1. Financial services comprise of Assisting in Sourcing of funds, (Intermediation),Funding Advising & Procedural assistance in deployment of funds.
2. NBFC stands for Non Banking Finance Company
3. Financial Services can be classified in to Traditional activities and modern activities
4. A merchant banker is a financial intermediary who helps to transfer capital from those who possess it to those who need it
5. Assets: Anything that the firm owns.
6. Financial Intermediaries refers to Financial institutions, banks, NBFCs that assist the transfer of savings from economic agents with excess savings to those that need capital for investments.
7. Bank is a financial institution which accepts deposits and lends that money to its customers
8. A Bank account holds funds within a bank and is subject to additional deposits and withdrawals.
9. Consumer is one who purchases goods and services
10. Credit Card is a bank-issued tag that allows consumers to purchase goods or services on credit.
11. A lease is an agreement under which a company or a firm acquires a right to make use of a capital asset like machinery, on payment of a prescribed fee called ‘rental charges’.
12. Mutual Fund is a trust that pools together the resources of investors to make a foray into investments in the capital market thereby making the investor to be a part owner of the assets of the said fund.
13. A mutual fund refers to a fund raised by a financial service company by pooling the savings of the public. It is invested in a diversified portfolio with a view to spreading and minimizing the risk The fund provides investment avenues for small investors who cannot participate in the equities of big companies. It ensures low risk, steady returns, high liquidity and better capitalization in the long run.
14. Factoring is a service of financial nature involving the conversion of credit bills into cash.
15. Factoring refers to the process of managing the sales register of a client by a financial services company. The entire responsibility of collecting the book debts passes on to the factor.
16. Forfeiting is a technique by which a financing agency discounts an export bill and pays ready cash to the exporter who can concentrate on the export front without bothering about collection of export bills.
17. Securitisation is a technique whereby a financial company converts its ill-liquid, non-negotiable and high value financial assets into securities of small value which are made tradable and transferable.
18. A derivative security is a security whose value depends upon the values of other basic variable backing the security. In most cases, these variables are nothing but the prices of traded securities.
19. Arbitrage is transaction that generates a risk-free profit.
20. Venture capital is a form of equity financing especially designed for funding high risk and high reward projects with the objective of earning a high rate of return.
21. Securitisation is the process by which financial assets such as loan receivables, mortgage backed receivables, credit card balances, hire-purchase debtors, lease receivables, trade debtors, etc., are transformed into securities.
22. Overall Credit worthiness of a borrower measured on predefined scale, assessed by an independent agency and informed to lenders is called credit rating
23. The derivatives are those instruments, which are commonly used to derive therein-exact value of underlying asset of the financial institutional corporate companies
No comments:
Post a Comment