金融市场英文课件

Chapter 1 Functions of Financial MarketsChapter 2 Money MarketsChapter 3 Capital MarketsChapter 4 Foreign Exchange MarketsChapter one functions of financial marketsWhat is finance?The act of providing money,capital or other financial resources to assist in facilitating a loan or a sale.This term is commonly used within the financial industry,which includes areas such as banking and accounting.The functions of financial marketuFacilitate the flow of funds from surplus units to deficit ones.uFacilitate financing and investing in turn,the lenders expect some compensation(interest or dividends)uFacilitate the raising of capital(in the capital market),the transfer of risk(in the derivative market),and international trade(in the foreign exchange market)Chapter TwoMoney MarketsDefinition of money marketMoney market:is a financial market in which only short-term debt instrument(maturity of less one year)are traded(notes,bonds,certificates,mortgages,leases).Characteristics of money market instruments Sold in large denomination The financial instruments mature in one year(most instrument mature in less than 120 days);have low default risk;Types of instruments in the money market:a.Treasury Bills(T-bills)b.Inter-bank marketsc.Commercial paper tes d.NCDs or CDs(a bearer instrument)e.Banks acceptancef.Repo(repurchase agreement)g.EurodollarsFunctions of money marketlMoney market is important for promoting the liquidity of capital because it allows the companies with a temporary cash surplus to invest in short-term securities and the companies with a temporary cash shortfall to borrow funds on a short-term basisChapter ThreeCapital MarketThe definition Capital market:is a market in which long-term debt(maturity of one year or longer)and equity instrument are trade(stock,long-term debt).The characteristics of capital market usually used for longer-term investment projects higher risk and higher incomeTrading in the capital market Primary market Secondary marketTypes:The stock marketThe bond marketThe fund marketBonds Treasury bonds:Treasury bills,notes and bonds are sold by Treasury Department of a country.These are the safest investments in the world,since they are backed by the Government.Since they are so safe,they tend to have the lowest interest rates.Corporate bonds:Corporate bonds are issued by various corporations to raise capital to reinvest in their operations.For these companies,bonds are relatively safe and cost-effective.The alternative is to go public and raise equity by selling stocks.This is a long and expensive procedure.Selling bonds,while still complicated,is relatively much easier and provides a quicker way to raise capital for corporate expansion.How are bonds traded?Bonds are usually offered at public auctions for government bonds and over-the-counter(OTC)markets that are decentralized for corporate bonds.Investors wishing to buy and sell bonds typically do so through brokers,or those authorized and licensed to trade on an investors behalf.Stock A share of a company held by an individual or group.Corporations raise capital by issuing stocks and entitle the stock owners(shareholders)to partial ownership of the corporation.Stocks are bought and sold on what is called an exchange.There are several types of stocks and the two most typical forms are preferred stock and common stock.How are stocks traded Stocks are originally issued by corporations in initial public offerings(IPOs)in what are called primary exchanges.They are then sold and re-sold in secondary changes.How do stock holders make a return on their investment buy a stock low,and sell it high;the company pays a dividend.These are usually quarterly payments distributed to stockholders on a per share basis.The companys board of directors pays dividends out of earnings.NewYork Stock ExchangeStock market boardThe inside of Stock exchange(Hong kong SE)B:hello,sir,what can I do for you?C:can I buy gold bar here?B:certainly.we are the designated selling office for the brand of“ruyi bullion”.“ruyi bullion”is ICBCs sell-designed brand.C:how about the purity of these gold?B:au 999.9 the gold bar bears“ICBC”and a reference number,and is cast by a qualified gold refinery authenticated by Shanghai Gold Exchange.You can be assured of its quality.C:what is the weight of one gold bar?B:we have five different types:50g,100g,and 1000g.C:how much is per gram?B:gold price fluctuated everyday,and we sell at the quoted price.Look at the screen over there,please.Todas quoted price is yuan per gram,the minimum fluctuating is 0.01 gram.C:oh,I see.Then I will buy a 50-gram bar.B:OK,please fill up the form and confirm todays prevailing priceChapter 4 Foreign Exchange MarketDefinition of foreign exchange marketForeign exchange(forex,FX)the buying of one unit of currency with that of another country.The system utilized in financing international payments;The media used to discharge international obligations;The rates at which foreign exchange is quoted.Purposes(functions)of FX market Transfer of payments The provision of credit Payment at a distance Allowing hedging against exchange risksThere is no single,physical place where purchases and sales are executed.FX transactions are executed by phone or telex.(FX market is a virtual market,having no centralized place.The transaction is unceasing and changing the wealth of people.)Foreign exchange rate is the amount of the foreign currency that is equal in value to a unit of domestic currencypDirect quotationpIndirect quotation（accounts receivable）pAmerican currency quotationThe types of FX ratesBasic exchange rate and cross exchangeNominal exchange and real exchangeSpot exchange and forward exchangeOfficial exchange and market exchangeCharacteristics of FXnPartial convertibilitynCommonly accepted by people around the worldnCan be exchanged for goods or services in foreign countries(reflects the purchasing power)Speaking:Inquiry of foreign exchange rateB:Hello,what can I do for you?C:I need some local currency to cover my spending.What s the exchange rate of RMB against USD today?B:let me see.The buying rate is RMB 702 against USD 100.whats your amount?C:USD 200.B:Please show your passport.C:Here you are.How much is that?B:Wait a minute,please,USD200 can exchange for RMB1404,any requirement for the face amount?C:No requirement.B:Ok,this is your money and exchange slip.please check it.C:Thank you.B:You are welcome