chapter 2 financial markets and institutions 金融市场 金融机构课件.ppt

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IntroductiontoFinance–ACF108Session02:FinancialMarkets&Institution FundamentalsofCorporateFinanceSixthEditionRichardA.BrealeyStewartC.MyersAlanJ.MarcusSlidesbyMatthewWillChapter2McGrawHill/IrwinCopyright©2009byTheMcGraw-HillCompanies,Inc.AllrightsreservedFinancialMarketsandInstitutions TopicsCoveredTheImportanceofFinancialMarketsandInstitutionsTheFlowofSavingstoCorporationsFunctions:-FinancialMarketsand-FinancialIntermediaries FinancialMarketsFinancingDecisionSourceofFunds(Capital)CapitalStructure4 SourceofFundsFinancing:-FinancialMarkets-Institution Why-FinancialMarketsBuyingandSellingofFinancialproductProvidefinancingtothecorporationChannelingFundsfromsaverstoborrowers What–Financialmarket?Anymarketplacewherebuyersandsellerstradeinassetssuchasequities,bonds,currenciesandderivativesFeatures-Transparentpricing,basicregulationsontrading,lowcostsandfeesMarketforcesdeterminingthepricesofsecuritiesthattrade FinancialInstitutionInstitutionthatprovides financialservices foritsclientsormembersMostimportantfinancialserviceprovidedbyfinancialinstitutionsisactingas financialintermediaries Relationships-FinancialmarketandInstitutionEachfinancialmarketisservedbyfinancialinstitutionsthatactasintermediaries TheFlowofCapital:10 ChannelingFundsBorrowers-corporationsorinvestorswhohastheopportunitytomakeextrareturnstothemoneytheyborrowSavers–PeoplewhohasnottimetoinvestSmallamountofmoney FunctionofFinancialMarketsTransportingcashacrosstimeRisktransferanddiversificationLiquidityPaymentmechanism-systemusedfortransferringmoneyProvideinformation FunctionofFinancialMarketsTransportingcashacrosstime-Saverscansavemoneynowtobewithdrawnandspentatalatertime,-BorrowerscanborrowcashtodayLiquidity-Abletoconverttheirinvestmentsintocashquicklyandeasily PaymentMechanismUseinsteadofcash indomesticandinternationaltransactionsTheseinclude:Debitcards, creditcards, electronicfundstransfers, directcredits, directdebits, internetbanking ande-commercepaymentsystems ProvideInformationMarketsprovideextensivedatasuchas:-Interestratesforawidearrayofloansandsecurities,U.S.governmentbonds-Foreignexchangerates.-Stockpricesandoverallmarketvaluesforpubliclylistedcorporations InformationProvidedInformationProvidedbyFinancialMarketsCommoditypricesInterestratesCompanyvaluesCreditRatingInterestRateAAA5.71%AA5.78A6.38BBB7.12BB9.84B10.82Source:BloombergCompositeCorporateBondIndexes.Interestrateson30-yearcorporatebonds,February2008. FinancialMarketsPrimaryMarketsSecondaryMarketsOTCMarketsMoney Types-FinancialMarketsPrimarymarket-Theinitialsaleofsecuritiesorinitialpublicoffering(IPO)-involvesinvestmentbanksSecondarymarkets.-Existingsaleofsecuritiesinfinancialmarkets,betweeninvestors-Brokers,dealer,investmentbanks PrimaryMarketsTheprimarymarketisthatpartofthecapitalmarketsthatdealswiththeissuanceofnewsecurities.Companies,governmentsorpublicsectorinstitutionscanobtainfundingthroughthesaleofanewstockorbondissue. SecondaryMarketAlsoknownastheaftermarket,isthefinancialmarketwherepreviouslyissuedsecuritiesandfinancialinstrumentssuchasstock,bonds,options,andfuturesareboughtandsold FinancialMarketsCompanyIssueSecuritiesCashInvestorsCashReinvested TypesFinancialMarketsStockmarketsFixed-incomemarketsMoneymarketsMarketsfor-Commodities-Foreignexchange-Derivatives FinancialInstitutionsCompanyIntermediariesBanksInsuranceCos.BrokerageFirmsObligationsFunds FinancialIntermediaryIsafinancialinstitutionthatconnectssurplus(savers)anddeficit(borrowers)agents.AssetTransformation-bankthattransformsbankdepositsintobankloansExample:-MutualFunds,Pensionfunds-Banks,Insurancecompanies. FunctionFinancialIntermediary1.Channelingfund2.Economiesofscale3.LowerTransaction4.Specialization FinancialInstitutionsIntermediariesInvestorsDepositorsPolicyholdersInvestorsObligationsFunds FinancialMarketsBankofAmericaExplorerFundInvestors$$SellssharesIssuesshares FinancialMarketsFundsFundsBanksInsuranceCos.BrokerageFirmsObligationsDepositorsPolicyholdersInvestorsObligationsCompanyIntermediaryInvestor FinancialMarketsBanksDepositors$2.5milCashLoanDepositsCompanyIntermediaryInvestor FinancialMarketsInsuranceCompanyPolicyholders$2.5milCashIssueDebtSellpoliciesCompanyIntermediaryInvestor DifferencesFinancialintermediariessuchasmutualfundsandpensionfundspoolandinvestsavingsinfinancialassets.Financialinstitutionssuchasbanksorinsurancecompaniesraisemoneyinvariousways—forexample,byacceptingdepositsorsellinginsurancepolicies FinancialInstitutionTheynotonlyinvestinsecuritiesbutalsolenddirectlytobusinesses.Theyalsoprovidevariousotherfinancialservicessuchaspaymentandriskmanagementservices DirectFinancingAnyfinancingtransactionwherethereisnointermediarybetweenthelenderandtheborrowerWheresecuritiesaresolddirectlytoinstitutionallendersorinvestorsandthecostofunderwritingisbeingavoided,thetermsdirectplacementandprivateplacementareinterchangeablyused. TotalU.S.Financing%HoldingsofCorporateandForeignBonds(Qtr3,2007) TotalU.S.Financing%HoldingsofCorporateEquities(Qtr3,2007) ValueMaximizationIncreasesinowners'wealthachievedbymaximizingofthevalueofafirm'scommonstockHowFinancialmarket&Institutionenhancevalueforcorporation? ValueMaximization ValueandValueAdded SummaryTheImportanceofFinancialMarketsandInstitutionsTheFlowofSavingstoCorporationsFunctions:FinancialMarketsandFinancialIntermediaries