FINANCING WITH SHARES, INVESTMENTS. By Nikita Kononov MTS-11
1. Shares; 2. Instruments and stock exchanging; 3. Mutual funds; 4. Future of shares financing.
SHARES • A share is a single unit of ownership in a corporation, mutual fund, or other organization. A joint stock company divides its capital into shares, which are offered for sale to raise capital, termed as issuing shares. Thus, a share is an indivisible unit of capital, expressing the proprietary relationship between the company and the shareholder. The denominated value of a share is its face value: the total capital of a company is divided into number of shares • In financial markets, a share is a unit of account for various financial instruments including stocks (ordinary or preferential), and investments in limited partnerships, and real estate investment trusts.
SHARES • The income received from shares is known as a dividend. A shareholder, also known as a stockholder, is a person who owns shares of a certain company or organization, and is thus a part-owner of the company. The process of purchasing and selling shares often involves going through a stockbroker as a middle man. • In financing with shares could be placed Brokerage services. It is Operations with securities at the expense of and on behalf of clients.
INSTRUMENTS AND STOCK EXCHANGES Two main instrument actions in Financing with shares. The fist are next Bank clients can conduct operations: • On the MICEX Stock Exchange (stocks, corporate, municipal and subfederal bonds) • On the Moscow Interbank Currency Exchange (federal loan bonds and Bank of Russia bonds) • On the RTS Stock Exchange (futures contracts of the FORTS derivatives market) • On the St. Petersburg Stock Exchange (stocks of Gazprom OJSC) • On the OTC market
INSTRUMENTS AND STOCK EXCHANGES And Second are several ways to interact with a broker: • Using Internet-trading system: QUIK or FOCUS IV online • By personally submitting an order at the location of service provision • By submitting an order over the telephone
INSTRUMENTS AND STOCK EXCHANGES Procedure for the Agreement Conclusion A brokerage agreement can be concluded at branch of the banck (or a branch offering these services). The procedure for client servicing is governed by Conditions for the Provision of Brokerage Services (available only in Russian), and by Terms and Conditions for Custody Services(available only in Russian). The agreement between the Bank and the Client is concluded by the Client accepting the Bank's offer to conclude the Contract, i. e. by means of client accession to the abovementioned conditions according to art. 428 of the Civil Code of the Russian Federation.
INSTRUMENTS AND STOCK EXCHANGES For the execution of an order to purchase securities cash funds are required in the amount necessary for conducting settlements, payment of Bank remuneration, and other remuneration related to the conclusion of transactions and associated settlements. For the execution of an order to sell securities, securities are required in the amount enough for settlements to be made on the transaction. Bank deposit services are paid according to the custody service rates. In accordance with the results of the transaction, concluded according to the client's orders, the client is provided with a brokerage report on the flow of securities and cash funds movements at close of trading.
MUTUAL FUNDS Asset Management offers professional asset management services in the securities market through collective investment vehicles – mutual funds.
MUTUAL FUNDS Advantages of mutual funds: • Professional management. • Transparency. • Diversification. • Liquidity. • Low threshold. • Convenience.
MUTUAL FUNDS Mutual fund share transactions can be effected from any location An investment in mutual fund shares makes you a full-fledged participant of the stock market. All transactions in securities and other assets are carried out by the asset management company
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