Capital Markets and Investment Banking Process Paper

Investments. “The analysis and process of choosing securities and other assets to purchase.” (Cornett, Adair, & Nofsinger, 2016, p. 7).

I am a junior at New York University’s Stern School of Business studying finance and management. Through my studies, activities, and work experiences, I have developed a passion for finance, particularly the quantitative and analytical aspects of high level financial strategy. I greatly enjoy the challenges of bringing together disparate information to create valuable insights and supporting qualitative observations and analyses with data through models and data analysis. Though I lack direct investment banking experience, I know that these skills, which I hope to continue building upon, are critical components to serving as part of a team of strategic advisors on the most pressing and complex aspects of corporate strategy. I believe that a role in investment banking will enable me to challenge myself in new ways and grow exponentially.

Bonds are built on debt instead of equity. They promise to pay the principal amount of the bond on a specific date. So basically, it makes the owner a lender and only pays interest to the owners/bondholders. It also requires that the owner pay a fixed interest payment every six months. A large majority of corporations do not issue bonds.

There are several capital market instruments used by investors to make a profit. These capital market instruments include: debentures, bonds, stocks, fixed deposits, T-bills, foreign exchange and many others. The aforementioned capital market instruments are responsible for producing funds for firms and sometimes national governments. Two basic capital market instruments are stocks and bonds. Stocks are used in three different markets as the capital market instrument: the virtual, the physical, and auction markets. Bonds are traded in a separate bond market, also known as a credit, debt or fixed income market (Mapsofworld.com, 2009). In this market is also trade in debt securities, T-bills and debentures, which are more secured than others, however, they provide less return also.

The two principal areas of business in investment banking are the ‘sell side’ which involves trading and promoting securities, facilitating

In conclusion, I have depicted the different types of asset classes for the mutual fund I selected as well as the Dow 30 organization. An asset class exists so that it can provide a structure to the vast array of financial instruments that are available in today 's financial market (Investopedia, 2006). As with any types of investments, they all has its risks and rewards and it is a matter of understanding how they are classified as well as its current investment environment.

* Analyze the factors that influence investment decisions at different stages in an investor’s life cycle, and make a recommendation at which stage the average investor should consider financial investments. Provide support for your recommendation.

Every single investment requires decision making. The result of decision making without certain planning might not end well. One cannot simply make a decision by relying on his/her personal resources as the decision may give an impact to the investments. It is difficult to make decision which is related to the field of investments. Investors have to consider their risks, market condition, rate of return, and others in making their investment portfolio. However, there are many possible physiological biases that make investors become irrational thus making bad decisions for the investment.

o secondary markets are categorized by physical location exchanges or computer networks and also by the way orders from buyers are sellers are matched and electronic communication networks

Recent studies show that they are different definitions and purpose of asset allocation within different groups of investors. For professional investors, asset allocation usually means (i) calculating the rates of return between various asset classes, (ii) running these variables to select asset mixes with different risk and return profiles; and (iii) analyzing and implementing the desired asset allocation. Whilst

Each division serves a different purpose. Capital Markets department focuses on equity, fixed income, municipal, and loans. Capital Market uses premier new issuance systems with data to enable clients to execute deals more efficiently that will increase and get more out of their time and money. New issuance software includes bookbuilding system, roadshows and conference management, and electronic document delivery. All the applications are web based so this provides clients with smooth access to important data. Also under capital markets, investor prospecting solutions provide the most accurate and comprehensive institutional contact and profiles within the

Stock exchange or stock market is an organized and regulated financial market where securities such as bonds, notes and shares are bought and sold at prices governed by the forcesof demand and supply. Stock exchanges basically serve as primary markets and secondary markets. The primary market is where corporations, governments, municipalities and other incorporated bodies can raise capital by channeling savings of the investors into productive ventures and secondary markets is where investors can sell their securities to other investors for cash, thus reducing the risk of investment and maintaining liquidity in the system.

Investment banking is a highly regulated and complex sector that can be broken down into three main principle businesses comprising of the Investment Banking Division, Trading Division and Asset Management. First of all, the investment banking division can be sub divided into two basic groups called product group and client coverage group. The primary focus of these two groups are to perform mergers and acquisitions transaction advisory and financing arrangement for clients. The two main groups in the product group are the mergers and acquisitions group and the capital markets group. In the mergers and acquisitions group, there are five main products which is the “sell side” assignment, “buy side” assignment, merger of equals joint venture, public market separation and hostile defense. The “sell side” transaction involves the sale, merger or disposition of an entire company or any of its divisions and assets. The “buy side” transaction involves the purchase of an entire company or any of its divisions and assets. The “sell side” transaction typically have the highest priority due to its higher probability of completion compared to the “buy side” transactions. Merger of equals joint ventures is the merging of two companies of roughly equal assets that have a comparable market value. This allows the two companies to form a new and stronger entity to initiate economic activity together with their shared assets. Public market separation requires reorganization such as trading

To make sensible investment decisions, a good financial analyst should use a method that considers all of the costs and benefits of each investment opportunity, and makes a logical allowance for the

An investment also known as a security is a pledge of money from an individual, government, or cooperation that is expected to accrue additional wealth on top of its original dollar amount. An investment can be a long-term or short-term obligation depending on the investor’s goals and/or assets they choose to invest in. The investment decision process is a two-step process which is necessary to make a sound trustable and efficient investment. The first step involves an evaluation of the investment you as the investor are interested in committing money towards, including characteristics of the security (i.e. how it acts in the current market, how the current/future market may react to this investment and possible returns on your investment). Finally, the management of your investment portfolio, including how often it should be revised, how the performance of your securities should be measured (how often they should be measured), and other important aspects of your current investments. Investing revolves around one basic concept, improving our future, investors invest money today to improve their welfare in the future which is why understanding what an investment is and the process of decision making before investing is extremely important.