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Investment Banking
An investment bank refers to a financial institution which helps corporations, individuals, and governments in securing capital by acting as the agent during the issuance of securities. Unlike other banks, investment banks do not accept deposits.
744 Questions
What is Oversight Function in political terms?
it is an action taken by the government. Answer: Our elected officials are charged to oversee how our money is spent, how the government is run, etc. An example of the failure of an elected official to live up to this responsibility:
In the May 23, 2006 BusinessWeek, in an article, "Intelligence Czar Can Waive SEC Rules," it was revealed that on May 5, 2006, President George W. Bush gave his presidential powers to intelligence czar John Negroponte, in order to excuse publicly traded companies from their usual accounting and securities-disclosure obligations. BusinessWeek states, "Administration officials told BusinessWeek that they believe this is the first time a President has ever delegated the authority to someone outside the Oval Office." The article states, "Unbeknownst to almost all of Washington and the financial world, Bush and every other President since Jimmy Carter have had the authority to exempt companies working on certain top-secret defense projects from portions of the 1934 Securities Exchange Act…A trip to the statute books showed that the amended version of the 1934 act states that 'with respect to matters concerning the national security of the United States,' the President or the head of an Executive Branch agency may exempt companies from certain critical legal obligations. These obligations include keeping accurate 'books, records, and accounts' and maintaining 'a system of internal accounting controls sufficient' to ensure the propriety of financial transactions and the preparation of financial statements in compliance with 'generally accepted accounting principles.'" The connection between public companies and the intelligence community is documented in a Jan. 4, 1987 New York Times "'The Company' as Big Business" by Clyde H. Farnsworth Secrecy, and the manner in which the derivatives market developed and remainsunexplained to the American people, brings to mind these words from A Torchlight For America by Minister Louis Farrakhan regarding America's condition, "The root of her suffering is basic immorality and vanity, where greed, lust and inordinate self-interest has become the way of life. When the desire for the realization of self-interest becomes excessive, the first casualty in this struggle is 'truth.' The leaders in the society, in their struggle to achieve inordinate self-interests, engage in hiding the light of truth from the American people. Without truth the American people are left paralyzed, unable to constructively address their problems."
Congress also has a Constitutional mandate to oversee money issues. They have abdicated this responsiblity in the creation of the Federal Reserve and in overseeing the spending of the bailout money. This country can not recover economically unles Congress starts to pay attention to the Constitution. Look up the views of Texas Rep. Ron Paul and see related questions. Quote from http://www.finalcall.com/artman/publish/article_5361.shtml
What are complementary investments?
Complementary investments are investments which raise any potential profits from the use of a new technology.
An increase of any investment A leads to an increase in productivity of investment B.
Take the Hoover dam as an example, not only was the dam built for technical/environmental reasons ( investments A ), when completed it was a large tourist attraction which people wanted to come visit ( investment B)
What are the advantages disadvantages of investing in gold?
The primary advantage of owning gold is that there is no counter party risk to the value of your investment. Gold has been a store of value since ancient times and this is not likely to change. By contrast, an investor in bonds or stocks could lose their entire investment if a company goes bankrupt. Despite the fact that gold can fluctuate in value, it is almost impossible to imagine a scenario when gold would have no value. The disadvantages of gold is that it is a sterile investment in terms of producing income. An investor holding physical gold will only see a gain in value if the price of gold increases. Many investors who purchase gold believe that it is a safe alternative to paper currency backed investments since over time many currencies have failed or the value of the currency has declined dramatically due to inflation. For a more detailed explanation, please see my article on "How To Invest In Gold" (http://investing.answers.com/types-of-investments/how-to-invest-in-gold).
The basic determinants of investment are the expected rate of return (net profit) that businesses hope to realize from investment spending, and the real rate of interest.
When the real interest rate rises, investment decreases; and when the real interest rate drops, investment increases—other things equal in both cases. The reason for this relationship is that it makes sense to borrow money at, say, 10 percent, if the expected rate of net profit is higher than 10 percent, for then one makes a profit on the borrowed money. But if the expected rate of net profit is less than 10 percent, borrowing the money would be expected to result in a negative rate of return on the borrowed money. Even if the firm has money of its own to invest, the principle still holds: The firm would not be maximizing profit if it used its own money to carry out an investment returning, say, 9 percent when it could lend the money at an interest rate of 10 percent.
Investment is unstable because, unlike most consumption, it can be put off. In good times, with demand strong and rising, businesses will bring in more machines and replace old ones. In times of economic downturn, no new machines will be ordered. A firm can continue for years with, say, a tenth of the investment it was carrying out in the boom. Very few families could cut their consumption so drastically.
New business ideas and the innovations that spring from them do not come at a constant rate. This is another reason for the irregularity of investment. Profits and the expectations of profits also vary. Since profits, in the absence of easy access to borrowed money, are essential for investment and since, moreover, the object of investment is to make a profit, investment, too, must vary.
As long as expected rates of return rise faster than real interest rates, investment spending may increase. This is most likely to occur during periods of economic expansion.
What are the disadvantages of the discounted payback period?
It's not a direct measure of a project's contribution to stockholder's wealth. You may reject project's that should be accepted when using the NPV analysis (best method used for determining whether or not a project is accepted in Capital Budgeting). Discounted Payback Period AdvantagesConsiders the time value of money Considers the riskiness of the project's cash flows (through the cost of capital) Disadvantages No concrete decision criteria that indicate whether the investment increases the firm's value Requires an estimate of the cost of capital in order to calculate the payback Ignores cash flows beyond the discounted payback period
Younes Aitouazdi: University of Houston Downtown
A Treasury Bill (known as T-Bill) is an instrument of money market, used to finance short term requirements of Government of a country. A T-Bill is issued at a rate lower than the Face value, and redeemed at Face value on maturity which is less than one year, this difference is the rate of interest on T-Bill. This rate of interest is called Risk free Rate of the country. Investment in T-Bills as a risk free investment.
What are the advantages and the disadvantages of investing?
Adv:
1. You can save money for your future
2. Your money grows at a good rate when compared to the inflation rate
There are a lot of advantages of investing. The above mentioned two are the main reasons.
Disadv:
1. You may lose money if you choose high risk investment options. Apart from this there are no disadvantages of investment.
What does a pooled issue mean?
A pooled issue, in relation to securitisation, is where a number of different entities will raise capital through a single vehicle which then on-lends to the respective entities. The entities will "pool" their assets together as security for the bond allowing smaller funding requirements to be met through the capital markets where a minimum issue size would be in excess of £40-50m.
Benefits:
Access to Capital Markets: Individual entities can raise smaller amounts allowing access to the Capital Markets
Access to long term funding: reducing refinance risk (whereas traditional bank lenders currently will only lend short term 5-10yrs max)
Shared costs: legal, trustee and other associated costs split.
Credit Rating: Combined credit can improve the credit rating thus tightening pricing.
Where is smart money investing now?
By way of analogy, you could ask... how do "Fitness Experts" exercise? Or how do "Health Conscious" people eat? Answer= regular balanced exercise, or regular balanced meals.
Smart investors invest regularly (Monthly) into conservative broad based investments , an example would be into very low cost index trackers
Smart investors don't buy heavily into any one sector or company, any more than smart exercisers exercise only biceps (For example).
If an investor wants to buy heavily into (lets say) gold, then go for it. But don't call it investing. Call it by the proper term... Gambling. Who knows, you might get lucky. Don't most gamblers?
Cheers
Internal promotion exam of sbi employee?
3 yrs experience for clerk to be promoted as asst manager when passed internal exams of sbi
What are the historical development of pragmatism?
Pragmatism arose as the most sophisticated attempt to http://www.answers.com/topic/reconcile science and religion in the wake of the widespread acceptance of Darwinian biology
Absolutely legal. And from what your saying, nothing even remotely fishy or unsavory.
Many charitable actions take years to collect funding before they come to fruition.
Some charities may have to pay a tax, albeit a small one, on earnings from unrelated business income...although it even depends on which method that charity qualifies for it's tax exemption under.
Should you use standard deviation or variance when measuing a stocks monthly returns?
Only if your Interested in using Technical Analysis. Otherwise it may not have any effect if the Market is in Volatile movement which is known as weak form efficiency
The question cannot be answered. 1.094171 monthly is not equivalent to 2.25 APR. So the question contains inconsistent information.
What are the methods of evaluating international investment decisions?
If you're doing homework, you're probably better off just finding a book or searching an internet database then searching for an answer here.
A security deposit is an advanced deposit that is generally retained by the landlord during your tenancy. The landlord is obligated to return such deposit within 30 days with interest earned, if any, and/or an itemized list of expenses for which the landlord is offsetting the deposit amount (for which he wants to keep some or all of the deposit). The laws regulating such deposit varies between states under the Landlord/Tenant laws of that state.
The probability that a statistical that will give give a false negative error.
What is the acceleration principle regarding investments?
The accelerator principle is a concept used to describe the positive economic impact of an increase in capital expenditures by businesses. As funds are spent to build plant and equipment there is a concurrent increase in the need for labor and material which results in increased employment and increased income. The increase in income results in more demand for goods and services as the money is spent which can in turn lead to further expansion of plant and equipment by businesses thus creating a virtuous self perpetuating cycle of economic growth.
How do you calculate payback period using bail-out method?
Initial Net Investment / (Annual expected cash flow + salvage value)
Discuss some of the manifestations of the globalization of world capital markets?
The globalization of world capital markets provides nations, along with a number of businesses, including banking, central banking, & investment banking with a large degree of liquidity. This liquidity encourages world wide investments as major global players have confidence that there will be an active market for buying and selling.
The linkage provided by this globalization, however, can be problematic in a severe crisis. When liquidity shrinks, and credit tightens, this can cause global disruptions in the in bond and equity markets.
In the past where some nations had closed economies or set their currency's value by fiat, the benefits along with the hazards were not felt entirely on a global basis. The penalty for this was the inability of those particular nations to entertain growth from capital from abroad.
What is an investment banker and what major function does he or she perform?
Investment bankers manage stock portfolios and investments for their clients, and help them make management decisions to make the most of their money.
