Chapter 19 The Capital Market 19-1
19-1 Chapter 19 The Capital Market
The Capital Market Public ssue Privileged Subscription Regulation of Security Offerings Private placement Initial Financing Signaling effects The Secondary Market 19-2
19-2 The Capital Market Public Issue Privileged Subscription Regulation of Security Offerings Private Placement Initial Financing Signaling Effects The Secondary Market
Capital Market Capital Market - The market for relatively long-term greater than one year original maturity) financial instruments Primary Market-A market where new securities are bought and sold for the first time(a new issues market) Secondary Market-A market for existing (used) securities rather than new issues 19-3
19-3 Capital Market Capital Market -- The market for relatively long-term (greater than one year original maturity) financial instruments. Primary Market -- A market where new securities are bought and sold for the first time (a new issues market). Secondary Market -- A market for existing (used) securities rather than new issues
Capital Market INVESTMENT SECTOR □ Public issue Privileged subscription FINANCIAL BROKERS 安 u2au2u-z Private placement Indicates the possible presence of a SECONDARY MARKET+ standby arrangement Indicates the financial intermediaries?own SAVINGS SECTOR securities flow to the savings sector 194
19-4 Capital Market INVESTMENT SECTOR FINANCIAL INTERMEDIARIES SAVINGS SECTOR FINANCIAL BROKERS SECONDARY MARKET Public issue Privileged subscription Private placement Indicates the possible presence of a standby arrangement Indicates the financial intermediaries?own securities flow to the savings sector
Public issue Public issue a sale of bonds or stock to the general public Securities are sold to hundreds and often thousands, of investors under a formal contract overseen by federal and state regulatory authorities When a company issues securities to the general public, is usually uses the services of an investment banker 19-5
19-5 Public Issue Securities are sold to hundreds, and often thousands, of investors under a formal contract overseen by federal and state regulatory authorities. When a company issues securities to the general public, is usually uses the services of an investment banker. Public Issue -- Sale of bonds or stock to the general public