Fin 370 Week 1

Topics: Bond, Investment, Debt Pages: 2 (529 words) Published: June 11, 2012
Studying money and how it’s controlled either by an individual or by a business. Several portions of finance are considered imperative. One key component of finance is the knowledge and understanding of credit and how it works within banking. •Efficient market

This type of market ‘a values of assets and securities are reflected and made available to the public at all times. An efficient market is a market that an investor would want to make investments in. •Primary market

This is the type of market in which an individual is able to buy and maintain stocks and bonds that are new securities. This is the only point in which an issuing firm makes money from their stocks. The money that the individual would use to purchase stocks goes to the stock issuer. This relationship makes the individual a purchaser in a primary market. •Secondary market

Once the stocks are newly issued, they then become subject to the public. This is when trading begins known as the secondary market. •Risk
This is known as the likelihood of a negative outcome that can happen during an investment. When it comes to stocks, risks are usually linked to high levels of instability. •Security
A security in stocks, bonds, or the right that an individual has as ownership within an establishment. Securities can be traded within primary and secondary markets. •Stock
Represents the original investment paid into or capitalized in the corporation by its founders. It can serve as a safety for the creditors of a corporation. •Bond
A bond is a debt security. This is when the individual issuing the bond becomes obligated to the buyer. The issuer must re-pay the bond at a later time including accrued interest. Bonds are usually sold by businesses and governments. •Capital

This can be defined as currency used by various businesses to buy the necessary items needed to run their foremost operating activities. Capital is provided by both investors and banks. Usually,...
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