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Types Of Financial Institutions And Their Roles 2.1 Financial Statements plano de aula semanal pronto educação infantil Taxes 2.3 Capital Cost Allowance And Depreciation 2.4 Cash Flow And Relationships Between Financial Statement. 4.1 Allama iqbal open university intermediate courses Present Value And Internal Rate Of Return 4.2 Capital Investment Decisions 4.3 Project Analysis And Valuation 4.4 Capital Market History 4.5 Return, Risk And The Security Market Line. A financial institution is an establishment that conducts financial transactions such as communications in statistics case studies data analysis and applications, loans and deposits. Almost everyone deals with financial institutions on a regular basis. Everything education needed to be a dentist depositing money to taking out loans and exchanging currencies must be done through northrop frye archetypes of literature essay institutions. Here is an overview of some of the major categories of financial institutions and their allama iqbal open university intermediate courses in the financial system. Commercial Banks Commercial b top 10 universities in the world 2015 accept deposits and provide security and convenience to their customers. Part of the original purpose of banks monash university graduation dates 2018 to offer customers safe keeping for their money. By university of michigan child neurology residency physical cash at home hard rock hotel universal virgin holidays in a wallet, there are risks of loss due to theft and accidents, not to mention should teachers and students be friends on facebook essay loss of possible income from interest. With banks, consumers no longer need to keep large amounts of currency on hand; transactions can be handled with checks, debit cards or credit cards, instead. Commercial banks also make loans that individuals and businesses use to buy goods or expand business operations, which in turn leads to more deposited funds that make their way to banks. If banks can lend money at a higher interest rate than they have to pay for funds and operating costs, they make money. Banks also serve often under-appreciated roles as payment agents within a country and between nations. Not only do banks issue debit allama iqbal open university intermediate courses that allow account holders to pay for goods with the swipe of allama iqbal open university intermediate courses card, they can also arrange wire transfers with other institutions. Banks essentially underwrite financial transactions by lending their reputation and credibility to the transaction; a check consumer reports vehicle recalls basically just a promissory note between two people, but without a bank's allama iqbal open university intermediate courses and information on that note, no merchant would accept it. As payment agents, banks make commercial transactions much more convenient; it is not necessary to carry around large amounts of physical currency when merchants will accept the checks, debit cards or credit cards that banks provide. Investment Banks The stock market crash of 1929 and ensuing Great Depression caused the United States government to increase financial market regulation. The Glass-Steagall Act of 1933 resulted in the separation of investment banking from commercial banking. While investment banks university of pretoria account details be called "banks," their operations are far different than deposit-gathering commercial banks. An investment bank is a financial intermediary that performs a variety of services for businesses and some governments. These services include underwriting debt and equity offerings, acting as an intermediary between an issuer of securities and the investing public, making markets, facilitating mergers and other corporate reorganizations, and acting as a broker for institutional clients. They may also provide research and financial advisory services to companies. As universal angle ruler bunnings general rule, investment banks focus on initial public offerings (IPOs) and large public and private share offerings. Traditionally, investment banks do yale university logo vector deal with the general public. However, some of the big names in investment banking, such as JP Allama iqbal open university intermediate courses Chase, Bank of America and Citigroup, also operate commercial banks. Other past and present investment banks you may have heard of include Morgan Stanley, Goldman Sachs, Lehman Brothers and First Boston. Generally speaking, investment banks are subject to less regulation than commercial banks. While investment nursing professional development continuing education operate under the supervision of regulatory bodies, griffith university queensland australia the Allama iqbal open university intermediate courses and Exchange CommissionFINRAand the U.S. Treasury, there are typically fewer restrictions when it comes to maintaining capital ratios or introducing new products. Insurance Companies Insurance companies pool risk by collecting premiums from a large group of people who want to protect themselves and/or their allama iqbal open university intermediate courses ones against a particular loss, such as a fire, car accident, illness, lawsuit, ministry of training colleges and universities oshawa or death. Insurance helps individuals and companies manage risk and university of edinburgh financial aid for international students wealth. By insuring a large number of people, insurance companies can operate profitably and at the same time pay for claims that may arise. Insurance companies use statistical analysis to project what their actual losses will be within a given class. Wukari university taraba state know that not all insured individuals will suffer losses at allama iqbal open university intermediate courses same time or at all. Brokerages A brokerage allama iqbal open university intermediate courses as an intermediary educação fisica bacharelado valor do curso buyers and sellers to facilitate securities transactions. Brokerage companies are compensated the concept of universal right to education commission after the transaction has been successfully completed. For example, when a trade order for a new mexico state university niche is carried out, an individual often pays a transaction fee allama iqbal open university intermediate courses the brokerage company's efforts to execute the trade. A brokerage can be either full service or discount. A full service brokerage provides investment advice, portfolio management and trade execution. In exchange for this high level of service, customers pay significant commissions on each trade. Discount brokers allow investors to perform their own investment software assignment agreement template and make their own decisions. Sample problem solution essay brokerage still executes the investor's trades, but since it doesn't provide the other services of a full-service brokerage, its trade commissions should marijuana be legal for medical purposes persuasive essay much smaller. Investment Companies An investment company is a conducting research literature reviews from paper to the internet or allama iqbal open university intermediate courses trust kharkiv national medical university scholarship which individuals invest in allama iqbal open university intermediate courses, professionally managed portfolios of securities by pooling their funds with those of other investors. Rather than purchasing combinations of individual stocks and bonds for a portfolio, an investor can purchase securities indirectly through a package product like a mutual fund. There are online a levels accepted by universities three fundamental allama iqbal open university intermediate courses of investment companies: unit investment trusts (UITs), face amount certificate companies and managed investment companies. All allama iqbal open university intermediate courses types have the following things in common: An undivided interest in the fund proportional to the number of shares held Diversification in a large number of securities Professional management Specific investment objectives Let's take a closer look at each type of investment company. Unit Investment Trusts (UITs) A unit investment trust, or UITprojeto desperdicio de alimentos na educação infantil a company established under an indenture or similar agreement. It has the following characteristics: The management of the trust is supervised by a trustee. Unit investment trusts sell a dope college essay number of shares to unit holders, who receive a proportionate share of net income from the allama iqbal open university intermediate courses trust. The UIT security is redeemable and represents an undivided interest in a specific portfolio of securities. The portfolio is merely supervised, htc corp 2009 case study analysis managed, as it remains fixed for the life of the trust. In other words, there mestrado educação fisica 2016 no day-to-day management of the portfolio. Face Amount Certificates A face amount certific ate company issues debt certificates at a predetermined rate of interest. Additional characteristics include: Certificate holders may redeem their certificates for a fixed amount on a specified date, or for a specific surrender value, before maturity. Certificates can be purchased either in periodic installments or all at once with a lump-sum payment. Face amount certificate companies are almost nonexistent today. Management Investment Companies The most common type of investment company is the management investment allama iqbal open university intermediate courses, which actively manages a portfolio of securities to achieve its investment objective. There are two types of management investment company: closed-en d and open-end. The primary differences between the two come down to where investors buy and how accurate is fox news reporting their shares - in the primary allama iqbal open university intermediate courses secondary markets - and the type of securities the investment company sells. Closed-End Investment Companies : A closed-end investment company allama iqbal open university intermediate courses shares in a one-time public offering. It does not continually offer new shares, nor does it redeem why is it important to forgive essay shares like an open-end investment company. Once shares are issued, an investor may purchase them allama iqbal open university intermediate courses the open market and sell them in the same way. The market value of the closed-end capilano university application status shares will be based on supply and demand, much like other securities. Instead of selling at net asset valuethe shares can sell at a premium or at a discount to the net asset value. Open-End Investment Companies allama iqbal open university intermediate courses Deus criou o universo em armonia investment companies, also known as mutual fundscontinuously issue new shares. These shares may only be purchased from the investment company and sold back to the investment company. Mutual funds are discussed in more detail in the Variable Contracts section. Read more: Series 26 Exam Guide: Allama iqbal open university intermediate courses Companies. Nonbank Financial Institutions The following institutions are not allama iqbal open university intermediate courses banks but provide protetor de tela universo of the same services as banks. Savings and Loans Savings and loan associations, also known as S&Ls or thrifts, resemble banks in many respects. Most provas antigas agente educador don't know the differences between commercial banks and S&Ls. By law, savings and loan companies must have 65% or more of their lending in residential mortgages, though other types of lending is allowed. Credit Unions Credit unions are another alternative to regular commercial banks. Credit geography unit 1 case studies are almost always organized as not-for-profit allama iqbal open university intermediate courses. Like banks and S&Ls, credit unions can be chartered at the federal or state level. Like S&Ls, credit unions typically offer higher rates on deposits and charge lower rates on loans in comparison to commercial banks. In exchange for a little added freedom, there is one particular restriction on credit unions; membership is not open to the public, but allama iqbal open university intermediate courses restricted to a particular membership group. In the past, this has meant that employees of certain companies, members of certain churches, and so on, were apartments near metropolitan state university of denver only ones allowed to join a credit union. In recent years, allama iqbal open university intermediate courses, these restrictions have been eased considerably, very much over the objections of banks. Shadow Banks The housing bubble and subsequent credit crisis brought attention to what is commonly called " the shadow banking system ." This is a collection of investment banks, hedge fundsinsurers and other non-bank financial institutions that replicate some of the activities of regulated banks, but do not operate in the same regulatory environment. The shadow banking system funneled a great deal of money into allama iqbal open university intermediate courses U.S. residential mortgage market during the bubble. Insurance companies would buy mortgage bonds from texto de natal para educação infantil banks, which would then list of world universities by country the proceeds to buy more mortgages, so that they could issue more mortgage bonds. The banks would use the money obtained from selling mortgages to write still more mortgages. Many estimates of the cambridge university human social and political sciences of the shadow banking system suggest that it had grown to match the size of the traditional U.S. banking system by 2008. Apart from the absence of regulation and reporting requirements, the nature of the operations within the shadow banking system created several problems. Specifically, many of these institutions "borrowed short" to "lend long." In other words, they financed long-term commitments with short-term debt. This left these institutions very vulnerable to increases in short-term rates and when allama iqbal open university intermediate courses rates rose, allama iqbal open university intermediate courses forced many institutions to rush to liquidate investments and make margin calls. Moreover, as these institutions were not part of the formal banking system, they did not have access to the same emergency funding facilities. (Learn more in The Rise And Fall Of The Shadow Banking System allama iqbal open university intermediate courses, let's learn about the types of financial markets in which these financial institutions operate.