Wednesday, January 25, 2017

Investment banking, equities, trading.

Knowledge of Investment banking, equities, trading.

Good knowledge of investment banking, equities and Trading.
https://www.youtube.com/watch?v=xlYDonZLoHg

1. Retail bnaking - Morgages, loan, saving account ( 1 time investement will be get from customers)

2. Investment Banking - Jp Mordan, Goldman sach  ( Which has high risk )

What do Investement Banks Actually do? ( Risk activities)
  1. Prop Trading - they will do gambling the banks money to make profit.
  2. Market Making - Retail investor or investment bank will trade in the Stock exchange( Subjected to rules)
  3. M&A Advisory - Mergers & accocation - In airlies one company buy other company. ( When to buy)
  4. Corporate Events / New issues - To raise more capital ( When to raise the issue? \ How to sell? \ Underwriting will collect a fee \  XXX Million amount to raise)
  5. Structured Products - we need a procuts to sell in market - ie.  Leand a money for 2 years, get back with 18% interest )
                           Will have time and money involved.

https://www.youtube.com/watch?v=wTQMYg0LLFQ
* What is equity? - Are risky shares - Every financial year we will get dividen.
It's what a company is "worth"
It can also refer to the "Value" of your equity stake in a business

Preference Shares  - Assured returns as a divident based on the finical position.

* Trading Basics
https://www.youtube.com/watch?v=0O8uM9WE_RM
Individual markets are composed of various financial instruments
Bonds stocks currencies and commodities
Stocks - Prices move up and down according to supply and demand; more buy -up price \ more sell - down price
         Brokers helps to trade, we can do online as well.
different type of order -
Market order - offer price (place order) - as of now $550 - Buying for $540/- ( will get profit if we buy else minimum loss
limit order - Stop order - fixed price.

* Understanding Long and Short Terms in Stock Market Trading
https://www.youtube.com/watch?v=O__aZ4jxrJ8
Long - You are positive to go up in the market
Short - You are Negative to go Down in the market

I have nike In hand -> + 1000 - 500 Sold =  I will still have 500 in hand
I sold shares - 1000 and Purchase + 300 = - 700

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* Stocks - Stock market - Where buying and selling of share\equities will happen here.
How The Stock Exchange Works (For Dummies)

* Currencies - Forex - Exchange of currencies - exchange rate Change based of supply and demand
( Mostly in USD )We can do online.
Global Currenciez: What Is Forex? - Foreign Exchange, Currency Trading Market
https://www.youtube.com/watch?v=-KoLWdk5dMs

Commodities - Commodities General Introduction - Real products ( Physical Commodities
https://www.youtube.com/watch?v=wVzi6902qUM&list=PLF089570B189A2BA4
Oil, gold, corn, cattle, life stocks - will be do by the traders

Furutres market  - Future contract
Standard furutre contract - 1000 Barrels of oil
we are just peclating the price of the product.

* FUTURES CONTRACT - a fuctures contract gives you the right to make or take DELIVERY of the physical commoditiy.
A futures contract has an EXPIRATION DATE and a FIRST NOTICE date.
If you still own the contract at the expiration date you will take delivery of commoditiy!

Based on the Seasonal Climate of the world.
Who actually trades the furutes marketfor the underlying commodity?
Crude oil is the best produt to do commodities!
  Eg. Southwest Airlines
      HEDGED(or Locked in) 70$ of thier crude oil requirements at a price of $51 a barrel
using Ftures contracts.

Their competitors who weren't hedged had to pay $120 a barrel!

2007 - Southwest Airlines secuted a significant competitive advantage by using the futures market.
$727 million in cost!.

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