1. بسم الله الرحمن الرحیم Financial Markets and Institutions 6th Edition
Jeff Maduraتدریس بر اساس کتاب
مدرس: دکتر حسین صدقی
دکترای اقتصاد مالی از دانشگاه لستر انگلستان
نشر و توزیع: ویدرس
تمامی حقوق محفوظ است

2. Role of Financial Markets and Institutions
CH1
Role of Financial Markets and Institutions

3. Chapter Objectives Describe the types of financial markets
Describe the role of financial institutions with financial markets
Identify the types of financial institutions that facilitate transactions

4. Overview of Financial Markets
Financial markets provide for financial intermediation--financial savings (Surplus Units) to investment (Deficit Units)
Financial markets provide payments system
Financial markets provide means to manage risk
To position risk and return for financial tools(the nature of financial market)

5. Overview of Financial Markets
Broad Classifications of Financial Markets
Money versus Capital Markets
Primary versus Secondary Markets
Organized versus Over-the-Counter Markets

6. Primary vs. Secondary Markets
Trading Previously Issued Securities
No New Funds for Issuer
Provides Liquidity for Seller
PRIMARY
New Issue of Securities(IPO)
Exchange of Funds for Financial Claim
Funds for Borrower; an IOU for Lender

7. Money vs. Capital Markets
Short-Term, < 1 Year
High Quality Issuers
Debt Only
Primary Market Focus
Liquidity Market--Low Returns
Capital
Long-Term, >1Yr
Range of Issuer Quality
Debt and Equity
Secondary Market Focus
Financing Investment--Higher Returns

8. Organized vs. Over-the-Counter Markets
Visible Marketplace
Members Trade
Securities Listed
New York Stock Exchange
OTC
Wired Network of Dealers
No Central, Physical Location
All Securities Traded off the Exchanges

9. Securities Traded in Financial Markets
Money Market Securities
Debt securities Only
Capital market securities
Debt and equity securities
Derivative Securities
Financial contracts whose value is derived from the values of underlying assets
Used for hedging (risk reduction) and speculation (risk seeking)

10. Debt vs. Equity Securities
Debt Securities: Contractual obligations (IOU) of Debtor (borrower) to Creditor (lender)
Investor receives interest
Capital gain/loss when sold
Maturity date

11. Debt vs. Equity Securities
Equity Securities: Claim with ownership
rights and responsibilities
Investor receives dividends if declared
Capital gain/loss when sold
No maturity date—need market to sell

12. Valuation of Securities
Value a function of:
Future cash flows
When cash flows are received
Risk of cash flows
Present value of cash flows discounted at the market required rate of return(CAPM)
Value determined by market demand/supply
Value changes with new information

13. Financial Market Efficiency
Security prices reflect available information
New information is quickly included in security prices
Investors balance liquidity, risk, and return needs

14. Financial Market Regulation
To Promote Efficiency
High level of competition
Efficient payments mechanism
Low cost risk management contracts
Why Government Regulation?

15. Financial Market Regulation
To Maintain Financial Market Stability
Prevent market crashes
Circuit breakers
Federal Reserve discount window
Prevent Inflation--Monetary policy
Prevent Excessive Risk Taking by Financial Institutions
Why Government Regulation?

16. Financial Market Regulation
Why Government Regulation?
To Provide Consumer Protection
Provide adequate disclosure
Set rules for business conduct
To Pursue Social Policies
Transfer income and wealth
Allocate saving to socially desirable areas
Housing
Student loans

17. Financial Market Globalization
Increased international funds flow
Increased disclosure of information
Reduced transaction costs
Reduced foreign regulation on capital flows
Increased privatization
Results: Increased financial integration--capital flows to highest expected risk-adjusted return

18. Role of Financial Institutions in Financial Markets
Information processing
Serve special needs of lenders (liabilities) and borrowers (assets)
By denomination and term
By risk and return
Lower transaction cost
Serve to resolve problems of market imperfection

19. Role of Financial Institutions in Financial Markets
Types of Depository Financial Institutions
Commercial
Banks
Savings
Institutions
Credit Unions

20. Types of Non-depository Financial Institutions
Insurance companies
Mutual funds
Pension funds
Securities companies
Finance companies
Security pools

21. Role of Non-depository Financial Institutions
Focused on capital market
Longer-term, higher risk intermediation
Less focus on liquidity
Less regulation
Greater focus on equity investments

22. Trends in Financial Institutions
Rapid growth of mutual funds and pension funds
Increased consolidation of financial institutions via mergers
Increased competition between financial Institutions
Growth of financial conglomerates

23. Global Expansion by Financial Institutions
International expansion
International mergers
Impact of the single European currency
Emerging markets