RSM100Y1 Chapter Notes - Chapter 16: United States Treasury Security, Commercial Paper, Corporate Bond
Document Summary
The amount that individuals save is normally influenced by age. Funds are transferred between savers and users both directly and indirectly (through banks) Securities: financial instruments that represent the obligations of the issuers to provide the purchasers with the expected stated returns on the funds invested or loaned. > money market instruments: short-term debt securities issued by governments, financial institutions, and corporations (ex. Canadian treasury bills, commercial paper, bank certificates of deposit) > issuer pays interest to the investors for the use of their funds. > money market instruments = low-risk securities and purchased by investors when they have surplus cash. Canada savings bonds: mature in 10 years, but can be cashed at any time. Affordable: can be purchased for as little as . General obligation: issued by provincial or local governmental units with taxing authority. Secured bonds: bonds that are backed by specific assets. Risk varies depending on the financial health of the issuer; generally very low.
