Capital transfer primarily occur through

Capital transfer primarily occur through

Direct conveyance in the closeout of bonds and stocks

Transactions via budgetary intermediaries

For instance, direct conveyance involves selling business-based stocks and bonds to investors who have a consistent cash flow and are ready to invest.

1. b) A market defines as a platform that allows interaction between customers and retailers at the expense of purchasing and selling goods and services. While physical assets markets focus on exchanging goods and services within a set vicinity, financial asset markets involve business between financial securities, as for our case, bonds, and shares. While the future market denotes contractual agreements for future business, the Sport market engages trading based on intermediaries for vital financial assets. On the same note, the money market represents institutions’ move to short-duration assets, while capital markets encompass long-duration loans and investments to the general public.

Auxiliary markets involve market situations where companies offer invitations to the public to purchase shares and bonds. Whereas in the primary market is where the assets and bonds remain created for the initial phase. Conversely, public markets offer the bonds and shares to the general public, whereas in private markets, the business of bonds and shares occurs among initially established investors.

1. c) Existence of financial markets directly translates economic developments by giving a sense of direction to the investments and savings in an economic framework. Besides, a perfect interchange of financial markets in line with institutional business guarantees secure availability of lending and borrowing hence a total boost to the economy

1. d) Derivatives involve contractual agreements focused on providing a platform for trade, investments, and institutions to relocate possible risks and profits within a bossiness framework to different associative crews. Through the engagement of derivatives, personnel and cooperation remain guaranteed reduced chances in terms of losses in the presence of market fluctuations. The results increase the investors’ potential gain or individual affiliations in a highly and effectively performing market.

Commercial banks are initial banks that, at one moment, served as the central banks in a particular nation. The banks perform as the vital transactional agencies offering loaning services of assets, bonds, and shares. These banks in the modern world are sources of stoke broking and insurance services.

Investment banking institutions provide a platform for individual organizations to develop their investments through increased lending of bonds and financial securities for economic stimulation.

Mutual funds engage financial assets lenders by acting as derivatives and mediators to assist in risk reduction by creating different diversities. These systems typically concentrate on small scale investments.

Pension funds represent investments by the working class, aiming to pay these investors at their later stages after leaving work.

In exchange, traded funds provide a platform for financial commodities transactions, including bonds, stocks, and merchandise, similar to the stock exchange. The engagement, however, provides for lower risk ratios as compared to stores.

1. d) The top two best stock exchange platforms globally include the New York and NASDAQ stock exchange markets. While the New York Stock Exchange bases on physical sports transactions engaging institutions with evident physical locations conducting business on bonds and shares, NASDAQ deals on informal transactions of electrical devices and services.

1. e) By purchasing shares from Willox financial platform, Mr. Jones will be doing his transactions in the primary market. If Mr. Jones decides to procure initially outstanding stocks from google, the transactions become secondary market status.

1. f) Initial Public Offerings involves a private and established institution’s procedure in offering financial securities of stocks to a given public for an initial phase. It is essential as an investor to grasp this platform’s knowledge since it will aid in developing your inherent business. This platform offers access to the national capital markets and guarantees direct exposure to the business

1. g) Markets efficiency represents directly in cooperation of all market elements, rendering the availability of all information on the markets. In this market situation, markets remain unbeatable due to the efficient valuation of shares and bonds. Due to the kinds of claims they offer, some stocks may attract less efficient prices than others since they may be offering shares in dominated markets instead of those offered in as preferred shares.

Question 2

1. In this case, Mr. Jones should buy stocks from this company since it is newly initiated in the market and not yet developed. The company’s growth, which has just received its approval from the FDA, remains unguaranteed since it may experience losses in the future.

1. Jones Should, at this stage, consider purchasing the company stocks in the advent of the company raising its IPO as this would increase its status to a premium state owing to oversubscription that guarantees relatively higher returns. This status will be a clear directive since when institutions raise their capital hence rendering them premium, many investors will come on board, increasing the company profits.

1. The efficient market hypothesis outlines that stock investors’ normal behavior is to purchase stocks with the inherent increase in stock prices, assuming that the market will rise, more significantly greater profit margins. In these circumstances, the behavioral finance theory depicts investors’ actual behaviors in the case of investments.