BELL WORK What is the meaning of the cartoon?. VU NGUYEN FINANCIAL INTERMEDIARIES.

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Presentation transcript:

BELL WORK What is the meaning of the cartoon?

VU NGUYEN FINANCIAL INTERMEDIARIES

INVESTMENTS Redirecting your resources to create benefits in the future. m/watch?v=pYjTPLuNiok om/watch?v=OjJRwbk otQM

FINANCIAL INTERMEDIARY An institution that acts as an agent or broker by accepting money from people who wish to save money and giving it to those who want to borrow money.

DEPOSITORY INSTITUTIONS Commercial banks. Savings and loans. Credit unions.

COMMERCIAL BANKS

WHAT BANKS CAN OFFER Savings (Checkings or savings account). Loans (Lending money to borrowers). Mortgages (Loan for the purchase of real estate). Credit Cards (Allow people to buy goods with a promise to pay later).

SAVINGS AND LOANS

CREDIT UNIONS Specialize in mortgages and car loans. Serve members of a credit union only not general public. Not-for-profit organizations.

NON-DEPOSITORY FINANCIAL INSTITUTIONS Finance companies. Life Insurance Companies. Pension Funds. Retirement Accounts. Financial Markets.

FINANCIAL COMPANIES Provide loans to households and businesses. Does not accept deposits from public. Use money from stockholders.

LIFE INSURANCE COMPANIES

PENSION FUNDS Accumulation of money from employees and/or employers.

RETIREMENT ACCOUNTS Not pensions. 401k. Individual Retirement Accounts (IRAs). Keogh Plans

DIVERSIFICATION Spreading out investments to reduce risk

DIVERSIFICATION To spread investment into a variety of assets.

BELL WORK What is the meaning of the cartoon?

FINANCIAL MARKETS Stocks Treasury Bills and Notes Bonds

STOCKS A way for corporations to make large amounts of money to reinvest in the business.

CAPITAL GAIN AND LOSS Gain- the difference between the higher selling price from the purchasing price Loss-Selling at a lower price than the purchasing price

STOCKBROKERAGES Stock brokers can buy or sell, advise customers what to buy or sell, or have complete authority over investments. Shares

STOCK EXCHANGES Markets for buying and selling stock. Examples: New York Stock Exchange and Nasdaq

BULL AND BEAR MARKET Bull Market- When stock market rises steadily over a period of time Bear Market- When stock market falls for a period of time

TREASURY BILLS AND NOTES A way for government to borrow money. T-bills or T-notes

BONDS Issued by governments or corporations to borrow money for long periods. Different ratings (AAA, AA, A). Can be sold before maturity.

MUTUAL FUND COMPANIES Financial institutions that pool together funs from large number of people. These funds are used to invest in financial assets, bonds, real estate, and stocks.

CERTIFICATE OF DEPOSITS Issued by banks

FINANCIAL RISK Credit risk Liquidity risk Inflation risk Time risk

SMARTSTOCKS.COM When you are advised to do so, get a computer from the mobile computer lab and go on smartstocks.com. You will buy, sell, or trade stocks and document your progress. &lid= &ID=930127