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Fin 370 Week 1 Essay

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Below is an essay on "Fin 370 Week 1" from Anti Essays, your source for research papers, essays, and term paper examples.

Defining Financial Terms
Kyle O. Flinn
June 11, 2012
Marilyn Waters

Defining Financial Terms

Finance – Is the management of revenues; the conduct or transaction of money matters generally, especially those affecting the public, as in the fields of banking and investment.
Role - Finance is how investors assign their assets over time under circumstances of certainty and uncertainty.

Efficient market - An investment theory that states it is impossible to "beat the market" because stock market efficiency causes existing share prices to always incorporate and reflect all relevant information.
Role - Proclaims that financial markets are "information ally efficient".

Primary market –   A market that issues new securities on an exchange.
Role - The market that is part of the capital markets that deals with the issuance of needs of securities.

Secondary market -   A market where investors purchase securities or assets from other investors, rather than from issuing companies themselves.
Role - Also called aftermarket, is the financial market in which formerly issued financial instruments such as stock, bonds, options, and futures are bought and sold.

Risk - The potential that a chosen action or activity (including the choice of inaction) will lead to a loss (an undesirable outcome).
Role - Chance that an investment’s actual return will be better than expected. It includes the possibility of losing some or all of the original investment.

Security - Is the degree of protection against danger, damage, loss, and crime.
Role – Is the way to insure money or investments from total loss.

Stock - The capital market (or simply stock) of a business entity represents the original capital paid into or invested in the business by its founders.
Role - Type of security that shows ownership in a corporation and represents a claim on part of the corporation's assets and earnings.

Bond - A debt investment in which an investor loans money to...

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