Samenvatting
Introduction to financial markets
UNIT 1
Section 1
Haves own capital, they can lend it out = Lenders
Havenots more needs then money, they need extra money = Borrowers
Government = havenots, a government has a lot of dept
Corporate = havenots, work with other people’s money
Family’s = haves, the money is devided over different family’s, unequal
The main actor: Households
In the end families own the world
Behind every corporate there are individuals
Highly unevenly distributed over the population
The more corporates you own/assets you own, the more risk you take
Net wealth = assets – liabilities
What do you really have
Household balance sheet
- Real Assets
- Financial Assets
Tangible assets = real assets, physical so therefore they have value
Intangible assets = a legal claim to future benefit
Finacnial assets = intangible assets that represent a claim to future cash
Traditional assets Alternative assets
- Common stock - Real estate
- Bonds - Commodities
- Cash - Private equity
- Hedge funds
- Venture capital
- Currencies
, Wealth
Growth drivers in wealth
Value changes in assets and liabilities
Net-income of labour, capital or tranfsers
Inheritances or gifts
Wealth creation
The poor have no assets/liabilities
Middle class are poor families with a home,
Rich have a lot of assets and different forms of income
Wealth is distributed unevenly in the world
Developed economies: less inequality
Emerging markets: High inequality
Section 2
Balance sheets of the other actors
Companies
Liabilities “side”
Equity
Shareholders, they own the company
Debt
Have given money to the company but don’t have anything to say
Everything the company has borrowed
E.G. ; Bonds, investment loans, other bank loans, trade credit,…
Assets “side”
Fixed assets
Long term commitment
Current assets
Leverage
When companies use dept to finance their operations
Return on assets = return you get with alk the money you use
Return on equity = interesting for shareholder
ROE = ROA x LM
LM = leverage multiplier
Gearing ratio = the ratio between long-term debt and equity
The net gearing ratio = the ratio of the financial debt and the equity
Introduction to financial markets
UNIT 1
Section 1
Haves own capital, they can lend it out = Lenders
Havenots more needs then money, they need extra money = Borrowers
Government = havenots, a government has a lot of dept
Corporate = havenots, work with other people’s money
Family’s = haves, the money is devided over different family’s, unequal
The main actor: Households
In the end families own the world
Behind every corporate there are individuals
Highly unevenly distributed over the population
The more corporates you own/assets you own, the more risk you take
Net wealth = assets – liabilities
What do you really have
Household balance sheet
- Real Assets
- Financial Assets
Tangible assets = real assets, physical so therefore they have value
Intangible assets = a legal claim to future benefit
Finacnial assets = intangible assets that represent a claim to future cash
Traditional assets Alternative assets
- Common stock - Real estate
- Bonds - Commodities
- Cash - Private equity
- Hedge funds
- Venture capital
- Currencies
, Wealth
Growth drivers in wealth
Value changes in assets and liabilities
Net-income of labour, capital or tranfsers
Inheritances or gifts
Wealth creation
The poor have no assets/liabilities
Middle class are poor families with a home,
Rich have a lot of assets and different forms of income
Wealth is distributed unevenly in the world
Developed economies: less inequality
Emerging markets: High inequality
Section 2
Balance sheets of the other actors
Companies
Liabilities “side”
Equity
Shareholders, they own the company
Debt
Have given money to the company but don’t have anything to say
Everything the company has borrowed
E.G. ; Bonds, investment loans, other bank loans, trade credit,…
Assets “side”
Fixed assets
Long term commitment
Current assets
Leverage
When companies use dept to finance their operations
Return on assets = return you get with alk the money you use
Return on equity = interesting for shareholder
ROE = ROA x LM
LM = leverage multiplier
Gearing ratio = the ratio between long-term debt and equity
The net gearing ratio = the ratio of the financial debt and the equity
