Class Notes (809,497)
Canada (493,753)
York University (33,568)
ADMS 3900 (9)
Lois King (9)


3 Pages
Unlock Document

York University
Administrative Studies
ADMS 3900
Lois King

AIN DIFFERENCES between the types of firms is: 1 Amount of information received Extra cost to investors negotiable 3 Extra service 4 Personal contact Full service brokers • Commission (negotiable) • No on-line trading • Many owned by banks Sources of revenue for Full Service Brokers Trading for the brokers account Underwriting new securities Administrative fees Commission from transactions Sale of in house mutual funds (Can be conflict of interest) Discount Brokers • BMO investor line, TD Waterhouse • Reduced brokerage fees • Offering same services as full brokerage expects for research reports.... recommendations and advice • discount broker offer online trading Online Trading • Lowest commission rate. • Trading done through internet such as E*Trade, Qtrade.Investor • see pages 128 to 130 for comparisons of on-line brokers & Discount Brokers • in profits of online brokerage fee. Types of Accounts—for settlement of transactions 1. Cash account (open a cash account to purchase investments) Pay for full amount of security • similar to opening a bank account 2. Wrap Account (Managed Account) • Wealthier investors • Investors uses a money manager as consultant • All costs are wrapped into one fee (% of Assets) Advantages of Margin • greater diversification - can spread capital over more investments • Leveraging • Long-term purchase plan: hold for capital gains • Magnifies gains Disadvantages of Margin • it magnifies loss, cost of margin loans • When price drops, margin may also drop (70% to 50%). • margin call (limited time) • Broker can sell investor’s holdings to replace equity Short Selling (Sell first buy second) (vs. Long (Traditional) buy first sell second 1) Used when investor expects price to drop. Profit =drop in price 2) Must be approv
More Less

Related notes for ADMS 3900

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.