Capital Markets and Investment Banking Process Paper

describe how the factors of safety, risk, income, growth, and liquidity affect that investment alternative.

Investment Banking is now at a crucial junction, where Investment and Commercial Banking are splitting up due to the ring fence which is being built around these two banking areas. As well, the new upcoming regulation, Basel III, will have a huge impact in the investment banks, with higher liquidity and capital requirements, in order to increase solvency and stability in financial industries.

An investment that is not one of the three traditional asset types such as stocks, bond and cash are considered as an alternative investment. “These types of investments include hedge funds, managed futures, real estate, commodities and derivative contracts.” (www.investopedia.com). These are subject to less regulation and use leverage and derivative instruments to optimize their returns. “In spite of many pensions and private endowments beginning to invest in these funds, the portion apportioned to them is still small usually less than 10%.” (www.investopedia.com). An alternative investment differs from publicly traded investments in three main ways:

Corporate bonds are one of the main products of the fixed income market. These instruments have similar features that of a bank loan, except that they can be transferrable from one lender (investor) to another, and can be traded in market which is known as corporate bond market. Trading is performed either on price or yield basis. Bond usually trades either at premium or at discount to its face value. The quality of the bond is derived from creditworthiness of the company or default risk. Based on potential default risk, bonds are evaluated on credit rating

Financial statements for banks have uniquely different analytical problem than statements for manufacturing, service and most companies in general. Therefore this analysis of JPMorgan and Chase 's financial statements requires a different approach in order to recognize the banks worth as an investment.

The Federal Deposit Insurance Corporation, the institute in charge of regulating commercial banks, became burden with an innovative need to assess the expanding investment activity of the commercial banks. The Federal Deposit Insurance Corporation had previously been assigned the easy task of assessing the commercial banks, within

The ways I used diversification in my portfolio will most likely help you in yours! Diversification has barely any disadvantages, that will be completely unnoticeable when you start making your money. Since diversification has so many advantages why don’t you start using it to get started on your stock market career. Without a doubt, diversification will help you achieve your goals in the stock market along with the millions of other people that use it as

In this paper I will outline the fourteen financial terms and roles for the following words finance, efficient market, primary market, secondary market, risk, security, stock, bond, capital, debt, yield, rate of return, return on investment and cash flow and identify their roles in finance in today’s business world.

Debt securities include very debt tool that is available for buying and selling inside two groups and have understanding of some common terms like the notional amount or also known as the borrowed amount, maturity or renewal date and interest rate. Debt securities involves corporate, government and municipal bonds, CDs, collateralized securities ( like CDOs, CMOs, GNMAs) and zero coupon securities. (Investopedia, 2015). On the financial records, the debt securities are documented in the type of bonds, collateralized securities and preferred stocks.

The sector has become an important component of a balanced investment portfolio in recent times.

A diverse portfolio means you may have money in savings accounts, commodities, futures, private businesses, etc. A less-safe portfolio may only have money in one area such as in a private business or in stocks. If you have a diverse portfolio on a macro level, then it means you can absorb loss and still come out on top.

Swedroe and Kizer define alternative investments as those outside “the familiar categories of equities; treasury bonds; other high quality, investment-grade debt; and bank instruments such as certificates of deposit” (p. xxiii). Alternative investments are less regulated and include hedge funds, managed futures, real estate, commodities and derivatives. Among the five funds, none can be classified as an alternative investment.

Almost any type of investment is permissible inside the portfolio including stocks, bonds, mutual funds, annuities, unit investment trusts(UITs), and exchange-traded funds(ETFs). Even qualified plans are allowed to hold most any type of security as well, although mutual funds, annuities and company stock tend to be the three primary vehicles used in these plans for various reasons.

Corporate securities and government securities constitute important investment avenues for investors. These are traded in the securities market. The securities market is one of the most important sectors in the financial system of our country. And also contributes much for the economic development. So

Agricultural land is a great diversification tool for investment when related to equity and bond markets.