutions trade financial securities. The securities are sold off and bought in capital market for raising the funds (Investopedia, 2013). Capital Market includes both primary and secondary market. Capital market helps in proper channelization of funds and helps raising long- term funds. This kind of market is a continuous market and provides variety of services. The market where new securities are bought and sold for the first time is known as Primary Market. Types of issue in Primary Market may be through public offer (where shares are offered to general public), bonus issue, Follow- on public offers, private placement (intermediaries sell shares to selected clients at higher price), right offer (shares are offered to existing shareholders) etc. It helps in providing additional capital to issuer companies. Secondary Capital Market is a market where existing securities are bought and sold. Secondary market offers liquidity, which encourages even those investors to invest who wants to invest for small period of time. Secondary market is also known as Stock Exchange, which is an organized body of individuals for purpose of controlling and regulating the buying and selling of securities (App-1). In India there are 24...
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...Stock Market and Stock Valuation in Ethiopia Context A capital market is a market for debt or equity securities and other financial instruments, where companies, municipalities and governments can raise long-term funds. It is defined as a market in which money is provided for periods longer than a year, as the raising of short-term funds takes place on the money market. Primary market in Ethiopia has been flourished after the change of the economic assumption from socialist ideology to mixed economy in early 1990s. But, in Ethiopia, as a main deficiency at the time of issuing a new share, there is no benchmark to value the intrinsic value of the stock. The capital market includes the bond market for debt instruments and the stock market for equity securities. Sophisticated capital markets offer derivative financial products such as futures, options and structured products. Capital markets may be classified as primary markets and secondary markets. In primary markets, new bond or stock issues are sold to investors via the mechanism known as underwriting. In the secondary markets, existing securities are sold and bought among investors or traders, usually on a stock exchange (SE), over-the-counter (OTC), or elsewhere. As the main regulator of monetary policy issues, National Bank of Ethiopia, has stated on its official website that secondary Markets for government or private (corporation) company securities have not been established till to date. For the time...
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...Australian business Corporate Law Economic Reform Program Proposals for Reform: Paper No. 1 © Commonwealth of Australia 1997 ISBN 0 642 26110 5 This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Australian Government Publishing Service. Requests and inquiries concerning reproduction rights should be directed to the Manager, Commonwealth Information Services, Australian Government Publishing Service, GPO Box 84, Canberra ACT 2601. The Government is seeking comments from interested parties on the detail of the proposals in this paper which should be forwarded to the following address: First Assistant Secretary Business Law Division The Treasury Parkes Place PARKES ACT 2600 Telephone: 02 6263 3960 Fax: 02 6263 2882 Email: clerp@treasury.gov.au Copies of this paper are available from the Australian Government Publishing Service and on the Treasury web site (http://www.treasury.gov.au). Enquiries concerning the paper can be made to: Ms Veronique Ingram Assistant Secretary The Treasury Telephone: 02 6263 3970 Printed by the Australian Government Publishing Service TABLE OF CONTENTS Page Abbreviations PART 1: PART 2: Reform Proposals Introduction 2.1 2.2 PART 3: Background Key economic principles v 1 9 9 10 11 11 12 13 13 14 16 17 19 19 19 20 22 23 The Case for Reform 3.1 3.2 Impetus for reform What the Government is seeking to achieve PART...
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...international opportunities for Australian business Corporate Law Economic Reform Program Proposals for Reform: Paper No. 1 © Commonwealth of Australia 1997 ISBN 0 642 26110 5 This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Australian Government Publishing Service. Requests and inquiries concerning reproduction rights should be directed to the Manager, Commonwealth Information Services, Australian Government Publishing Service, GPO Box 84, Canberra ACT 2601. The Government is seeking comments from interested parties on the detail of the proposals in this paper which should be forwarded to the following address:| First Assistant SecretaryBusiness Law DivisionThe TreasuryParkes PlacePARKES ACT 2600|Telephone:Fax:Email:|02 6263 396002 6263 2882clerp@treasury.gov.au| Copies of this paper are available from the Australian Government Publishing Service and on the Treasury web site (http://www.treasury.gov.au).Enquiries concerning the paper can be made to:Ms Veronique IngramAssistant SecretaryThe TreasuryTelephone: 02 6263 3970| Printed by the Australian Government Publishing Service Table of Contents Page Abbreviations v PART 1: Reform Proposals 1 PART 2: Introduction 9 2.1 Background 9 2.2 Key economic principles 10 PART 3: The Case for Reform 11 3.1 Impetus for reform 11 3.2 What the Government is seeking to achieve 12 PART 4: Role of Accounting...
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...Internship Report On Effectiveness of DSE Monitoring System SUBMITTED TO: Md. Rafiqul Islam Professor Department of Business Administration Faculty of Business & Economics Daffodil International University SUBMITTED BY: Md. Nasir Uddin ID: 072-11-2038 BBA Department of Business Administration Faculty of Business & Economics Daffodil International University Daffodil International University September 10, 2011 Internship Report On Effectiveness of DSE Monitoring System Date of Submission: 10 September, 2011 4/2, Sobhanbagh, Prince Plaza, Mirpur Road Dhanmondi, Dhaka-1207, Bangladesh LETTER OF TRANSMITTAL August 10, 2011 Md. Rafiqul Islam Professor Internship Supervisor Department of business administration Daffodil International University Subject: Submission of internship report. Dear Sir, This is my pleasure to present my internship report entitled “Effectiveness of DSE Monitoring System” Which was prepared from my experience in Dhaka Stock Exchange. With your kind supervision I believe that the knowledge and experience gathered...
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...[pic] Bangladesh being a developing country, security market is very important source for the growth and development of the industrial section. SEC is working for a healthy economic capital, active administrated securities market. But BSEC it self is not smooth & efficient. There are few problems has been arise after it established. BSEC is working on some new projects and plans. SEC introduce an online database called EDGAR from which investors can access this and other information filed with the agency. In the same online system also takes tips and complaints from investors to help the BSEC track down violators of the securities laws. Apart from the macro policy of contributing to the development of the national economy through harmonization with monetary policy, securities policy dealing with securities houses and markets, generally pursue three broad objectives- Firstly, to improve the efficiency of securities market. Secondly, to ensure the stability and soundness of the financial system. Thirdly, to protect investors rights. In this paper we have shown the history of the organization, in the second section we have shown different functions done by the BSEC, in the third chapter shown types of stock exchange, registered under the BSEC. In the fourth and fifth section we have tried to discuss the different departments of the BSEC and effects of BSEC on the capital market. In the sixth section we have discussed registration and rules & regulation imposed...
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...that have accumulated over the last few years. This primarily concerns disproportions between the scale of financial operations and the fundamental value of assets, as well as those between the increased burden on international loans and the sources of their collateral. … In effect, our proposal implies that the audit, accounting and ratings system reform must be based on a reversion to the fundamental asset value concept. In other words, assessments of each individual business must be based on its ability to generate added value, rather than on subjective concepts. In our opinion, the economy of the future must become an economy of real values. How to achieve this is not so clear-cut. Let us think about it together.” From the Address of Vladimir Putin, Prime Minister of Russia, at the Davos Economic Forum (February, 2009) This Part analyzes the pre-analytical foundations and macro-economic impact of the Modern Portfolio Theory1 (MPT) tenets, on which much of the present Western investment theory and financial economics is erected. Our general inference is that while the former are tautological at their core and treat capital investment pricing processes as if those relate to an impersonal network of natural oscillators, the latter are perceivably dangerous in spite of the belief in the strong ‘performativity’ (self-fulfillment) of MPT (McKenzie, 2006). Performative the MPT may be, but this performativity comes it a cost: as year by year it only removes the universe of traded...
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.....................................................................................9 1.3 MARKET TYPES ....................................................................................................................9 1.3.1 Normal Market..............................................................................................................9 1.3.2 Odd Lot Market.............................................................................................................9 1.3.3 RETDEBT Market .........................................................................................................9 1.3.4 Auction Market............................................................................................................10 1.4 CORPORATE HIERARCHY ....................................................................................................10 1.5 LOCAL DATABASE ..............................................................................................................10 1.6 MARKET PHASES ................................................................................................................11 1.6.1 Opening.......................................................................................................................11 1.6.2 Open Phase .................................................................................................................11 1.6.3 Market...
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...Financial Markets C h a p t e r - 6 59 helped to keep the money market sound and stable during the financial year 2008. A number of steps were taken for activation of secondary trading in treasury bills/bonds. As a result, the overall money market situation was moderate during FY08. Developments in the money market during FY08 are summarized below: Call Money Market 6.3 The volume of transactions in the call money market depicted a mixed trend during FY08 (Table 6.1) reflecting some brisk activities in the money market particularly during the second quarter of the year. It remained sluggish 6.1 A healthy, transparent and dynamically evolving financial system helps mobilize savings and allocate resources, ensure safe and efficient payment and settlement arrangements and ease financial crisis management. Efforts continued in FY08 to establish a healthy and transparent financial system in the country. In addition to the challenges emanating from the internal and external shocks that affected the real sector, there were signs of strain both in the interbank call market and forex market. Volatility in these two markets was tamed through repo operation and intervention by the Bangladesh Bank. Money Market 6.2 Money market, the important segment of financial market that basically channelizes the short term fund in the country was quite active and vibrant with the participation of both banks and non-bank financial institutions during FY08. The...
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...Stock Market Volatility – An International Comparison M. T. Raju, Anirban Ghosh April 2004 Working Paper Series No. 8 Stock Market Volatility – An International Comparison M. T. Raju, Anirban Ghosh Working Paper Series No. 8 The views expressed in this paper are those of the authors and do not necessarily reflect those of the Securities and Exchange Board of India. We sincerely thank Shri G. N. Bajpai, Chairman, SEBI for his unlimited support and encouragement in conducting research work. But for him, it would not have been possible to bring out this paper timely. We also thank many of our colleagues for their comments and suggestions. Contents Foreword Acknowledgement SEBI Abstract 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Stock Market Volatility: An International Comparison Methodology Analysis of Results Inter and Intra-day Volatility Intra-day Volatility and Developed Capital Markets Emerging Capital Markets Indian Market High and Low Volatility (Volatility Transmission) Extreme Volatility Analysis (India) Return Squared Volatility Return Squared Analysis Conclusion and Recommendation References SEBI Working Paper Series (i) (iii) (v) (vii) 1 4 8 11 12 13 13 14 15 15 16 17 19 Foreword During the past few years Indian Capital Market has undergone metamorphic reforms. Every segment of Indian Capital Market viz primary and secondary markets, derivatives, institutional investment and market intermediation has experienced impact of these changes. Our market, today...
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...there be any impact on liquidity or volatility 4 4. Analysis 5 5.Impact on Liquidity 10 Conclusion: 13 References 14 1. Introduction Increasing globalization in the last decade has made Indian financial markets more integrated with the rest of the world. As a result, many Indian companies have gone for raising funds in foreign capital markets by way of issuing ADRs and GDRs. Though cross listing is viewed positively by many corporations, many researchers have shown that changes in liquidity and volatility may affect quality negatively in the domestic markets. Since companies from emerging markets go for raising funds from foreign liquid markets, some policymakers fear that if allowed unrestricted, this may impact the development of local equity markets and hence prove disastrous for emerging markets. Existing studies show that effect of foreign listing depends on factors specific to firms, market and country. Indian GDRs trade on European exchanges and ADRs trade on US exchanges. Also, since US requires higher quality disclosures than Europe, cost of listing in US markets is higher. 2. Regulatory Framework As part of its economic liberalization policy in 1992, Indian government allowed Indian companies to raise money from foreign capital markets in the form of DRs. These DRs can be denominated in any currency and can be listed on any foreign exchange. Recently, government has also allowed two-way fungibility of DRs. Earlier only one way fungibility was allowed...
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...requisite degree of transparency. Demutualised exchanges will be forced to account to their shareholders regarding the bottom line as well as corporate governance. Secondly, there will be more investor participation. The new corporation will be more profit orientated due to shareholder accountability. Unlike a mutual structure where often only broker-dealers maybe members, a demutualised exchange affords both institutional and retail investors the opportunity to become shareholders. A demutualised exchange will have greater flexibility to accommodate the needs of institutional investors as customers, and potentially, as owners. Thirdly, it is the resources for capital investment. A competitive stock exchange must be able to respond quickly to global competitive forces and technological advances. With the capital raised from initial public offerings or private investment and a heightened awareness of accountability to stakeholders, a stock exchange should have both the incentive and the resources to invest in the competitiveness of its information systems. So to be competitive, products and services must not only be timely and cost effective, but also reliable. The second part of the structural changes needs to be at the SEC of Bangladesh. The fundamental issue here is: what is the regulator doing to help minimise risk for the investors? The absolute minimum the SEC can ensure is to have risk minimising tools. As a first step...
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... |greater than a reliable promise to receive the | | | |same amount of money at a future date | | |Efficient market |Market where all pertinent information is |http://www.businessdictionary.com/definition/efficient-| | |available to all participants at the same time, |market.html | | |and where prices respond immediately to available | | | |information. Stockmarkets are considered the | | | |best examples of efficient markets. | | | | | | |Primary versus secondary market|Both the primary market and secondary market are |http://finance.mapsofworld.com/capital-market/primary-v| |...
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...Prepare a glossary for the terms below: Financial market - A financial market is a market in which people trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand. Securities include stocks and bonds, and commodities include precious metals or agricultural goods. Financial instruments - Financial instruments are tradable assets of any kind. They can be cash, evidence of an ownership interest in an entity, or a contractual right to receive or deliver cash or another financial instrument. Financial intermediaries - A financial intermediary is a financial institution such as bank, building society, insurance company, investment bank or pension fund. A financial intermediary offers a service to help an individual/ firm to save or borrow money. Shares/ stocks – Shares/stocks is a share in the ownership of a company. It represents a claim on the company's assets and earnings. As you acquire more shares, your ownership stake in the company becomes greater. Bonds - A bond is a debt investment in which an investor loans money to an entity which borrows the funds for a defined period of time at a variable or fixed interest rate. Bonds are used by companies, municipalities, states and sovereign governments to raise money and finance a variety of projects and activities. Owners of bonds are debt holders, or creditors, of the issuer. Treasury bills - A short-dated government security, yielding no...
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...SWFs has been brought into the spotlight. An ever growing number of SWFs worldwide was thought to precipitate tectonic shifts in global equity and foreign exchange markets. Unlike central banks, the SWFs are more likely to invest in emerging nations rather than the developed countries. Stephen Jen, the managing director and chief currency economist at Morgan Stanley, says that the trend for SWFs to move away from sovereign debt to assets that generate higher returns, including financial, resources, tech, and infrastructure plays, is a natural outcome of the globalization financial markets that seeks to adjust existing global imbalance. Based on the diverse investment nature of SWFs, the global fund industry anticipates huge opportunities to make money off the SWFs. At the same time, SWFs are believed to have a stabilizing role in global markets, helping to resuscitate struggling financial institution. This is based on two prominent features of SWFs. One is its longer investment horizon. The other is its greater tolerance for swings in the balance sheets. Despite the optimistic point of views on SWF, potential problems regarding transparency, potential interference and its effect on currency markets have been revealed. Other challenges faced by SWF are about its conservative nature and apparent impact on capital markets according to Jonathan Anderson, the chief economist at UBS Asia-Pacific. 2) As a business student, it is inevitable for us to read business cases. However, enjoy...
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