投资学英文版课件Ch 3 Securities markets

Chapter3SecuritiesMarketsChapter3coversSecondarymarketsandthemarketmakersThemechanicsofinvestinginsecuritiesForeignSecuritiesThemarginpurchaseandshortsaleofstocksRegulationofsecuritiesindustryMayo/BasicInvestments-Ch032Chapter3SecuritiesMarketSection1-SecondaryMarketsandroleofmarketmakersSection2-TheMechanicsofInvestinginSecuritiesSection3—ForeignSecuritiesSection4--ThemarginpurchaseandshortsaleofstocksSection5RegulationofsecuritiesindustryMyo/BasicInvestments-Ch033Section1

—SecondaryMarketsandroleofmarketmakers

levelsofsecuritiesmarketsroleofmarketmakerspricespreaddeterminationofpricesreportingoftransactionscompositetransactions（混合交易）

Characteristics۞

Differentrequirementsforgoingpublic۞tosatisfydifferentneedsoffinancing

۞

themorenationwide,thestricterrequirements,andthemorefundsraised۞

notclose-end,connectedeachotherlevelsofsecuritiesmarketsTwolevelsSecondaryMarketsPrimaryMarkets1234BigBoard(NYSE,AMEX)OTC(Nasdaq)Blocktrades(OTCBB,PinkSheets-NQB)Fourthmarkets(Instinet)电子交易系统FourtypesRoleofMarketMakers

DealeranyoneengagesinthebusinessofbuyingandsellingforhisownaccountSpecialistsdealersontheNYSEwhomaintainsanorderlymarketinsecuritiesMarketmakersDealersintheOTCmarkets,suchasNASDAQ

发行者（筹资者）

投资者（股东）新发行的股票资金

投资者投资者投资者股票股票资金资金发行市场二级市场交易所交易参与方证券交易所结算所经纪商和自营商投资者roles12OffertobuysecuritiesfromanysellerOffertosellsecuritiestoanypurchaser

makemarketsinsecuritiesTransactions

Aroundlot※thenormalunitoftrading※usually100sharesofstocksOddlots◎smallerthanthegeneralunitofsale◎37sharesofstocksVastmajorityoftradesPriceSpreadSecuritydealersquotepricesonabidandaskbasis.Bid—buyingpriceAsk—sellingpricespreadThedifferencebetweenthebidandtheaskpricesFormarketmakers—aprimarysourceofcompensationForinvestors—costofinvestingDeterminationofPricesThesecuritypricesarequotedbymarketmakersaresetbythedemandfromallbuyersandthesupplyfromallsellersofsecurities.Equilibriumprice۩

quotedbymarketmakers;۩equatesthesupplywiththedemand;

IfquoteabovetheequilibriumpriceஇexcessivesupplyஇabsorbedbymarketmakersIfquotebelowtheequilibriumprice۞

excessivedemand۞providedbymarketmakersMarketmakerscannotquotethebidandaskpricesatwill,andtheytrytosetasecurity’sequilibriumprice.另外一种证券交易方式：竞价交易竞价制度,也称指令(委托)驱动交易制度、双向拍卖制度,主要特点是严格遵循价格优先、时间优先的原则

竞价交易制度竞价制度又分成连续竞价制度和集合竞价制度,前者适用于日内连续交易,对市场流动性的要求最高；后者适用于确定开盘、收盘价格等,对市场流动性的要求相对较低

ReportingofTransactionsDailytransactionsonthelistedexchangearereportedbythefinancialpress.Weeklysummariesarealsoreportedinseveralpublications.VariationinthereportingSomesimilarformatYTD%CHGPercentagechangeinthepriceofthestockduringthecurrentcalendaryearHIThehighpricesofthestockLOThelowpricesofthestockSTOCKThenameofthecompany(SYM)ThetickersymbolinboldprintDIVAnnualdividendpaidorannualdividendrateYLD%ThedividenddividedbythepriceofthestockPETheratioofthestockpricetothecompany’sper-shareearningsVOL100sThevolumeofsharestradedexpressedinhundredsLASTTheclosingpriceofthestockNETCHGThechangefromtheclosingpriceonthepreviousdayoftradingOtherreportingThereportingofNasdaqnational-marketissuesisessentiallythesameasthereportingofNYSE-listedsecurities.纳斯达克全国市场板ThereportingofNasdaqsmallcapissuesorbulletinboard(OTCBB)issues:NotreportedinthefinancialpressbutinthepinksheetsContents:information,dividends,volume,lastprice,pricechanges;纳斯达克小公司市场板Section2:

TheMechanicsof

InvestinginSecuritiesA.B.C.D.RoleofbrokersLongandshortpositionsTypesoforderCashandmarginAccountsE.DeliveryofSecuritiesF.CostofInvestingGShortSale交易所交易参与方证券交易所结算所经纪商和自营商投资者A-RoleofBrokersbrokerAnagentwhohandlesbuyandsellordersforaninvestorBrokeragefirmsDealers—marketmakersBrokers—accountexecutives(账户执行人)Forthefirms’accountForcustomers’accountsHowtobecomebrokers?PasstheproficiencyexaminationadministeredbytheNationalAssociationofSecuritiesDealers;Practices;Aregisteredrep.Twokindsofbrokeragefirms:full-servicefirms—higherfeesandcommissions;moreservicesdiscountbrokeragefirms—lowercommissions,lessservices;B.Long&ShortPositionsAninvestorhasonly2coursesofaction,whichinvolveoppositepositions.2oppositepositionsBull(long)position多头Bear(short)position空头Bullish看涨的Bearish看跌的Expectingasecurity’spricetorisePurchasingthesecurityTotakealongposition;BebullishExample:---tobuy100sharesofAB&Cfor$55;---thepricerisesto$60;---theprofitonthelongpositionis$5pershare.LongPosition:Owningassetsfortheirincomeandexpectingpossiblepriceappreciation.Expectingasecurity’spricetofallSellingthesecurityTotakeashortposition;Bebearish;Investorsholdscashorplacesthefundsininterest-bearingshort-termsecurities(T-billsorasavingsaccount).Someinvestorsmayspeculate—sellshort;andgetprofits.ShortPosition:Sellingassetsforpossiblepricedecline;beingshortinasecurityoracommodity.C.TypesofOrdersTypesoforders

TobuyTosell

Marketorder市价委托Limitorder限价委托Dayorder当日有效委托指令

Good-till-canceledorder长期有效委托指令

Stoporder止损委托Stop-lossorderStop-sellorder

MarketorderLimitorder

证券交易委托指令是投资者通知经纪人进行证券买卖的指令，其主要种类有：

(1)市价委托（MarketOrder）

(2)限价委托(LimitOrder)(3)停止损失委托（StopOrder）

(4)停止损失限价委托（StopLimitOrder）

证券交易委托指令的种类AMarketOrderMarketorderAnordertobuyorsellatthecurrentmarketpriceorquoteBestpricecurrentlyavailableInvestorsdon’tneedtosetapriceinhisorder2.Generallyexecutedatorveryneartheaskingorbidprice.Investorsareassuredofbuyingorsellingthesecuritysoonbutnotassuredofexecutionatthecurrentlyquotedpriceduetothepricechanges;ALimitOrderAlimitorderAnorderplacedwithabrokertobuyorsellataspecifiedprice12A-day-order

isanorderplacedwithabrokerthatiscanceledattheendofthedayifitsisnotexecuted.A-good-till-canceled-order

isanorderplacedwithabrokerthatremainsineffectuntilitisexecutedbythebrokerorcanceledbytheinvestor.Investorsneedtosetaprice(p)inhisorderBuyingprice≤pSellingprice≥pButinvestorsarenotinsuredofexecutionAStopOrderAstoporderAsellorderdesignedtolimitaninvestor’slossortoassureaprofitonapositioninasecurity12Astop-lossorderisanorderwhichspecifiesthepricebelowthecostofthesecurityatwhichthebrokerisauthorizedtosell.Astop-sellorderisanorderwhichspecifiesthepriceabovethepurchasepriceatwhichthebrokerisauthorizedtosell.Astop-lossorderPurchasedfor$50pershare$45pershare(-10%)Thesellingpriceisatorbelow$45pershare.Astop-sellorderPurchasedfor$50pershare$60pershareTolimitthepotentialprofitifpricecontinuingtorise挂单于现价之下追空Comparisonoflimit,stopandmarketorderLimitorderinsuresthepricesetintheorderbutnottheexecutionStoporderinsurestheexecutionbutnotinsurestheprice(likemarketorder)MarketorderinsurethesoonestexecutionatorverynearthecurrentquotingpriceDifferencesLimitorders&StopordersTosell$20$25buyAlimitordertosell/purchaseat$25:therealsell/purchasingpricewouldbemore/lessthan$25orequalto$25.Astop-lossordertosellat$20:therealsellingpricemaybelessthan$20.$19TosellAStop-limitOrderThesaleorder;Combinesastop-losswithalimitorder;Tosell$25$20Astop-limitorderat$20$19AConfirmationStatement

交易确认书、确认函

Astatementreceivedfromabrokeragefirmdetailingthesaleorpurchaseofasecurityandspecifyingasettlementdate.

ExampleAninvestorbought100sharesofCleverpakCorporationwiththeunitpriceof$12.13.SettlementDate—thedaythepaymentisdueTransactionfees—commissions，transferfeeandothermiscellaneousfees过户费和杂费Unitprice;totalamountT+3:threebusinessdaysafterthetradedate;1234D.CashandMarginAccountsCashAccountsInvestorspaytheentirecostofsecuritiesincash.MarginAccountsInvestorspurchasesthesecuritiespartiallywithcashandpartiallywithcreditsuppliedbybrokers.MarginRequirementTheminimumpercentageofthetotalpricethattheinvestorpayandissetbytheFederalReserveBoard.IndividualbrokersmayrequiremoremarginInvestorspayinteresttothebrokerwholends;InvestorsusemargintoincreasepotentialROI;ExampleofMarginRequirement1CashMargin(60%requirement)Buyingprice$1000$1000(with$600cashpaymentand$400borrowed)Sellingprice$1400$1400profits$400$400ROI40%67%Notice:Theuseofmarginisfavorable.ExampleofMarginRequirement2CashMargin(60%requirement)Buyingprice$1000$1000(with$600cashpayment)Sellingprice$700$700losses$300$300ROI-30%-50%Notice:Theuseofmarginisunfavorable.ExampleWhat’stheROIonthecashpurchaseandmarginpurchaserespectively?(Lastparagraphonp19)ExampleofMarginRequirement3CashMarginSaleprice$1400$1400Commission

50/70

50/70Proceedsofsale13301330Loanpayment0420Cashreceived1330910Dividendsreceived100100Interestpaid042ROI36.2%53.7%ConclusionTheuseofmarginmagnifiesnotonlythepotentialgainbutalsothepotentiallossMaintenanceMarginTheminimumequityrequiredforamarginposition.MaintenancemarginpurposeProtectthebrokerfromtheinvestor’sdefaulting;AMarginCallAMargincallArequestbyabrokerforaninvestortoplaceadditionalfundsorsecuritiesinanaccountascollateralagainstborrowedfundsorasagoodfaithdeposit.MarginTransactionsInitialmarginrequirementatleast50%.SetupbytheFed.MaintenancemarginRequirementproportionofequitytostockProtectsbrokerifstockpricedeclinesMinimumrequirementis25%MargincallonundermarginedaccounttomeetmarginrequirementIfmargincallnotmet,stockwillbesoldtopayofftheloanmaximumminimumAmargincallAdvanceadditionalfundsequitypositionMarginTransactionsChangesinpriceaffectinvestor’sequitypositionMarginTransactionsBuy200sharesat$50=$10,000positionBorrow50%,investmentof$5,000Ifpriceincreasesto$60,positionValueis$12,000Less-$5,000borrowedLeaves$7,000equityfora$7,000/$12,000=58%equitypositionMarginTransactionsBuy200sharesat$50=$10,000positionBorrow50%,investmentof$5,000Ifpricedecreasesto$40,positionValueis$8,000Less-$5,000borrowedLeaves$3,000equityfora$3,000/$8,000=37.5%equityposition

Margincallprice

Whenequityposition≤

MaintenanceMarginrequirement,theinvestorsreceivemargincallfromthebroker.Margincallprice=Equityposition=

minimumequityadded=maintenancemarginE.DeliveryofSecurities

takedelivery

leavethesecuritieswiththebrokerToregisteredinthebrokeragefirm’sname(inthestreetname)Receivethestockcertificatesorbonds5%95%F.CostofInvestingTaxes—securitiesdealingsTransferfees;othermiscellaneousfeesCommissionfees123Mostobviouscost;Canbenegotiable;Thesaleofborrowedsecuritiesinanticipationofapricedecline;Acontractforfuturedelivery;FShortsaleOtherexamplesMagazine—subscription;Professionals—lawyer,engineer,teacher…RationaleforshortsaleSellborrowedsecuritiesBuybacksecuritiesandreturntohisbrokerprofitsCharacteristicsAcurrentsalewithacontractforfuturedelivery;Processofshortsale:borrowedsecuritiesfirstthensellthem(shortsale)buybacksecuritiesandthenreturnthemExpectthedeclineofsecuritiespriceWhosesecuritiescanbelent?Ifinvestorsregisterhisorhersharesinacashaccount,thebrokeragefirmscannotlendthemtoshortsellers;Ifinvestorsregistertheirsharesinamarginaccount,onepartofthemarginagreementpermitsthebrokeragefirmstolendtheshares.ACoveringtheShortSale

空头回补、平仓Theproceedsofshortsalearenotremittedtosellersbutareheldbythebroker.Theproceedswillsubsequentlybeusedtorepurchasethestock.Suchrepurchasesarereferredtoacoveringtheshortsale.MarginrequirementClosingthePositionAftershort-sellersbuytheshares,thebrokeragefirmsgetthembackandclosethesellers’position.SellingpriceminuspurchasingpriceminusanyothercostsFigure1.1TheFlowofMoneyandCertificatesinaShortSalesellerTheflowofmoney:$5000proceedsfromthebuyer(tobroker);$3000marginfromtheshortseller(tobroker);Thecertificatesinashortsale:Shortsellerborrowed100sharesfrombroker;Shortsellersold100sharestothebuyer;Shortseller’saccount:shortthe100sharesFigure1.2TheFlowofMoneyandCertificatesWhenCoveringaProfitableShortSaleWhencoveringaprofitableshortsale:Shortsellersold100sharesat$5000Shortsellerbought100sharesat$4000Shortsellerreturned100sharestobrokerShortsellergot$1000netprofits;$3000margin

CoveringafailedshortsaleWhencoveringafailedshortsale:Shortsellersold100sharesat$5000Shortsellerbought100sharesat$6000Shortsellerreturned100sharestobroker;Shortsellergot$1000netlosses;$3000margin($2000back)Nakedshortselling---investorsdirectlysellstocksthattheydon’townorhold.---beforethematuritydate(valuedate;deliverydate),investorsjustgotothemarket,buystocksanddeliverthem;It’slegal

todonakedshortsellinginUSsecuritiesmarket,butit’sunlawful

touseittodepressstockprices.Muchtroublecausedbynakedshortselling:UnbelievableprofitsShortsellers(hedgefunds)targetsomeshareswithalotofrealorfalseunfavorableinformation;Nakedshortsellingoftheseshareswiththehelpofunfavorablenews;Buythematverycheapprice;CausefluctuationsinsecuritiesmarketExamples:LehmanBrothers1850-2008Stockpricecutdownfrommorethan$60atthebeginningof2008to$7.79beforeSeptember15,2008.Oneofreasons—nakedshortsellingTheUptickRule报升\提价规则

高于前成交价It’soneimportantconstraintonshortsale.Shortsellerscanexecuteshortsellingonlywhenthechangeinthepriceofthestockisanuptick.Ifthepriceofastockmovesupfromtheprevioustrade,thatisanuptick.Ifthepriceofthestockdeclinesfromtheprevioustrade,thatisadowntick.Section3ForeignSecuritiesForeignSecuritiesForeignstockstradedinAmericanmarketsAmericanDepositoryReceipts(ADRs)AvoidstheproblemoflanguageExpressedindollarsandnotlocalcurrencyMayo/BasicInvestments-Ch0382Section4

RegulationTheSecuritiesandExchangeCommission(SEC)FulldisclosureofinformationRegistration