C先生对《Financial Markets and Institutions》的笔记(2)
C先生 (做一个有故事的人。)
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Overview of Financial System
Securities: 1. Bonds 2. Stocks/Equity Bonds: Debt, fixed interest rate Stocks: Dividends rise as corporations profit. Primary Market: Behind Scene, Secondary Market: Stock Market, Future..options Corporations pay debt-holders before shareholders Money Market/Short-term more liquid- Capital Market/Long-term International Bond market: Eurodollar, Eurocurrency
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Efficiency of Market
In an efficient market, all unexploited profit opportunities will be eliminated; optimal forecast of the return/that of one particular firm is equal to the equilibrium market return. Higher return, higher price, then, lowering optimal forecast of the return.