Posts

Showing posts from November, 2018

6 issues make you control your Credit Score like a toy

Image
It is known that the higher your Credit Score, the more financial freedom it will give you. Many people fall the trap of credit cards without feeling, till that they find themselves in a serious financial predicament I'll show you here 6 elements that are the main control in raising or lowering your Credit Score, so if you know how to control it, you can reach a strong credit level of up to 7.5 points in one year. Which will allow you to get whatever you want "new home, car or cover education expenses". 1. Credit Used Credit Used is Very High Impact on Credit Score, If you use too much of your available credit, you may not have enough credit when you need it. To lenders, this could be a sign that you may be overextended. Use less than 30% of your available credit is a good goal. But, keep in mind that using some available credit and paying it off monthly may be better than not using any credit at all. Lenders see the good AVERAGE of using the credit money is 31%

Regulatory Requirements of Broker-Dealers

Image
FINRA member broker-dealers must have principals, also known as supervisors . For most firms, one of these principals must be registered as a Series 27 - Financial and Operations Principal (FINOP). A "FINOP" principal can supervise the following activities: •    Back office operations •    Preparation and maintenance of a member firm's books and records. •    Compliance with financial responsibility rules that apply to self-clearing broker-dealers and market makers. A principal with a Series 27 registration is responsible for filing regular FOCUS (Financial and Operational Combined Uniform Single) reports. FOCUS reports show items including amounts the firm owes to customers and other parties, as well as amounts owed to the firm. Securities borrowed for short sales, and securities that were failed to receive are also indicated. Also, the current values of securities owned by the firm are listed. The SEC establishes broker-dealer net capital requirements under the Securi

Types of Broker-Dealer Businesses in Secutiries Markets

Image
An introducing broker-dealer has a relationship with customers in which it makes recommendations to customers on how and what to trade, but let’s another firm handle the execution of the trades. A firm that executes transactions for an introducing broker-dealer is sometimes called an executing broker-dealer . The introducing and executing broker-dealers split commissions/fees according to a written agreement. An introducing broker-dealer more typically contracts with a carrying broker-dealer . The carrying broker-dealer acts as the introducing broker-dealers back office, handling customer assets and clearing transactions through a clearing broker-dealer . FINRA requires the firms to execute a contract between the carrying firm and the introducing firm stipulating the terms of the agreement for the carrying firm to hold customer assets and execute trades on behalf of the introducing firm. Or, an introducing broker-dealer may work with a clearing or self-clearing broker-dealer dir

the most important facts you must to know about Depositories and Clearing Facilities

Image
If a customer buys 500 shares of SBUX, his broker-dealer finds a market maker who wants to sell 500 shares right now at their offer price. Such trades settle "T + 2" or two business days from the trade date. But, what does that part—the next two business days involve, if the trade is already completed? When he buys those 500 shares of SBUX, let's say at $30 a share, his account will show the 500 shares among his positions and will debit the $15,000 plus a commission for the purchase. But, those are just numbers on a screen at this point. Until the transaction is cleared and settled, nothing is completed. The firms that clear transactions in securities are known as clearing agencies or clearing facilities. Clearing Agencies are self-regulatory organizations that are required to register with the Commission. There are two types of clearing agencies -- clearing corporations and depositories. Clearing corporations include: The National Securities Clearing Corporation ,

How is Crowdfunding firms work?

Image
Even though we just looked at concerns for non-accredited purchasers in Reg D private placements, anyone can invest in a "crowdfunding" securities offering. Because of the risks involved with this type of investing, however, investors are limited in how much they can invest during any 12-month period. The limitation depends on net worth and annual income. If either the investor's annual income or net worth is less than $100,000, then during any 12-month period, he can invest up to the greater of either $2,000 or 5% of the lesser of his annual in¬come or net worth. If both his annual income and net worth are equal to or more than $100,000, then during any 12-month period, an investor can commit up to 10% of annual income or net worth, whichever is less, but not to exceed $100,000. As when determining who is and is not an accredited investor, the value of the investor's primary residence is not included in the net worth calculation. In addition, any mortgage or other lo

Transactions & Exempt Transactions

Image
So, commercial paper, T-Notes, and municipal bonds are exempt securities. They are good to go without any paperwork being filed with the SEC. There are also transactions that qualify for exemptions, called exempt transactions . Unlike an exempt security, an exempt transaction must be claimed by the issuer with some paperwork to back up what they did or are about to do. Under Regulation A, for example, an issuer can sell up to $5,000,000 worth of securities in a year without having to jump through all the usual hoops. Rather than filing a standard registration statement, the issuer files an offering circular, a much more scaled-down document. The SEC oversees interstate commerce, meaning commerce among many states. Therefore, if the issuer wants to sell only to residents of one state, the SEC doesn't get involved. There is already a state securities regulator who can deal with this one. Therefore, intrastate offerings are exempt if they match this statement, "Any security which

there is a Exempt Securities from Act of 1933?

Image
The Securities Act of 1933 is a piece of federal legislation, so it's not surprising the federal government is not required to follow it. That's right, government securities are exempt from this act. T-Bills, T-Notes, T-Bonds, STRIPS, and TIPS are not required to be registered. States, counties, and cities those who issue municipal securities also got an exemption from the registration process under the Securities Act of 1933. The federal government generally does not exert that much control over any State or local government, and municipal governments are not as likely to go bankrupt as corporations. So, if a school board puts out an issue of municipal securities based on fraudulent financial statements, the SEC could go after them in federal court. But, these municipal securities issuers do not file registration statements with the SEC and wait for the SEC to tell them it is okay to proceed. Charitable/fraternal/religious/benevolent organization securities are exempt. Bank

Stabilization ... What is it? andh who is responsible for?

Image
Normally, anyone caught trying to artificially move the price of a security on the secondary market is subject to regulatory problems, civil liability to other traders, and sometimes even criminal penalties. If a few big traders of some small-company stock get together and come up with a plan to enter large buy orders at certain times throughout the day to boost the price, they are engaging in market manipulation. On the other hand, right after a new offer of securities, the lead underwriter can prop up the price of the stock on the secondary market to some extent through stabilization .  If the public offering price or POP is $10, but the stock starts trading on NASDAQ or NYSE for only $9.50, the managing/lead underwriter can place bids to buy the stock to provide a floor price for the investors nice enough to buy the IPO. Now, the bid can't be higher than the POP of $10, and it also can't be higher than the highest independent bid for the stock..  That means the bid had bett

what is Types of Offerings differant from common type?

Image
Specific Types of Offerings  In a registered secondary offering the key word is secondary. As with all secondary or non-issuer transactions, the proceeds are not going to the issuer. Rather, they are going to, for example, a former CEO or board member who is now offering his or her restricted shares to the public. The restricted shares were not registered; now they are being registered and offered to investors on the secondary market. Remember that if the issuing corporation does an additional offer of stock, it is not a secondary offering. Rather, it is a "subsequent primary distribution." When the issuer gets the proceeds, the word is "primary," not "secondary." A specific type of firm commitment is called a standby underwriting . While a broker-dealer cannot buy IPO shares for its own account just because it wants to, they can act as a standby purchaser for the issuer, buying any shares the public doesn't. Usually, we associate "standby"

Who is underwriters or Investment Banking .. what is playing?

Image
An investment banking firm negotiates the terms of the underwriting deal with the company planning to go public and then acts as the managing underwriter of a group of underwriters collectively known as the underwriting syndicate. The managing underwriter spells out the basic terms of the underwriting and issues a letter of intent to the issuing corporation in which the risks to and obligations of each side are spelled out. The underwriter relies on a market-out clause, which explains that certain unforeseen events will allow the underwriter to back out of the deal. If the company's drug making facilities are shut down by the FDA due to contamination, for example, the underwriter can back out of the underwriting engagement. This topic may related to SIE exam. For municipal securities and for some corporate securities offerings, a potential managing underwriter submits a bid or responds to an RFP (request for proposals) . This is known as a competitive bid as opposed to a negoti

How do you know if there is securities offering?

Image
To complete a securities offering, under the Securities Act of 1933, an issuer first registers with the Securities and Exchange Commission (SEC) . The SEC is part of the federal government, with the Chairman appointed by the President of the United States. The SEC wants to see what the issuers will tell their potential investors in the prospectus , which is part of the registration statement. They require the issuers to provide the material or relevant facts on the company: history, competitors, products and services, risks of investing in the company, financials, board of directors, officers, etc. And, they require it to be written clearly. Only if investors understand the risks and rewards of an investment do they have a chance of determining a good opportunity from a bad one. This topic may related to SIE exam. The SEC and other securities regulators do not protect investors from making bad choices. Their concern is that the issuer provides enough pertinent information so investor

What is the defrance between Public companies & Privet companies?

Image
Public companies raise money by issuing stocks and bonds to investors, who can trade the securities with other investors on the secondary market. Examples of public companies include Starbucks, Facebook, and McDonald's.   This topic may related to SIE exam. Private companies , on the other hand, are often owned by just one family or a small group of founders and investors. Their securities do not trade on a secondary market. Examples of private companies include The Chicago White Sox, Five Guys, and Koch Brothers. Accessing the public markets provides a large amount of capital for the issuer. But, going forward, a public company must provide full disclosure of material facts to their investors, the securities regulators, and the public. That is why many companies stay private. It is easier to run a business without having to disclose all material information, or worrying about liability to investors for failure to properly disclose something that leads to losses on their stocks or

Ways of Corporat finance ... simply

When a person wants to create a project, he needs funding from his own money. The project is called "individual project". When his own resources are insufficient, he resorts to others either to share with him a limited number of people in the form of a "people's company" or by borrowing from a person or a bank. As the needs of human beings, projects are develop,  and grow in size .they require a large funding to cover the increase in activity . Here, these projects will find it difficult to accumulate funding from a limited number of people. so  shareholding companies are appeared . they divided into equities with equal nominal value, A large number of investors wishing to invest their money, and thus each investor pays a small share of the value of funding for the project and with the increase in the number of investors becomes a large funding required easily accessible. The shareholding companies have two types .  first closed joint stock companies, in which t