FIN 3120 Lecture Notes - Lecture 2: Financial Intermediary, Investment Banking, Underwriting
Document Summary
Markets help transfer capital from people who have extra money to people who need money. This could happen by directly giving money to businesses. Could sell securities or % of the company to an investment banking firm. The business sells securities to a financial intermediary (financial fund) Businesses making a deal with wealthy investors. A prime source of funding for companies that are looking to change. Funding these ventures is risky but carries the potential for high returns. Investment bankers act as the agent that helps you sell your house. Mutual funds allow savers to exchange specific stocks or money for shares of an investment fund. Public stockholders simply invest in the securities of a company, there is. Direct placement is offered to a limited number of investors, receives more very little control that a public stockholder has. control over the company. Primary market -- the public gets access to purchasing securities directly from the company.
