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Showing posts from April, 2019

Mexican Stock Exchange (Mexican Bolsa)

Plagued by vicious drug cartels and rampant government corruption, the Mexican Stock Exchange (or, as it’s known locally, la Bolsa Mexicana de Valores) is the second-largest South American exchange. Headquartered in Mexico City, it is the only securities exchange in Mexico.

Considered an emerging market, the Mexican economy has been going strong and is predicted to stay on the move upward. Its forward progress continued, though slowed, even during the worldwide recession that characterized the early 2010s. Mexico is among the top ten oil-producing nations in the world, and even with volatile and low crude oil prices, the country has been able to maintain its economic growth.

When it comes to stock market performance, there are two ways to monitor the Mexican market: the MEXBOL IPC Index, which includes a wide range of companies trading on the Mexican stock exchange, and the INMEX index, which tracks the twenty (or so) companies with the largest market capitalization. 

Foreign investors s…


Headquartered in the Netherlands, Euronext is a cross-border exchange, and the first Pan-European securities exchange. Euronext was born in 2000 by merging the Paris, Brussels, and Amsterdam exchanges. Then in 2002, the Portuguese stock exchange was added, followed later by a London securities exchange (but not the London Stock Exchange).

In April 2007, Euronext merged with the NYSE Group to form NYSE Euronext. And by 2008, the combined exchange listed almost 4,000 securities with a total market capitalization of more than $30 trillion.

When Intercontinental Exchange (ICE) bought NYSE Euronext in 2013, the two powerhouses were split once again. Still, Euronext remains one of the largest exchanges in the world. In June 2014, Euronext launched its own IPO, and once again became a standalone entity.

The Euronext exchange system opened up the European stock market, allowing companies to list their securities in multiple markets that fall under a single umbrella. For example, a stock listed o…

Stock Exchange of Hong Kong

The Stock Exchange of Hong Kong was established in 1891. Today, the exchange is primarily driven by the country’s highly respected and sophisticated financial services industry. Hong Kong has an intimate relationship and trading partnership with China; its exports to that country alone top $300 billion annually, which amounts to nearly 60% of Hong Kong’s total exports. The exchange mimics that pattern, with Chinese companies making up more than half of the stocks trading there.

Hong Kong operates as a “special administrative region” created by the central Chinese government to allow the small nation to operate basically the same way it had under the former British rule. For investors, this distinction is crucial, because the Stock Exchange of Hong Kong operates with autonomy in a capitalist country that is governed by a limited democracy (as opposed to China’s communist government and socialist economy).

During the late 1990s, this exchange was able to start listing H-shares of large Ch…

Tokyo Stock Exchange

The Tokyo Stock Exchange was first opened in 1878, trading precious metals and government bonds. Stocks joined the party in the 1920s. Interrupted by World War II, the exchange reopened in May 1949, and by 1989 (right before the big crash) its total market value topped $4 trillion. Now the exchange lists nearly 2,000 firms, including some of the most successful companies in Japan.

You can easily track the TSE by watching the Nikkei 225 Stock Average, usually referred to simply as the Nikkei (pronounced “knee-kay”), a stock index that tracks the ups and downs of the Japanese stock market. It includes 225 blue chip stocks, all headquartered in Japan. The Nikkei is similar to the S&P 500 Index in the United States, which tracks the share price activity of 500 of the largest corporations on the market . 

Another way to gauge the Japanese market is with the TOPIX (Tokyo Stock Price Index). TOPIX, which launched in 1968, covers about 70% of the Tokyo Stock Exchange, tracking primarily lar…

London Stock Exchange

One of the oldest stock exchanges in the world, the London Stock Exchange (LSE) has roots going back to the seventeenth century, when traders met in coffee houses. In 1973 local exchanges were merged to form what was originally called the Stock Exchange of Great Britain and Ireland, later renamed the London Stock Exchange.

For many years, those exchange members made deals on the trading floor in London, until technology took over. Today, trading on the LSE takes place via computers, processing more than a million transactions every day.

The LSE operates in more than one hundred countries, and offers access to both British and overseas securities to investors around the world. It includes around 350 companies from more than 50 countries.

Officially called the Financial Times Actuaries 100 Index, the FTSE (pronounced “footsie”) 100 index is the most widely tracked stock market index in the world. Launched in 1984, the FTSE tracks the 100 largest blue chip companies listed on the London exc…

Role of Retail Banking in Financial Market ?

A commercial bank is a type of bank that provides services such as accepting deposits, making business loans, and offering basic investment products.
Commercial bank can also refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses, as opposed to individual members of the public (retail banking).
In the US the term commercial bank was often used to distinguish it from an investment bank due to differences in bank regulation.  After the great depression, through the Glass-Steagall Act ,  the U.S. Congress required that commercial banks only engage in banking activities, whereas investment banks were limited to capital markets activities.  This separation was mostly repealed  in the 1990s.
A financial institution that provides services, such as accepting deposits, giving business loans and auto loans, mortgage lending, and basic investment products like savings a…

Role of Investment Banking in Financial Market ?

What does an invesment bank do ?Raise capital for clientsAdvise corporations, states or entities on capital structure, strategy, business combinations.Create and sell securities to institutional and retail clients.Manage money for institutional and retail clients.Trade on proprietary basis.
Importance of investment bankingHelps the corporations in raising capital. It facilitates the trading in securities thereby increasing the liquidity of the securities.It provides investment opportunities to the individual or entities.Most of the corporations get advisory services from the investment bank regarding the mergers, acquisitions and divestiture.

Structure of investment bankingInvestment banks are organized into 3 categories.

Front office

Helping customers raise funds in the capital market and advise on mergers and acquisitions.professional management of various securities and other assets.Buying and selling financial products with a goal of making money on each trade.Creating and marketing f…

Future And Options Derivative Trading For Beginners

Introduction to Derivative Market

Derivative MarketDerivatives are tradable products whose price is based upon another market.Derivatives are security, whose value based upon other more basic underlying variables.
Mejor Types of Derivatives Contracts
1.    Forward Contracts

A forward contract is a simple derivative security.  It is an agreement to buy or sell an asset at a certain time for a certain price.

2.    Futures Contracts

A future contract is like a forward contract.  It is an agreement betweentwo parties to buy or sell an asset at a certain time in the future for a certain price.

3.    Options contract

An opinion contract is an agreement between a buyer and seller that gives the purchaser of the option the right to buy or sell a particular asset at a later date at an agree upon price.

Futures and Forwards:
Futures are contracts for agreement to purchase or sell set of assetsat allocated time in the future for a certain amount. Forwards are a type of future which is not standardized and…

Why Trade in Commodity Market ?

Why Commodities?
*   Commodities are easy to understand and have positive correlation with inflation.

*   The Commodity market are global in nature, hence less risk for manipulation.

*   Every commodity have seperate market in itself and hence many such market is simulated at one single screen.  The trend in one commodity not necessarily have correlation with the trend of other.

*   Historically Commodities have outperformed the Stock Market.

*   Diversification through a different asset class.

*   Low Margins - 4%  -  10% only

Why Commodity Trading?
Let s say you want to buy gold because you believe that the price of gold will rise.

what will you do?
You will probably buy gold bars, store them, wait for the price to go up and then sell them. Problems:  You have to be sure whether the Gold is  pure or not, you will need a safe place to store it thus  require security and other hassles.

Solution:  Just buy Gold Futures from the Commodities Exchange

Trading in Commodities Market
∆  Clients registere…

How to trade effectively in Bonds ?

What is Bond ?
* Meaning :  Type of debt or long-term promissory note, issued by a borrower, promising to its holder a predetermined and fixed amount of interest per year and repayment of principal at maturity.

Issuers or Borrowers :  Corporations, US Government, State and Local Municipalities. Bond ladder strategy : building a bond ladder means buying bonds scheduled to come due at several different dates in the future, rather than all in the same year.

◆  This process is known as laddering because each group on bonds represents a rung on the investments maturity ladder.

Advantages :
Beneficial in both situation when interest rate rise or fall.Effective tool for someone who needs large mounts of money available on certain future dates, for example, to pay for a child education.
If interest rates plunge, invester would be better off owning only long term bonds.Ladders also not make sense for investors with small amounts of money.

◆  Bond immunization is an In…

How to invest in Mutual Funds ?

What is a Mutual Fund?
* A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal.

*  Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds.

*  These investors buy units of a particular Mutual Fund scheme that has a defined investment objective and strategy.

*  The money collected is invested by the fund manager in different types of securities.  These could range from shares to debentures to money market instruments, depending upon the scheme's stated objectives.

Mutual Fund is ......
● A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal.

●. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds.

●. These investors buy units of a particular Mutual Fund scheme that has a defined investment objective and strategy.

●. The money collected is invested by the fund manager in different types of securiti…