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equity 1 - Coggle Diagram
equity 1
market organization
and structure (R36）
well function financial market
每个参与者都有机会从
市场得到自己想要的东西a
saver
borrower
hedger
trader
operational efficiency
low transaction cost
informational efficiency
asset prices reflect new info quickly
allocational efficiency
flow to highest value uses
objectives of regulation
control fraud and theft
prevent insider trading
reduce costly info
ensure that long term liabilities are funded- default risk
promote fairness
intermediaries of financial markets
broker
agents fill orders for their clients
earn commision
手上无存货
dealer
fill orders for clients by trading with them
give market liquidity
earn bid-ask price
手上有存货
exchange
集中订单
撮合成交
securitizer
depository institution
受国家保护
arbitrageurs
clearinghouse
custodian
investment bank
insurance company
classification of market
money vs capital market
money market
short term debt instruent <1yr
capital market
securities of longer duration
ex. bond and stock
primary vs secondary market
primary market
IPO
secondary issue
offering in primary market
public offering
underwritten offering
best effort
indicators of interest
book building
book builder
other offering
private placement
shelf registration
dividend reinvestment
rights offering
secondary
market
better liquidity
trading helps market to identify proper price
classification of secondary market
order driven market
follow 2 rules
price priority
time precedence
quote driven market
OTC
dealer dominated market
examples: bond, forex, spot commodities
brokered market
broker dominated market
trade assets
infrequently traded
expensive to carry
examples: real estate, fine art, large block of stock
call market
continuous market
traditional vs alternative market
traditional market
bond
stock
alternative market
hedge fund
commodity
real estate
long & short position
long position
short position
short rebate rate
payment in lieu
short seller pay to lender
leverage position
margin
formula
leverage ratio
price return * 倍数
initial margin requirement (IM)
maintenance margin requirement (MM)
margin call
leverage return
margin cal price
execution instruction
market order
limit order
make the market
make the new market
take the market
behind the market
far from the market
all or nothing order
hidden order
iceberg order
validation instruction
day order
good to cancelled order (GTC)
immediate or cancel order
good on close order
good on open order
stop sell order
stop buy order
momentum trade
security market index (R37)
characteristics of equity index
broad market index
multi-market index
multi-market index with fundamental weighting
sector index
style index
index return
price index
total return index
when they will equal?
at inception, div=0
stock does not have any dividend
rebalancing & reconstitution
rebalancing
adjusting the weights of consituent securities
reconstitution
changing the constituent securities
turnover
different weighting method
price weighted index
高股价influence the entire index greatly
stock split
influence denominator
equal weighted index
frequently need rebalance
not affected by 高价股
affect by 小盘股
market capitalization-weighted index
momentum effect
过多关注大盘股
剔除小盘股影响
float-weighted market capitalization weighted index
fundamental weighted index
P/E
contrarian style
dividend
value-tilted
other market index
fixed income index
commodity index
real estate index
appraisal index
repeat sales index
REIT index
hedge fund indeex
survivorship bias
blackfill bias