BAFI1002 Lecture Notes - Lecture 1: Investment Fund, Financial Instrument, Aggregate Demand
Document Summary
Range of financial institutions, instruments, markets that facilitate transactions for goods and services and financial transactions. Key elements: financial instrument, markets and institutions. Facilitate the transfer of funds from surplus economic units to deficit economic units, by creation of new financial assets. Facilitate the trade of existing financial assets. Individuals, households and companies with more funds than required for immediate expenditure. Individuals, households, companies who require additional funds to meet expenditure plans. Entitle the holder to specified future cash flows. Represents an obligation on the part of the borrower to repay principal and interest. Eg: deposits and loans, contractual savings, discount securities, fixed interest securities. Represent an ownership claim over the profits and assets of a business. Financial assets which have features of both debt and equity. Financial assets whose value is derived from another financial asset, rate or index. Return the gain or loss of an investment over a specified period.
