Economics Money And Banking

Running head : Characteristics of Financial InstrumentsNameUniversityLecturerCourse CodeMatrix of the Characteristics of Financial InstrumentsFinancial instruments be prance arrangements that have been classified into various types depending on their attributed characteristics and structure and atomic number 18 easily tradable in pecuniary foodstuffs . They atomic number 18 advantageous in that they allow efficient flow of capital without carrying along the veridical amount of cash in the financial markets . These financial instruments back up include the Demand Deposits which are amounts dumbfounded by a head teacher in a bank on legal cop to withdraw upon demand without requiring any notice to be supposal in advance , Corpopace Bonds which are monies borrowed by larger corporations which are not governing bod y action owned (there is an agreement adjoin by the borrower and the corporations that the money must be repaid upon the expiration of the adulthood issue . Also there is Treasury Bills which are debt instruments that mount up inside one year and are issued by the government , national Funds which are funds that commercial banks deposit with the primordial bank (Federal Reserve ) which are used for mundane operations of the banks , commercialised s and abbreviated as (CP ) are unfastened short term debts issued by companies to meet short-run financial obligations . Municipal Bonds are long-term debts issued by the topical anaesthetic government , Lotto Tickets which are drawn lot deem aims which are a form of gambling , Commercial Loans which are bestows mature by banks to individuals or corporations for business purposes and there is computer memory which is be as the portion of the shareholding in a company that is , the claim that an investor has on company s assets ( HYPERLINK http /www .investorwords! .com www .investorwords .

comThe spare-time activity is the matrix of the characteristics of financial instrumentsName Borrower Lender Yield Maturity RepricingInterval jeopardize LiquidityDemandDepositsbanks Individuals and corporations Closed- worry roams No fixed maturity determine cashbox run Cash reserveCorporateBondsLarge corporations Financial companies , banks and industrial trustys fixed interest rate over one yearCorporate village cashTreasuryBillsCommercial banks Individuals and menial firms clip interest rate 360 daysNo liquidity benefit cashCommercialp notes market mutual funds and commercial banks Financial companies banks and industrial firms Fixed interest rate 5-45 daysDefault risk Cash reserves or bank creditsFederalFundsGovernment Commercial banks and savings and loans firms Fixed voucher rate One dayRisk premiums cashStocksCorporations Individual investors and corporations Dividends Depends on whether it is redeemable or irredeemableFirm liquidation or decline in value of the firm Assets or cashMunicipalBondsLocal government Commercial banks and individuals Fixed coupon rate Over one yearNo tax exemptions .Assets or cashCommercialLoansBusiness firms and individual investors Commercial banks concern rates Agreed time periodFixed purpose of the loan corroboratory or cashLottoTicketsLottery clubs individuals Gains Annuity over 20 years or upon winningBogus lottery clubs and taxation Fixed cash or goodsThe quest is a complete a yield trim display yields of Treasury securities for some day...If you want to get a broad essay, order it on our website: OrderEssay.net

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