Posts Tagged ‘financial’

Financial Translation 財經翻译

July 11, 2013 Leave a comment

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Securities 证券

September 1, 2012 Leave a comment

Securities  证 券


A security or financial instrument is a tradable asset of any kind. Securities are broadly categorized into:


  • debt securities (such as banknotes, bonds and debentures),
  • equity securities, e.g., common stocks; and,
  • derivative contracts, such as forwards, futures, options and swaps.
  • 债务证券 (如钞票,债券和债权证),
  • 股权证券,例如普通股票;以及
  • 衍生品合约,有远期,期货,期权和掉期。

The company or other entity issuing the security is called the issuer. A country’s regulatory structure determines what qualifies as a security. For example, private investment pools may have some features of securities, but they may not be registered or regulated as such if they meet various restrictions.


Securities may be represented by a certificate or, more typically, “non-certificated”, that is in electronic or “book entry” only form. Certificates may be bearer, meaning they entitle the holder to rights under the security merely by holding the security, or registered, meaning they entitle the holder to rights only if he appears on a security register maintained by the issuer or an intermediary. They include shares of corporate stock or mutual funds, bonds issued by corporations or governmental agencies, stock options or other options, limited partnership units, and various other formal investment instruments that are negotiable and fungible.



Contents  目录

1. Classification  分类

1.1 New capital  新资本

1.2 Repackaging  重新包装

1.3 Type of holder  持有人类型

1.3.1 Investment  投资

1.3.2 Collateral  抵押品

2. Debt and equity  债务与股权

2.1 Debt  债务

2.2 Equity  股权

2.3 Hybrid  混合

3. The securities markets  证券市场

3.1 Primary and secondary market  初级与二级市场

3.2 Public offer and private placement  公开招股和私募配售

3.3 Listing and OTC dealing  上市与场外交易

3.4 Market  市场

4. Physical nature of securities  证券的实体本质

4.1 Certificated securities  凭证证券

4.2 DRS securities  直接登记系统证券

4.2.1 Bearer securities  不记名证券

4.2.2 Registered securities  记名证券

4.3 Non-certificated securities and global certificates


4.3.1 Non-certificated securities  无凭证证券

4.3.2 Global certificates, book entry interests, depositories


4.3.3 Other depositories: Euroclear and Clearstream


4.4 Divided and undivided security  已分与未分证券

4.5 Fungible and non-fungible security  可互换与不可互换证券

5. Regulation  监管

6. See also  另见

7. Notes  注

8. Glossaries  术语录


Classification  分类

Securities may be classified according to many categories or classification systems:


  • Currency of denomination
  • Ownership rights
  • Terms to maturity
  • Degree of liquidity
  • Income payments
  • Tax treatment
  • Credit rating
  • Industrial sector or “industry”. (“Sector” often refers to a higher level or broader category, such as Consumer Discretionary, whereas “industry” often refers to a lower level classification, such as Consumer Appliances. See Industry for a discussion of some classification systems.)
  • Region or country (such as country of incorporation, country of principal sales/market of its products or services, or country in which the principal securities exchange where it trades is located)
  • Market capitalization
  • State (typically for municipal or “tax-free” bonds in the U.S.)
  • 货币面值
  • 所有权
  • 期满期限
  • 套现程度
  • 收入支付
  • 税务处理
  • 信贷评级
  • 行业业界或“行业”(“业界”通常都指更高水平或更广泛的范畴,如“非必需消费品”,而“行业”通常都指较低层次的级别,如“家用电器”。见“行业”一文讨论的一些级别系统)
  • 区域或国家 (如公司注册国,产品与服务的原销售/市场国,或者原证券在交易所买卖的国家)
  • 市值
  • 州 (典型如美国的市政府或“免税”债券)

New capital  新资本

Securities are the traditional way that commercial enterprises raise new capital. These may be an attractive alternative to bank loans depending on their pricing and market demand for particular characteristics. Another disadvantage of bank loans as a source of financing is that the bank may seek a measure of protection against default by the borrower via extensive financial covenants. Through securities, capital is provided by investors who purchase the securities upon their initial issuance. In a similar way, a government may issue securities to when it needs to increase government debt.


Repackaging  重新包装

In recent decades, securities have been issued to repackage existing assets. In a traditional securitization, a financial institution may wish to remove assets from its balance sheet to achieve regulatory capital efficiencies (the informal ratio of output divided by capital expenditure) or to accelerate its receipt of cash flow from the original assets. Alternatively, an intermediary may wish to make a profit by acquiring financial assets and repackaging them in a way more attractive to investors. In other words, a basket of assets is typically contributed or placed into a separate legal entity such as a trust or SPV, which subsequently issues shares of equity interest to investors. This allows the sponsor entity to more easily raise capital for these assets as opposed to finding buyers to purchase directly such assets.


Type of holder  持有人类型

Investors in securities may be retail, i.e. members of the public investing other than by way of business. The greatest part of investment, in terms of volume, is wholesale, i.e. by financial institutions acting on their own account, or on behalf of clients. Important institutional investors include investment banks, insurance companies, pension funds and other managed funds.


Investment  投资

The traditional economic function of the purchase of securities is investment, with the view to receiving income and/or achieving capital gain. Debt securities generally offer a higher rate of interest than bank deposits, and equities may offer the prospect of capital growth. Equity investment may also offer control of the business of the issuer. Debt holdings may also offer some measure of control to the investor if the company is a fledgling start-up or an old giant undergoing ‘restructuring’. In these cases, if interest payments are missed, the creditors may take control of the company and liquidate it to recover some of their investment.


Collateral  抵押品

The last decade has seen an enormous growth in the use of securities as collateral. Purchasing securities with borrowed money secured by other securities or cash itself is called “buying on margin”. Where A is owed a debt or other obligation by B, A may require B to deliver property rights in securities to A, either at inception (transfer of title) or only in default (non-transfer-of-title institutional). For institutional loans, property rights are not transferred but nevertheless enable A to satisfy its claims in the event that B fails to make good on its obligations to A or otherwise becomes insolvent. Collateral arrangements are divided into two broad categories, namely security interests and outright collateral transfers. Commonly, commercial banks, investment banks, government agencies and other institutional investors such as mutual funds are significant collateral takers as well as providers. In addition, private parties may utilize stocks or other securities as collateral for portfolio loans in securities lending scenarios.


On the consumer level, loans against securities have grown into three distinct groups over the last decade:

1) Standard Institutional Loans, generally offering low loan-to-value with very strict call and coverage regimens, akin to standard margin loans;

2) Transfer-of-Title (ToT) Loans, typically provided by private parties where borrower ownership is completely extinguished save for the rights provided in the loan contract; and

3) Non-Transfer-of-Title Credit Line facilities where shares are not sold and they serve as assets in a standard lien-type line of cash credit.

Of the three, transfer-of-title loans have fallen into the very high-risk category as the number of providers has dwindled as regulators have launched an industry-wide crackdown on transfer-of-title structures where the private lender may sell or sell short the securities to fund the loan. (See sell short). Institutionally managed consumer securities-based loans, on the other hand, draw loan funds from the financial resources of the lending institution, not from the sale of the securities.







Debt and equity  债务与股权

Securities are traditionally divided into debt securities and equities (see also derivatives).


Debt  债务

Debt securities may be called debentures, bonds, deposits, notes or commercial paper depending on their maturity and certain other characteristics. The holder of a debt security is typically entitled to the payment of principal and interest, together with other contractual rights under the terms of the issue, such as the right to receive certain information. Debt securities are generally issued for a fixed term and redeemable by the issuer at the end of that term. Debt securities may be protected by collateral or may be unsecured, and, if they are unsecured, may be contractually “senior” to other unsecured debt meaning their holders would have a priority in a bankruptcy of the issuer. Debt that is not senior is “subordinated”.


Corporate bonds represent the debt of commercial or industrial entities. Debentures have a long maturity, typically at least ten years, whereas notes have a shorter maturity. Commercial paper is a simple form of debt security that essentially represents a post-dated check with a maturity of not more than 270 days.


Money market instruments are short term debt instruments that may have characteristics of deposit accounts, such as certificates of deposit, Accelerated Return Notes (ARN), and certain bills of exchange. They are highly liquid and are sometimes referred to as “near cash”. Commercial paper is also often highly liquid.


Euro debt securities are securities issued internationally outside their domestic market in a denomination different from that of the issuer’s domicile. They include eurobonds and euronotes. Eurobonds are characteristically underwritten, and not secured, and interest is paid gross. A euronote may take the form of euro-commercial paper (ECP) or euro-certificates of deposit.


Government bonds are medium or long term debt securities issued by sovereign governments or their agencies. Typically they carry a lower rate of interest than corporate bonds, and serve as a source of finance for governments. U.S. federal government bonds are called treasuries. Because of their liquidity and perceived low risk, treasuries are used to manage the money supply in the open market operations of non-US central banks.


Sub-sovereign government bonds, known in the U.S. as municipal bonds, represent the debt of state, provincial, territorial, municipal or other governmental units other than sovereign governments.


Supranational bonds represent the debt of international organizations such as the World Bank, the International Monetary Fund, regional multilateral development banks and others.


Equity  股权

An equity security is a share of equity interest in an entity such as the capital stock of a company, trust or partnership. The most common form of equity interest is common stock, although preferred equity is also a form of capital stock. The holder of an equity is a shareholder, owning a share, or fractional part of the issuer. Unlike debt securities, which typically require regular payments (interest) to the holder, equity securities are not entitled to any payment. In bankruptcy, they share only in the residual interest of the issuer after all obligations have been paid out to creditors. However, equity generally entitles the holder to a pro rata portion of control of the company, meaning that a holder of a majority of the equity is usually entitled to control the issuer. Equity also enjoys the right to profits and capital gain, whereas holders of debt securities receive only interest and repayment of principal regardless of how well the issuer performs financially. Furthermore, debt securities do not have voting rights outside of bankruptcy. In other words, equity holders are entitled to the “upside” of the business and to control the business.


Hybrid  混合型

Hybrid securities combine some of the characteristics of both debt and equity securities.


Preference shares form an intermediate class of security between equities and debt. If the issuer is liquidated, they carry the right to receive interest and/or a return of capital in priority to ordinary shareholders. However, from a legal perspective, they are capital stock and therefore may entitle holders to some degree of control depending on whether they contain voting rights.


Convertibles are bonds or preferred stock that can be converted, at the election of the holder of the convertibles, into the common stock of the issuing company. The convertibility, however, may be forced if the convertible is a callable bond, and the issuer calls the bond. The bondholder has about 1 month to convert it, or the company will call the bond by giving the holder the call price, which may be less than the value of the converted stock. This is referred to as a forced conversion.


Equity warrants are options issued by the company that allow the holder of the warrant to purchase a specific number of shares at a specified price within a specified time. They are often issued together with bonds or existing equities, and are, sometimes, detachable from them and separately tradable. When the holder of the warrant exercises it, he pays the money directly to the company, and the company issues new shares to the holder.


Warrants, like other convertible securities, increases the number of shares outstanding, and are always accounted for in financial reports as fully diluted earnings per share, which assumes that all warrants and convertibles will be exercised.



The securities markets  证券市场

Primary and secondary market  初级与二级市场

Public securities markets are either primary or secondary markets. In the primary market, the money for the securities is received by the issuer of the securities from investors, typically in an initial public offering (IPO). In the secondary market, the securities are simply assets held by one investor selling them to another investor, with the money going from one investor to the other.


An initial public offering is when a company issues public stock newly to investors, called an “IPO” for short. A company can later issue more new shares, or issue shares that have been previously registered in a shelf registration. These later new issues are also sold in the primary market, but they are not considered to be an IPO but are often called a “secondary offering”. Issuers usually retain investment banks to assist them in administering the IPO, obtaining SEC (or other regulatory body) approval of the offering filing, and selling the new issue. When the investment bank buys the entire new issue from the issuer at a discount to resell it at a mark-up, it is called a firm commitment underwriting. However, if the investment bank considers the risk too great for an underwriting, it may only assent to a best effort agreement, where the investment bank will simply do its best to sell the new issue.


For the primary market to thrive, there must be a secondary market, or aftermarket that provides liquidity for the investment security—where holders of securities can sell them to other investors for cash. Otherwise, few people would purchase primary issues, and, thus, companies and governments would be restricted in raising equity capital (money) for their operations. Organized exchanges constitute the main secondary markets. Many smaller issues and most debt securities trade in the decentralized, dealer-based over-the-counter markets.


In Europe, the principal trade organization for securities dealers is the International Capital Market Association. In the U.S., the principal trade organization for securities dealers is the Securities Industry and Financial Markets Association, which is the result of the merger of the Securities Industry Association and the Bond Market Association. The Financial Information Services Division of the Software and Information Industry Association (FISD/SIIA) represents a round-table of market data industry firms, referring to them as Consumers, Exchanges, and Vendors.In india the equivalent organisation is the securities exchange board of india(SEBI).


Public offer and private placement  公开招股与私募配售

In the primary markets, securities may be offered to the public in a public offer. Alternatively, they may be offered privately to a limited number of qualified persons in a private placement. Sometimes a combination of the two is used. The distinction between the two is important to securities regulation and company law. Privately placed securities are not publicly tradable and may only be bought and sold by sophisticated qualified investors. As a result, the secondary market is not nearly as liquid as it is for public (registered) securities.


Another category, sovereign bonds, is generally sold by auction to a specialized class of dealers.


Listing and OTC dealing  上市与场外交易

Securities are often listed in a stock exchange, an organized and officially recognized market on which securities can be bought and sold. Issuers may seek listings for their securities to attract investors, by ensuring there is a liquid and regulated market that investors can buy and sell securities in.


Growth in informal electronic trading systems has challenged the traditional business of stock exchanges. Large volumes of securities are also bought and sold “over the counter” (OTC). OTC dealing involves buyers and sellers dealing with each other by telephone or electronically on the basis of prices that are displayed electronically, usually by commercial information vendors such as SuperDerivatives, Reuters and Bloomberg.


There are also eurosecurities, which are securities that are issued outside their domestic market into more than one jurisdiction. They are generally listed on the Luxembourg Stock Exchange or admitted to listing in London. The reasons for listing eurobonds include regulatory and tax considerations, as well as the investment restrictions.


Market  市场

London is the centre of the eurosecurities markets. There was a huge rise in the eurosecurities market in London in the early 1980s. Settlement of trades in eurosecurities is currently effected through two European computerized clearing/depositories called Euroclear (in Belgium) and Clearstream (formerly Cedelbank) in Luxembourg.


The main market for Eurobonds is the EuroMTS, owned by Borsa Italiana and Euronext. There are ramp up market in Emergent countries, but it is growing slowly.

欧洲债券的主要市场是米兰股票交易所(Borsa Italiana)和泛欧交易所(Euronext)拥有的欧洲做股(预估供股应市)(EuroMTS),这是一个新兴国家的爬升市场,但成长速度缓慢。


Physical nature of securities  证券的实体本质

Certificated securities  凭证证券

Securities that are represented in paper (physical) form are called certificated securities. They may be bearer or registered.


DRS securities  直接登记系统(DRS)证券

Securities may also be held in the Direct Registration System (DRS), which is a method of recording shares of stock in book-entry form. Book-entry means the company’s transfer agent maintains the shares on the owner’s behalf without the need for physical share certificates. Shares held in un-certificated book-entry form have the same rights and privileges as shares held in certificated form.


Bearer securities  不记名证券

Bearer securities are completely negotiable and entitle the holder to the rights under the security (e.g. to payment if it is a debt security, and voting if it is an equity security). They are transferred by delivering the instrument from person to person. In some cases, transfer is by endorsement, or signing the back of the instrument, and delivery.


Regulatory and fiscal authorities sometimes regard bearer securities negatively, as they may be used to facilitate the evasion of regulatory restrictions and tax. In the United Kingdom, for example, the issue of bearer securities was heavily restricted firstly by the Exchange Control Act 1947 until 1953. Bearer securities are very rare in the United States because of the negative tax implications they may have to the issuer and holder.


Registered securities  记名证券

In the case of registered securities, certificates bearing the name of the holder are issued, but these merely represent the securities. A person does not automatically acquire legal ownership by having possession of the certificate. Instead, the issuer (or its appointed agent) maintains a register in which details of the holder of the securities are entered and updated as appropriate. A transfer of registered securities is effected by amending the register.


Non-certificated securities and global certificates  无凭证证券与全球通用凭证

Modern practice has developed to eliminate both the need for certificates and maintenance of a complete security register by the issuer. There are two general ways this has been accomplished.


Non-certificated securities  无凭证证券

In some jurisdictions, such as France, it is possible for issuers of that jurisdiction to maintain a legal record of their securities electronically.


In the United States, the current “official” version of Article 8 of the Uniform Commercial Code permits non-certificated securities. However, the “official” UCC is a mere draft that must be enacted individually by each U.S. state. Though all 50 states (as well as the District of Columbia and the U.S. Virgin Islands) have enacted some form of Article 8, many of them still appear to use older versions of Article 8, including some that did not permit non-certificated securities.


Global certificates, book entry interests, depositories  全球通用凭证,帐面纪录利益,存管处

To facilitate the electronic transfer of interests in securities without dealing with inconsistent versions of Article 8, a system has developed whereby issuers deposit a single global certificate representing all the outstanding securities of a class or series with a universal depository. This depository is called The Depository Trust Company, or DTC. DTC’s parent, Depository Trust & Clearing Corporation (DTCC), is a non-profit cooperative owned by approximately thirty of the largest Wall Street players that typically act as brokers or dealers in securities. These thirty banks are called the DTC participants. DTC, through a legal nominee, owns each of the global securities on behalf of all the DTC participants.


All securities traded through DTC are in fact held, in electronic form, on the books of various intermediaries between the ultimate owner, e.g. a retail investor, and the DTC participants. For example, Mr. Smith may hold 100 shares of Coca Cola, Inc. in his brokerage account at local broker Jones & Co. brokers. In turn, Jones & Co. may hold 1000 shares of Coca Cola on behalf of Mr. Smith and nine other customers. These 1000 shares are held by Jones & Co. in an account with Goldman Sachs, a DTC participant, or in an account at another DTC participant. Goldman Sachs in turn may hold millions of Coca Cola shares on its books on behalf of hundreds of brokers similar to Jones & Co. Each day, the DTC participants settle their accounts with the other DTC participants and adjust the number of shares held on their books for the benefit of customers like Jones & Co. Ownership of securities in this fashion is called beneficial ownership. Each intermediary holds on behalf of someone beneath him in the chain. The ultimate owner is called the beneficial owner. This is also referred to as owning in “Street name”.


Among brokerages and mutual fund companies, a large amount of mutual fund share transactions take place among intermediaries as opposed to shares being sold and redeemed directly with the transfer agent of the fund. Most of these intermediaries such as brokerage firms clear the shares electronically through the National Securities Clearing Corp. or “NSCC”, a subsidiary of DTCC.


Other depositories: Euroclear and Clearstream  其他存管处:欧洲结算系统与结算流

Besides DTC, two other large securities depositories exist, both in Europe: Euroclear and Clearstream.


Divided and undivided security  已分与未分证券

The terms “divided” and “undivided” relate to the proprietary nature of a security.


Each divided security constitutes a separate asset, which is legally distinct from each other security in the same issue. Pre-electronic bearer securities were divided. Each instrument constitutes the separate covenant of the issuer and is a separate debt.


With undivided securities, the entire issue makes up one single asset, with each of the securities being a fractional part of this undivided whole. Shares in the secondary markets are always undivided. The issuer owes only one set of obligations to shareholders under its memorandum, articles of association and company law. A share represents an undivided fractional part of the issuing company. Registered debt securities also have this undivided nature.


Fungible and non-fungible security  可互换与不可互换证券

The terms “fungible” and “non-fungible” are a feature of assets.


If an asset is fungible, this means that if such an asset is lent, or placed with a custodian, it is customary for the borrower or custodian to be obliged at the end of the loan or custody arrangement to return assets equivalent to the original asset, rather than the specific identical asset. In other words, the redelivery of fungibles is equivalent and not in specie. In other words, if an owner of 100 shares of IBM transfers custody of those shares to another party to hold for a purpose, at the end of the arrangement, the holder need simply provide the owner with 100 shares of IBM identical to those received. Cash is also an example of a fungible asset. The exact currency notes received need not be segregated and returned to the owner.


Undivided securities are always fungible by logical necessity. Divided securities may or may not be fungible, depending on market practice. The clear trend is towards fungible arrangements.



Regulation  監管

In the US, the public offer and sale of securities must be either registered pursuant to a registration statement that is filed with the U.S. Securities and Exchange Commission (SEC) or are offered and sold pursuant to an exemption therefrom. Dealing in securities is regulated by both federal authorities (SEC) and state securities departments. In addition, the brokerage industry is supposedly self policed by Self Regulatory Organizations (SROs), such as the Financial Industry Regulatory Authority (FINRA), formerly the National Association of Securities Dealers (or NASD) or the MSRB.


With respect to investment schemes that do not fall within the traditional categories of securities listed in the definition of a security (Sec. 2(a)(1) of the 33 act and Sec. 3(a)(10) of the 34 act) the US Courts have developed a broad definition for securities that must then be registered with the SEC. When determining if there is an “investment contract” that must be registered the courts look for an investment of money, a common enterprise and expectation of profits to come primarily from the efforts of others. See SEC v. W.J. Howey Co. and SEC v. Turner.”



See also  参阅

  • Commercial Law  商业法
  • Finance  财务 / 融资
  • Financial markets  金融市场
  • Financial regulation  金融监管
  • History of private equity and venture capital  私募股本与创业资金的历史
  • List of finance topics  财务主题列表
  • Securities lending  证券借贷
  • Securities regulation in the United States  美国的证券监管
  • Settlement (finance)  结算 (财务)
  • Single-stock futures  个股期货
  • Stock market data systems  股票市场数据系统
  • T2S  双目标证券 (泛欧证券结算系统)
  • Toxic security  有毒证券 (套牢必亏卖不出)
  • Trading account assets  交易账户资产



The United States Securities Exchange Act of 1934 defines a security as: “Any note, stock, treasury stock, bond, debenture, certificate of interest or participation in any profit-sharing agreement or in any oil, gas, or other mineral royalty or lease, any collateral trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit, for a security, any put, call, straddle, option, or group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency, or in general, any instrument commonly known as a “security”; or any certificate of interest or participation in, temporary or interim certificate for, receipt for, or warrant or right to subscribe to or purchase, any of the foregoing; but shall not include currency or any note, draft, bill of exchange, or banker’s acceptance which has a maturity at the time of issuance of not exceeding nine months, exclusive of days of grace, or any renewal thereof the maturity of which is likewise limited.”



Glossaries  术语录

Financial markets  金融市場

Public market  公開市場

  • Exchange  交易所
  • Securities  證券

Bond market  債券市場

  • Bond valuation  債券股價
  • Corporate bond  企業債券
  • Fixed income  固定收益
  • Government bond  政府債券
  • High-yield debt  高收益債券
  • Municipal bond  市府債券

Stock market  股票市場

  • Common stock  普通股
  • Preferred stock  優先股
  • Registered share  記名股票
  • Stock  股票
  • Stock certificate  股票證書
  • Stock exchange  股票交易所
  • Voting share   投票份額

Derivatives market  衍生品市場

  • Credit derivative  信貸衍生品
  • Futures exchange  期貨交易所
  • Hybrid security  混合證券
  • Securitization  證券化

Over-the-counter  場外

  • Forwards  遠期
  • Options  期權
  • Spot market  現貨市場
  • Swaps  掉期

Foreign exchange  外匯

  • Currency  貨幣
  • Exchange rate  匯率

Other markets  其他市場

  • Commodity market  商品市場
  • Money market  貨幣市場
  • Reinsurance market  再保市場
  • Real estate market  房地產市場

Practical trading  實際買賣

  • Clearing house  結算所
  • Financial market participants  金融市場參與者
  • Financial regulation  金融監管條例

Finance series  金融系列

  • Banks and banking  銀行與銀行事務
  • Corporate finance  企業融資
  • Personal finance 個人理財
  • Public finance  公共財政

—— END ——


Source > Wikipedia at

Translated by > BlogHost — hkTan

Word Count > approx.4380 words in English


Closed-end Fund 封闭式基金

August 15, 2012 1 comment

Closed-end Fund  封 闭 式 基 金


Closed-end funds (or closed-ended funds) are mutual funds with a fixed number of shares (or units). Unlike open-end funds, new shares/units in a closed-end fund are not created by managers to meet demand from investors. Instead, the shares can only be purchased (and sold) in the market. This is the original design of mutual fund which predates open-end mutual funds but offers the same actively managed pooled investments.


Closed-end funds are usually listed on a recognised stock exchange and can be bought and sold on that exchange. The price per share is determined by the market and is usually different from the underlying value or net asset value (NAV) per share of the investments held by the fund. The price is said to be at a discount or premium to the NAV when it is below or above the NAV, respectively.


A premium might be due to the market’s confidence in the investment managers’ ability to produce above-market returns. A discount might reflect the charges to be deducted from the fund in future by the managers.


In the United States, closed-end funds are referred to under the law as closed-end companies and they form one of four SEC recognized types of investment companies along with mutual funds, exchange-traded funds, and unit investment trusts. Other examples of closed-ended funds are investment trusts in the United Kingdom and listed investment companies in Australia.



Contents  目录

1. Availability  现有

2. Distinguishing features  显著特色

3. Initial offering  首次招售

4. Exchange-traded  交易所买卖

5. Discounts and premiums  折价与溢价

6. Comparison with open-ended funds  与开放式基金比较

7. Examples  例子

8. See also  另见

9. External links 外部链接


Availability  现有

Closed end funds are typically traded on the major global stock exchanges. In the United States the New York Stock Exchange is dominant although the NASDAQ is in competition; in the United Kingdom the London Stock Exchange’s main market is home to the mainstream funds although AIM supports many small funds especially the Venture Capital Trusts; in Canada, the Toronto Stock Exchange lists many closed-end funds.


Like their better-known open-ended cousins, closed-end funds are usually sponsored by a fund management company which will control how the fund is invested. They begin by soliciting money from investors in an initial offering, which may be public or limited. The investors are given shares corresponding to their initial investment. The fund managers pool the money and purchase securities or other assets. What exactly the fund manager can invest in depends on the fund’s charter, prospectus and the applicable government regulations. Some funds invest in stocks, others in bonds, and some in very specific things (for instance, tax-exempt bonds issued by the state of Florida in the USA).



Distinguishing features  显著特色

Some characteristics that distinguish a closed-end fund from an ordinary open-end mutual fund are that:


  • it is closed to new capital after it begins operating, and
  • its shares (typically) trade on stock exchanges rather than being redeemed directly by the fund.
  • its shares can therefore be traded at any time during market opening hours. An open-end fund can usually be traded only at a time of day specified by the managers, and the dealing price will usually not be known in advance.
  • a CEF usually trades at a premium or discount to its Net Asset Value. An open-end fund trades at its Net Asset Value (to which sales charges may be added; and adjustments may be made for e.g. the frictional costs of purchasing or selling the underlying investments).
  • in the United States, a closed-end company can own unlisted securities.
  • 它在开始经营后,只限新资金投入;
  • 它的股票(通常都)在交易所买卖而不是直接由该基金赎回;
  • 它的股票随时都可以在交易开放时间内买卖,而开放式基金通常都只能在经理人指定的日子和时间内交易,而且交易价也都会提前通知;
  • 封闭式基金(CEF)通常都会以“资产净值”的溢价或折价买卖,而开放式基金则是以“资产净值”作交易(附销售费和其他计量如买或卖相关投资的交易成本);
  • 在美国,封闭式公司可以拥有不挂牌的证券。

Another distinguishing feature of a closed-end fund is the common use of leverage or gearing to enhance returns. CEFs can raise additional investment capital by issuing auction rate securities, preferred stock, long-term debt, and/or reverse-repurchase agreements. In doing so, the fund manager hopes to earn a higher return with this excess invested capital.


When a fund leverages through the issuance of preferred stock, two types of shareholders are created: preferred stock shareholders and common stock shareholders.


Preferred stock shareholders benefit from expenses based on the total managed assets of the fund. Total managed assets include both the assets attributable to the purchase of stock by common shareholders and those attributable to the purchase of stock by preferred shareholders.


The expenses charged to the common shareholders are based on the common assets of the fund, rather than the total managed assets of the fund. The common shareholders’ returns are reduced more significantly than those of the preferred shareholders because the expenses are spread among a smaller asset base.


For the most part, closed-end fund companies report expense ratios based on the fund’s common assets only. However, the contractual management fees charged to the closed-end funds may be based on the common asset base or the total managed asset base.


Long-term debt arrangements and reverse repurchase agreements are two additional ways to raise additional capital for the fund. Funds may use a combination of leveraging tactics or each individually. However, it is more common for the fund to use only one leveraging technique.


Since stock in closed-end funds is traded like other stock, an investor trading them will pay a brokerage commission similar to that paid when trading other stocks (as opposed to commissions on open-ended mutual funds, where the commission will vary based on the share class chosen and the method of purchasing the fund). In other words, closed-end funds typically do not have sales-based share classes with different commission rates and annual fees. The main exception is loan-participation funds.



Initial offering  首次招售

Like a company going public, a closed-end fund will have an initial public offering of its shares at which it will sell, say, 10 million shares for $10 each. That will raise $100 million for the fund manager to invest. At that point, the fund’s 10 million shares will begin to trade on a secondary market, typically the NYSE or the AMEX for American closed-end funds. Any investor who subsequently wishes to buy or sell fund shares will do so on the secondary market. In normal circumstances, closed-end funds do not redeem their own shares. Nor, typically, do they sell more shares after the IPO (although they may issue preferred stock, in essence taking out a loan secured by the portfolio).



Exchange-traded  交易所买卖

Closed-end fund shares are traded throughout market opening hours at whatever price the market will support. It may be possible to deal using advanced types of orders such as limit orders and stop orders. This is in contrast to some open-end funds which are only available for buying and selling at the close of business each day, at the calculated NAV, and for which orders must be placed in advance, before the NAV is known, and by simple buy or sell orders. Some funds require that orders be placed hours or days in advance, in order to simplify their administration, make it easier to match buyers with sellers, and eliminate the possibility of arbitrage (for example if the fund holds investments which are traded in other time zones).


Closed-end funds are traded on exchanges and in that respect they are like exchange-traded funds (ETFs), but there are important differences between these two kinds of security. The price of a closed-end fund is completely determined by the valuation of the market, and this price often diverges substantially from the NAV of the fund assets. In contrast, the market price of an ETF trades in a narrow range very close to its net asset value, because the structure of ETFs allows major market participants to redeem shares of an ETF for a “basket” of the fund’s underlying assets. This feature could in theory lead to potential arbitrage profits if the market price of the ETF were to diverge substantially from its NAV. The market prices of closed-end funds are often 10% to 20% higher or lower than their NAV, while the market price of an ETF is typically within 1% of its NAV. Since the market downturn of late 2008 a number of fixed income ETFs have traded at premiums of roughly 2% to 3% above their NAV.



Discounts and premiums  折价与溢价

As they are exchange-traded, the price of CEFs will be different from the NAV – an effect known as the closed-end fund puzzle. In particular, fund shares often trade at what look to be irrational prices because secondary market prices are often very much out of line with underlying portfolio values. A CEF can trade at a premium at some times, and a discount at other times. For example, Morgan Stanley Eastern Europe Fund (RNE) on the NYSE was trading at a premium of 39% in May 2006 and at a discount of 6% in October 2006. These huge swings are difficult to explain.


US and other closed-end stock funds often have share prices that are 5% or more below the NAV. That is, if a fund has 10 million shares outstanding and its portfolio is worth $200 million, then each share represents a claim on assets worth $20 and you might expect that the market price of the fund’s shares on the secondary market would be around $20 but that is typically not the case. The shares may trade for only $19 or even only $17, i.e., a 5% or 15% discount to NAV.


The existence of discounts is puzzling since if a fund is trading at a discount, and if permitted by the rules or constitution of the fund, theoretically a well-capitalized investor could come along and buy up enough of the fund’s shares at the discounted price to gain control of the company and force the fund managers to liquidate the portfolio at its (higher) market value (although in reality, liquidity issues may make this difficult since the bid–offer spread will drastically widen as fewer and fewer shares are available in the market). Benjamin Graham claimed that an investor can hardly go wrong by buying such a fund with a 15% discount. However, the opposing view is that the fund may not liquidate in your timeframe and you may be forced to sell at an even worse discount; in any case, in the meantime the fund will have incurred costs and charges imposed by the managers. But like any investment, these discounts could simply represent the assessment of the marketplace that the investments in the fund may lose value.

折扣的现象让人摸不着头脑,既然基金是以折价交易,如果是基金的规则和宪章允准的,理论上一名资金雄厚的投资者可以入场用折扣价买下大量的基金股票取得公司的控制权,然后强迫基金经理人以(原本更高的)市值去变现整个投资组合(实际上,套现的问题让这个行动变得困难,因为买卖差价会大幅度地扩大差距,导致市场上的股票越来越少) 。Benjamin Graham认为,用15%折价买入这种基金的投资者很难出错,然而,相对的观点是,这个基金不一定能在你的时间表里变现,你可能会被迫以更低的折价脱售;无论如何,眼前这个基金已经累积出经理人附加的成本与费用。正如其他任何投资,这些折扣只是简单地反映出市场的评估,告诉你这个基金的投资可能会贬值。

Even stranger, funds very often trade at a substantial premium to NAV. Some of these premiums are extreme, with premiums of several hundred percent having been seen on occasion. Why anyone would pay $30 per share for a fund whose portfolio value per share is only $10 is not well understood, although irrational exuberance has been mentioned. One theory is that if the fund has a strong track record of performance, investors may speculate that the out-performance is due to good investment choices by the fund managers and that the fund managers will continue to make good choices in the future. Thus the premium represents the ability to instantly participate in the fruits of the fund manager’s decisions.


A great deal of academic ink has been spent trying to explain why closed-end fund share prices are not forced by arbitrageurs to be equal to underlying portfolio values. Though there are many strong opinions, the jury is still out. It is easier to understand in cases where the CEF is able to pick and choose assets, and arbitrageurs are not able to access information on the specific assets held until months later, but some funds are forced to replicate a specific index and still trade at a discount.



Comparison with open-ended funds  与开放式基金比较

With open-end funds, the value is precisely equal to the NAV. So investing $1000 into the fund means buying shares that lay claim to $1000 worth of underlying assets (apart from sales charges and the fund’s investment costs). But buying a closed-end fund trading at a premium might mean buying $900 worth of assets for $1000.


Some advantages of closed-end funds over their open-ended cousins are financial. CEFs do not have to deal with the expense of creating and redeeming shares, they tend to keep less cash in their portfolio, and they need not worry about market fluctuations to maintain their “performance record”. So if a stock drops irrationally, the closed-end fund may snap up a bargain, while open-ended funds might sell too early.


Also, if there is a market panic, investors may sell en masse. Faced with a wave of sell orders and needing to raise money for redemptions, the manager of an open-ended fund may be forced to sell stocks he would rather keep, and keep stocks he would rather sell, because of liquidity concerns (selling too much of any one stock causes the price to drop disproportionately). Thus it may become overweight in the shares of lower perceived quality or underperforming companies for which there is little demand. But an investor pulling out of a closed-end fund must sell it on the market to another buyer, so the manager need not sell any of the underlying stock. The CEF’s price will likely drop more than the market does (severely punishing those who sell during the panic), but it is more likely to make a recovery when the intrinsically sound stocks rebound.


Because a closed-end fund is listed on the market, it must obey certain rules, such as filing reports with the listing authority and holding annual stockholder meetings. Thus stockholders can more easily find out about their fund and engage in shareholder activism, such as protest against poor management.



Examples  例子

Among the biggest, long-running CEFs are:


  • Adams Express Company (NYSE:ADX)
  • 亚当斯速递公司 (纽约证券交易所:代号为ADX)
  • Foreign & Colonial Investment Trust plc (LSE:FRCL)
  • 国外与殖民投资信托公司 (伦敦证券交易所:代号为FRCL)
  • Witan Investment Trust plc (LSE:WTAN)
  • Witan投资信托公司 (伦敦证券交易所:代号为WTAN)
  • Scottish Mortgage Investment Trust (LSE:SMT)
  • 苏格兰抵押贷款投资信托 (伦敦证券交易所:代号为SMT)
  • Tri-Continental Corporation (NYSE:TY)
  • 三大陆企业 (纽约证券交易所:代号为TY)
  • Gabelli Equity Trust (NYSE:GAB)
  • Gabelli股权信托 (纽约证券交易所:代号为GAB)
  • General American Investors Company, Inc. (NYSE:GAM)
  • 大众美国人投资者公司 (纽约证券交易所:代号为GAM)


See also  另见

  • Collective investment schemes for generic information.
  • 集体投资方案的通用信息
  • Investment trust a United Kingdom closed-ended collective investment.
  • 投资信托—大英王国的封闭式集体投资
  • Mutual funds for United States information.
  • 美国共同基金的信息
  • Listed investment companies for Australia.
  • 澳大利亚的上市投资公司


External Links  外部链接

Investment management  投资管理

Collective investment scheme structures  集体投资方案的结构

  • Common contractual fund  共同合约基金
  • Fond commun de placement  (法国) 共同基金
  • Investment trust  投资信托
  • Unit trust  单位信托
  • Listed investment company 上市投资公司
  • Mutual fund  共同基金 / 互助基金
  • Open-ended investment company  开放式投资公司
  • SICAV  (西班牙/法国/意大利) 可变/不定额 资金投资公司
  • Real estate investment trust  房地产投资信托
  • Unit investment trust  单位投资信托
  • Exchange-traded fund  交易所买卖基金
  • Offshore fund  离岸基金 / 境外基金
  • Unitised insurance fund  单位化保险基金

Investment styles  投资式样

  • Active or Passive management  积极或消极管理
  • Value or Growth investing  价值或增长投资
  • Hedge fund  对冲基金
  • Socially responsible investing  社会道义投资 (对社会负责任的投资)
  • Impact investing  冲击投资 (有影响投资)
  • Fund of funds  基金中基金 (投资在基金的基金)
  • Manager of managers  经理的经理
  • Index fund  指数基金

Theory and terminology  理论与术语

  • Efficient-market hypothesis  有效市场假说
  • Net asset value  资产净值
  • Open-end fund  开放式基金
  • Closed-end fund  封闭式基金

Related topics  相关话题

  • List of asset management firms  资产管理公司的名单
  • Returns-based style analysis  以回报为本的分析方式
  • Umbrella fund  伞子基金
  • UCITS  可转让证券集体投资事业


—— END ——


Source > Wikipedia at

Translated by > BlogHost — hkTan

Word Count > approx. 2444 words in English


Categories: Financial:金融 Tags:

Financial Market 金融市場

August 1, 2012 Leave a comment

Financial Market  金 融 市 場


A financial market is a market in which people and entities can trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand. Securities include stocks and bonds, and commodities include precious metals or agricultural goods.


There are both general markets (where many commodities are traded) and specialized markets (where only one commodity is traded). Markets work by placing many interested buyers and sellers, including households, firms, and government agencies, in one “place”, thus making it easier for them to find each other. An economy which relies primarily on interactions between buyers and sellers to allocate resources is known as a market economy in contrast either to a command economy or to a non-market economy such as a gift economy.


In finance, financial markets facilitate: 財經方面,金融市場促進了:

  • The raising of capital (in the capital markets)
  • The transfer of risk (in the derivatives markets)
  • Price discovery
  • Global transactions with integration of financial markets
  • The transfer of liquidity (in the money markets)
  • International trade (in the currency markets)
  • (在資本市場中) 資金的籌集
  • (在衍生市場中) 風險的轉移
  • 價格的回穩
  • 金融市場一體化的全球交易
  • (在貨幣市場中) 流通性的轉移
  • (在外匯市場中) 國際貿易

– and are used to match those who want capital to those who have it.


Typically a borrower issues a receipt to the lender promising to pay back the capital. These receipts are securities which may be freely bought or sold. In return for lending money to the borrower, the lender will expect some compensation in the form of interest or dividends. This return on investment is a necessary part of markets to ensure that funds are supplied to them.



Contents  目錄

1. Definition  定義

2. Types of financial markets  金融市場的類別

3. Raising capital 籌資

3.1 Lenders  貸款人

3.1.1 Individuals & Doubles  個人與多人

3.1.2 Companies 公司

3.2 Borrowers  借款人

4. Derivative products  衍生商品

5. Currency markets  貨幣市場

6. Analysis of financial markets  金融市場的分析

7. Financial market slang  金融市場的行話

8. Role (Financial system and the economy)  角色 (金融體系與經濟)

9. Functions of Financial Markets  金融市場的功能

10 Constituents of Financial Market  金融市場的組成

10.1 Based on market levels  以市場層次劃分

10.2 Based on security types  以證券種類劃分

11 See also  另見

12 External links  外部鏈接


Definition  定義

In economics, typically, the term market means the aggregate of possible buyers and sellers of a certain good or service and the transactions between them.


The term “market” is sometimes used for what are more strictly exchanges, organizations that facilitate the trade in financial securities, e.g., a stock exchange or commodity exchange. This may be a physical location (like the NYSE, BSE, NSE) or an electronic system (like NASDAQ). Much trading of stocks takes place on an exchange; still, corporate actions (merger, spinoff) are outside an exchange, while any two companies or people, for whatever reason, may agree to sell stock from the one to the other without using an exchange.


Trading of currencies and bonds is largely on a bilateral basis, although some bonds trade on a stock exchange, and people are building electronic systems for these as well, similar to stock exchanges.


Financial markets can be domestic or they can be international.



Types of financial markets  金融市場的類別

Within the financial sector, the term “financial markets” is often used to refer just to the markets that are used to raise finance: for long term finance, the Capital markets; for short term finance, the Money markets. Another common use of the term is as a catchall for all the markets in the financial sector, as per examples in the breakdown below.


Capital markets which consist of: 資本市場中有:

  • Stock markets, which provide financing through the issuance of shares or common stock, and enable the subsequent trading thereof.
  • Bond markets, which provide financing through the issuance of bonds, and enable the subsequent trading thereof.
  • Commodity markets, which facilitate the trading of commodities.
  • Money markets, which provide short term debt financing and investment.
  • Derivatives markets, which provide instruments for the management of financial risk.
  • Futures markets, which provide standardized forward contracts for trading products at some future date; see also forward market.
  • Insurance markets, which facilitate the redistribution of various risks.
  • Foreign exchange markets, which facilitate the trading of foreign exchange.
  • 股票市場:發行股份或普通股來提供融資,接著進行交易。
  • 債券市場:發行債券以提供融資,接著進行交易。
  • 商品市場:促進商品的買賣。
  • 貨幣市場:提供短期債務融資與投資機會。
  • 衍生市場:提供管理金融風險的工具。
  • 期貨市場:為那些以未來日期買賣的產品提供標準的遠期合同;另見“遠期市場”。
  • 保險市場:促進各種風險的再分配。
  • 外匯市場:促進外幣的買賣。

The capital markets may also be divided into primary markets and secondary markets. Newly formed (issued) securities are bought or sold in primary markets, such as during initial public offerings. Secondary markets allow investors to buy and sell existing securities. The transactions in primary markets exist between issuers and investors, while in secondary market transactions exist among investors.


Liquidity is a crucial aspect of securities that are traded in secondary markets. Liquidity refers to the ease with which a security can be sold without a loss of value. Securities with an active secondary market mean that there are many buyers and sellers at a given point in time. Investors benefit from liquid securities because they can sell their assets whenever they want; an illiquid security may force the seller to get rid of their asset at a large discount.


The financial market is broadly divided into 2 types: 1) Capital Market and 2) Money market. The Capital market is subdivided into 1) primary market and 2) Secondary market.








Raising capital  籌資

Financial markets attract funds from investors and channel them to corporations—they thus allow corporations to finance their operations and achieve growth. Money markets allow firms to borrow funds on a short term basis, while capital markets allow corporations to gain long-term funding to support expansion.


Without financial markets, borrowers would have difficulty finding lenders themselves. Intermediaries such as banks, Investment Banks, and Boutique Investment Banks can help in this process. Banks take deposits from those who have money to save. They can then lend money from this pool of deposited money to those who seek to borrow. Banks popularly lend money in the form of loans and mortgages.


More complex transactions than a simple bank deposit require markets where lenders and their agents can meet borrowers and their agents, and where existing borrowing or lending commitments can be sold on to other parties. A good example of a financial market is a stock exchange. A company can raise money by selling shares to investors and its existing shares can be bought or sold.


The following table illustrates where financial markets fit in the relationship between lenders and borrowers:

Relationship between lenders and borrowers

Lenders Financial Intermediaries Financial Markets Borrowers



Insurance Companies

Pension Funds

Mutual Funds



Stock Exchange

Money Market

Bond Market

Foreign Exchange



Central Government


Public Corporations



貸款人 金融中介 金融市場 借款人

















Lenders  貸款人

Who have enough money to lend or to give someone money from own pocket at the condition of getting back the principal amount or with some interest or charge, is the Lender.


Individuals & Doubles  個人或多人

Many individuals are not aware that they are lenders, but almost everybody does lend money in many ways. A person lends money when he or she:


  • puts money in a savings account at a bank;
  • contributes to a pension plan;
  • pays premiums to an insurance company;
  • invests in government bonds; or
  • invests in company shares.
  • 把錢存入銀行的儲蓄帳戶裡;
  • 付錢給養老金計劃;
  • 支付保費給保險公司;
  • 投資在政府債券;或者
  • 投資買公司股票。

Companies  公司

Companies tend to be borrowers of capital. When companies have surplus cash that is not needed for a short period of time, they may seek to make money from their cash surplus by lending it via short term markets called money markets.


There are a few companies that have very strong cash flows. These companies tend to be lenders rather than borrowers. Such companies may decide to return cash to surplus (e.g. via a share buyback.) Alternatively, they may seek to make more money on their cash by lending it (e.g. investing in bonds and stocks).



Borrowers  借款人

  • Individuals borrow money via bankers’ loans for short term needs or longer term mortgages to help finance a house purchase.
  • Companies borrow money to aid short term or long term cash flows. They also borrow to fund modernization or future business expansion.
  • Governments often find their spending requirements exceed their tax revenues. To make up this difference, they need to borrow. Governments also borrow on behalf of nationalized industries, municipalities, local authorities and other public sector bodies. In the UK, the total borrowing requirement is often referred to as the Public sector net cash requirement (PSNCR).
  • 個人向銀行借錢應付短期需要或者長期抵押貸款去買房子。
  • 公司借錢來應付短期或長期的現金流,也借錢來支付現代化或未來的業務擴展所需。
  • 政府的開支需求通常都會超過稅收,爲了補缺,就需要借錢。政府也代替國有工業,市政府,當地政府部門和其他公共機構借錢。在英國,全部借款的要求通稱為公共部門凈現金需求(PSNCR)。

Governments borrow by issuing bonds. In the UK, the government also borrows from individuals by offering bank accounts and Premium Bonds. Government debt seems to be permanent. Indeed the debt seemingly expands rather than being paid off. One strategy used by governments to reduce the value of the debt is to influence inflation.


Municipalities and local authorities may borrow in their own name as well as receiving funding from national governments. In the UK, this would cover an authority like Hampshire County Council.


Public Corporations typically include nationalized industries. These may include the postal services, railway companies and utility companies.


Many borrowers have difficulty raising money locally. They need to borrow internationally with the aid of Foreign exchange markets.


Borrowers having similar needs can form into a group of borrowers. They can also take an organizational form like Mutual Funds. They can provide mortgage on weight basis. The main advantage is that this lowers the cost of their borrowings.



Derivative products  衍生商品

During the 1980s and 1990s, a major growth sector in financial markets is the trade in so called derivative products, or derivatives for short.


In the financial markets, stock prices, bond prices, currency rates, interest rates and dividends go up and down, creating risk. Derivative products are financial products which are used to control risk or paradoxically exploit risk. It is also called financial economics.


Derivative products or instruments help the issuers to gain an unusual profit from issuing the instruments. For using the help of these products a contract has to be made. Derivative contracts are mainly 3 types:


1. Future Contracts  期貨合約

2. Forward Contracts  遠期合約

3. Option Contracts  期權合約


Currency markets  貨幣市場

Seemingly, the most obvious buyers and sellers of currency are importers and exporters of goods. While this may have been true in the distant past, when international trade created the demand for currency markets, importers and exporters now represent only 1/32 of foreign exchange dealing, according to the Bank for International Settlements.


The picture of foreign currency transactions today shows:


  • Banks/Institutions  銀行 / 機構
  • Speculators  投機客
  • Government spending (for example, military bases abroad) 政府開支 (如海外軍事基地)
  • Importers/Exporters  出入口商
  • Tourists  遊客


Analysis of financial markets  金融市場的分析

Much effort has gone into the study of financial markets and how prices vary with time. Charles Dow, one of the founders of Dow Jones & Company and The Wall Street Journal, enunciated a set of ideas on the subject which are now called Dow Theory. This is the basis of the so-called technical analysis method of attempting to predict future changes. One of the tenets of “technical analysis” is that market trends give an indication of the future, at least in the short term. The claims of the technical analysts are disputed by many academics, who claim that the evidence points rather to the random walk hypothesis, which states that the next change is not correlated to the last change. In recent years the rise of algorithmic and high-frequency program trading has seen the adoption of momentum, ultra-short term moving average and other similar strategies which are based on technical as opposed to fundamental or theoretical concepts of market Behaviour.

很多人花很大精力在研究金融市場以及價格的變動。Charles Dows是道瓊斯公司以及華爾街日報的創辦人之一,他發表了同一個課題的一系列概念,現稱為道氏理論,成為所謂的技術分析法的基礎,嘗試預測未來的變化。“技術分析”的其中一個原理是市場趨勢會顯示未來,至少是短期內會出現的狀況。技術分析師們的主張也迎來許多學者的爭論,他們認為證據顯示出的反而是隨機漫步假說,也就是下一個轉變跟上一次變化沒關聯。近年來高頻程序交易的算法都採用以技術為本的動量,超短期移動平均數以及其他類似策略,相對於市場行為學的基本或理論概念。

The scale of changes in price over some unit of time is called the volatility. It was discovered by Benoît Mandelbrot that changes in prices do not follow a Gaussian distribution, but are rather modeled better by Lévy stable distributions. The scale of change, or volatility, depends on the length of the time unit to a power a bit more than 1/2. Large changes up or down are more likely than what one would calculate using a Gaussian distribution with an estimated standard deviation.

價格在某一些時間單位上的變動幅度就叫做波幅,Benoît Mandelbrot發現到價格的變動并沒有跟隨高斯分佈模式,而是符合模式較好的雷維穩定分佈法。改變的幅度或波幅取決於時間長度的0.5(二分之一)次方再稍微多一些,上或下的大變動比較有可能出現,使用高斯分佈模式那個估計標準偏差的算法就比較少見。


Financial market slang  金融市場的行話

Poison pill  毒藥 / 拼購阻撓

when a company issues more shares to prevent being bought out by another company, thereby increasing the number of outstanding shares to be bought by the hostile company making the bid to establish majority.


Quant  寬特 / 量化分析師 (數量化研究分析技術的分析師)

a quantitative analyst with a PhD (and above) level of training in mathematics and statistical methods.


Rocket scientist  火箭專家

a financial consultant at the zenith of mathematical and computer programming skill. They are able to invent derivatives of high complexity and construct sophisticated pricing models. They generally handle the most advanced computing techniques adopted by the financial markets since the early 1980s. Typically, they are physicists and engineers by training; rocket scientists do not necessarily build rockets for a living.


White Knight  白騎士

a friendly party in a takeover bid. Used to describe a party that buys the shares of one organization to help prevent against a hostile takeover of that organization by another party.


round-tripping  軋平

smurfing 化整為零(洗黑錢)

a deliberate structuring of payments or transactions to conceal it from regulators or other parties, a type of money laundering that is often illegal.


Spread  差價

the difference between the highest bid and the lowest offer.



Role (Financial system and the economy)  角色 (金融體系與經濟)

One of the important requisite for the accelerated development of an economy is the existence of a dynamic financial market. A financial market helps the economy in the following manner:


Saving mobilization  存款動員

Obtaining funds from the savers or surplus units such as household individuals, business firms, public sector units, central government, state governments etc. is an important role played by financial markets.


Investment  投資

Financial markets play a crucial role in arranging to invest funds thus collected in those units which are in need of the same.


National Growth  國家增長

An important role played by financial market is that, they contributed to a nation’s growth by ensuring unfettered flow of surplus funds to deficit units. Flow of funds for productive purposes is also made possible.


Entrepreneurship growth  企業成長

Financial market contribute to the development of the entrepreneurial claw by making available the necessary financial resources.


Industrial development  工業發展

The different components of financial markets help an accelerated growth of industrial and economic development of a country, thus contributing to raising the standard of living and the society of well-being.



Functions of Financial Markets  金融市場的功能

Intermediary Functions 中介功能

The intermediary functions of a financial markets include the following:


Transfer of Resources  資源的轉移

Financial markets facilitate the transfer of real economic resources from lenders to ultimate borrowers.


Enhancing income  提高收入

Financial markets allow lenders to earn interest or dividend on their surplus invisible funds, thus contributing to the enhancement of the individual and the national income.


Productive usage  有效應用

Financial markets allow for the productive use of the funds borrowed. The enhancing the income and the gross national production.


Capital Formation  資本組建

Financial markets provide a channel through which new savings flow to aid capital formation of a country.


Price determination  價格定位

Financial markets allow for the determination of price of the traded financial assets through the interaction of buyers and sellers. They provide a sign for the allocation of funds in the economy based on the demand and supply through the mechanism called price discovery process.


Sale Mechanism  銷售機制

Financial markets provide a mechanism for selling of a financial asset by an investor so as to offer the benefit of marketability and liquidity of such assets.


Information  信息

The activities of the participants in the financial market result in the generation and the consequent dissemination of information to the various segments of the market. So as to reduce the cost of transaction of financial assets.


Financial Functions  金融功能

  • Providing the borrower with funds so as to enable them to carry out their investment plans.
  • Providing the lenders with earning assets so as to enable them to earn wealth by deploying the assets in production debentures.
  • Providing liquidity in the market so as to facilitate trading of funds.
  • it provides liquidity to commercial bank
  • it facilitate credit creation
  • it promotes savings
  • it promotes investment
  • it facilitates balance economic growth
  • 為借款人提供資金好讓他們能開展投資計劃。
  • 為貸款人提供會賺錢的資產,好讓他們能把資產部署在有效益的債券證上去創造財富。
  • 在市場上提供流通性促進基金的交易。
  • 為商業銀行提供流通性。
  • 促進信貸的創建。
  • 推廣儲蓄。
  • 推廣投資。
  • 促進平衡的經濟增長。


Constituents of Financial Market  金融市場的組成

Based on market levels  以市場層次劃分

Primary market  初級市場

Primary market is a market for new issues or new financial claims. Hence it’s also called new issue market. The primary market deals with those securities which are issued to the public for the first time.


Secondary market  二級市場

It’s a market for secondary sale of securities. In other words, securities which have already passed through the new issue market are traded in this market. Generally, such securities are quoted in the stock exchange and it provides a continuous and regular market for buying and selling of securities.



Based on security types  以證券種類劃分

Money market  貨幣市場

Money market is a market for dealing with financial assets and securities which have a maturity period of up to one year. In other words, it’s a market for purely short term funds.


Capital market 資本市場

A capital market is a market for financial assets which have a long or indefinite maturity. Generally it deals with long term securities which have a maturity period of above one year. Capital market may be further divided in to: (a) industrial securities market (b) Govt. securities market and (c) long term loans market.

資本市場是金融資產的市場,履約期長或不定,通常都處理超過一年履約期的長期證券。資本市場可以再分為:(a)工業證券市場 (b)政府證券市場 (c)長期貸款市場。

Equity markets  股權市場

A market where ownership of securities are issued and subscribed is known as equity market. An example of a secondary equity market for shares is the Bombay stock exchange.

發行和認購證券權益的市場就叫做股權市場(或股本市場/股市,Share market:股票市場/股市),股票的二級股權市場如孟買證券交易所。

Debt market  債務市場

The market where funds are borrowed and lent is known as debt market. Arrangements are made in such a way that the borrowers agree to pay the lender the original amount of the loan plus some specified amount of interest.


Derivative markets  衍生品市場

Financial service market  金融服務市場

A market that comprises participants such as commercial banks that provide various financial services like ATM. Credit cards. Credit rating, stock broking etc. is known as financial service market. Individuals and firms use financial services markets, to purchase services that enhance the working of debt and equity markets.


Depository markets  存管市場

A depository market consist of depository institutions that accept deposit from individuals and firms and uses these funds to participate in the debt market, by giving loans or purchasing other debt instruments such as treasure bills.


Non-Depository market  非存管市場

Non-depository market carries out various functions in financial markets ranging from financial intermediary to selling, insurance etc. The various constituency in non-depositary markets are mutual funds, insurance companies, pension funds, brokerage firms etc.



See also  另見

  • Finance capitalism  金融資本主義
  • Financial crisis  金融危機
  • Financial instrument  金融工具
  • Financial market efficiency  金融市場效率
  • Brownian Model of Financial Markets  布朗模式的金融市場
  • Investment theory  投資理論
  • Quantitative behavioral finance  行為量化金融學
  • Slippage (finance)  滑脫 / 滑價 (金融)
  • Stock investor  股票投資者
  • Financial Market Theory of Development  金融市場發展的理論


Categories  分類

Financial markets  金融市場

Public market  公開市場

  • Exchange  交易所
  • Securities  證券

Bond market  債券市場

  • Bond valuation  債券股價
  • Corporate bond  企業債券
  • Fixed income  固定收益
  • Government bond  政府債券
  • High-yield debt  高收益債券
  • Municipal bond  市府債券

Stock market  股票市場

  • Common stock  普通股
  • Preferred stock  優先股
  • Registered share  記名股票
  • Stock  股票
  • Stock certificate  股票證書
  • Stock exchange  股票交易所
  • Voting share   投票份額

Derivatives market  衍生品市場

  • Credit derivative  信貸衍生品
  • Futures exchange  期貨交易所
  • Hybrid security  混合證券
  • Securitization  證券化

Over-the-counter  場外

  • Forwards  遠期
  • Options  期權
  • Spot market  現貨市場
  • Swaps  掉期

Foreign exchange  外匯

  • Currency  貨幣
  • Exchange rate  匯率

Other markets  其他市場

  • Commodity market  商品市場
  • Money market  貨幣市場
  • Reinsurance market  再保市場
  • Real estate market  房地產市場

Practical trading  實際買賣

  • Clearing house  結算所
  • Financial market participants  金融市場參與者
  • Financial regulation  金融監管

Finance series  金融系列

  • Banks and banking  銀行與銀行事務
  • Corporate finance  企業融資
  • Personal finance  個人理財
  • Public finance  公共財政


—— END ——


Source > Wikipedia at

Translated by > BlogHost — hkTan

Word Count > approx.3100 words in English


Categories: Financial:金融 Tags:


April 21, 2012 Leave a comment

Seigniorage 铸币税


Seigniorage (also spelled seignorage or seigneurage) can have the following two meanings:

铸币税-Seigniorage (也唸成seignorageseigneurage),可以有以下两种含义:

Seigniorage derived from specie—metal coins, is a tax, added to the total price of a coin (metal content and production costs), that a customer of the mint had to pay to the mint, and that was sent to the sovereign of the political area.


Seigniorage derived from notes is more indirect, being the difference between interest earned on securities acquired in exchange for bank notes and the costs of producing and distributing those notes.


Seigniorage is a convenient source of revenue for some governments.



Contents 目录

1 Examples  例子

1.1 Scenario A  案例A

1.2 Scenario B  案例B

2 Ordinary seigniorage  普通铸币税

2.1 Solvency constraints of central banks  央行的偿付能力局限

2.2 Seigniorage as a tax  铸币税的税收

3 Seigniorage today  现今的铸币税

3.1 2011 U.S. debt ceiling crisis  2011年美国债务上限的危机

4 Overseas circulation  海外流通

5 See also  另见

6 References  参考文献

7 External links  外部链接


Examples  例子

Scenario A  案例A

A person has one ounce of gold, trades it for a government-issued gold certificate (providing for redemption in one ounce of gold), keeps that certificate for a year, and then redeems it in gold. That person ends up with exactly one ounce of gold again. No seigniorage occurs.


Scenario B  案例B

Instead of issuing gold certificates, a government converts gold into currency at the market rate by printing paper notes. A person exchanges one ounce of gold for its value in currency. They keep the currency for one year, and then exchange it all for an amount of gold at the new market value. This second exchange may yield more or less than one ounce of gold if the value of the currency relative to gold has changed during the interim. (Assume that the value or direct purchasing power of one ounce of gold remains constant through the year.)


If the value of the currency relative to gold has decreased, then the person receives less than one ounce of gold. Seigniorage occurred.


If the value of the currency relative to gold has increased, the redeemer receives more than one ounce of gold. Seigniorage did not occur.


Seigniorage, therefore, is the positive return on issuing notes and coins, or “carry” on money in circulation.


The opposite, “cost of carry”, is not regarded as a form of seigniorage.



Ordinary seigniorage  普通铸币税

Ordinarily seigniorage is only an interest-free loan (for instance of gold) to the issuer of the coin or paper money. When the currency is worn out, the issuer buys it back at face value, thereby balancing exactly the revenue received when it was put into circulation, without any additional amount for the interest value of what the issuer received.


Historically, seigniorage was the profit resulting from producing coins. Silver and gold were mixed with base metals to make durable coins. Thus the British “sterling” was 92.5% pure silver; the base metal added (and thus the pure silver retained by the government mint) was (less costs) the profit, the seigniorage. USA gold coins were made from 90% gold, 7% silver, and 3% copper; one can easily see the seigniorage.


Currently, under the rules governing monetary operations of major central banks (including the central bank of the USA), seigniorage on bank notes is simply defined as the interest payments received by central banks on the total amount of currency issued. This usually takes the form of interest payments on treasury bonds purchased by central banks, putting more dollars into circulation. However, if the currency is collected, or is otherwise taken permanently out of circulation, the back end of the deal never occurs (that is, the currency is never returned to the central bank). Thus the issuer of the currency keeps the whole seigniorage profit, by not having to buy worn out issued currency back at face value.



Solvency constraints of central banks  央行的偿付能力局限

The solvency constraint of the standard central bank only requires that the present discounted value of its net non-monetary liabilities (separate from its monetary liabilities accrued through seigniorage attempts) be zero or negative in the long run. Its monetary liabilities are liabilities only in name, as they are irredeemable: the holder of base money cannot insist at any time on the redemption of a given amount of base money into anything else other than the same amount of itself (base money) — unless, of course, the holder of said base money is another central bank reclaiming the value of its original interest-free loan.



Seigniorage as a tax  铸币税的税收

Some economists regarded seigniorage as a form of inflation tax, redistributing real resources to the currency issuer. Issuing new currency, rather than collecting taxes paid out of the existing money stock, is then considered in effect a tax that falls on those who hold the existing currency. The expansion of the money supply may cause inflation in the long run.


This is one reason offered in support of free banking, a gold standard, or at a minimum the reduction of political control over central banks. The latter could then take as their primary objective ensuring a stable value of currency by controlling monetary expansion and thus limiting inflation. Independence from government is required to reach this aim – indeed, it is well known in economic literature that governments face a conflict of interest in this regard[citation needed]. In fact, “hard money” advocates argue that central banks have utterly failed to obtain the objective of a stable currency. Under the gold standard, for example, the price level in both England and the US remained relatively stable over literally hundreds of years, though with some protracted periods of deflation. Since the US Federal Reserve was formed in 1913, however, the US dollar has fallen to barely a twentieth of its former value through the consistently inflationary policies of the bank. Economists counter that deflation is hard to control once it sets in and its effects are much more damaging than modest, consistent inflation.


Banks or governments relying heavily on seigniorage and fractional reserve sources of revenue can find it counterproductive. Rational expectations of inflation take into account a bank’s seigniorage strategy, and inflationary expectations can maintain high inflation . Instead of accruing seigniorage from fiat money and credit most governments opt to raise revenue primarily through taxation and other means.



Seigniorage today  现今的铸币税

The “50 State” series of quarters (25-cent coins) was launched in the U.S. in 1999. The U.S. government planned on a large number of people collecting each new quarter as it rolled out of the U.S. Mint, thus taking the pieces out of circulation[citation needed]. Each set of quarters is worth $14.00 (a complete set includes quarters for all fifty states, the five U.S. territories, and the District of Columbia). Since it costs the Mint about five cents for each 25-cent piece it produces, the government made a profit whenever someone “bought” a coin and chose not to spend it. The U.S. Treasury estimates that it has earned about US$6.3 billion in seigniorage from the quarters over the course of the entire program.


In some cases, national mints report the amount of seigniorage provided to their respective governments; for example, the Royal Canadian Mint reported that in 2006 it generated $C93 million in seigniorage for the Government of Canada. The US government, the largest beneficiary of seignorage, earned approximately $25 billion annually as of 2000.

在某些情况下,国家铸币厂向各个政府报告提供的铸币税金额; 例如,加拿大皇家铸币厂在2006年向加拿大政府报告赚取了九千三百万加拿大币。美国政府这个铸币税的最大受益者每年赚取了大约250亿美元,截至2000年为止。

According to some reports, currently over half the revenue of the government of Robert Mugabe in Zimbabwe is in seigniorage. Zimbabwe has experienced hyperinflation (see Hyperinflation in Zimbabwe), with the annualized rate at about 24,000% in July 2008 (prices doubling every 46 days).



2011 U.S. debt ceiling crisis   2011年美国债务上限的危机

On 3 January 2011, a blogger suggested seigniorage as a solution to the 2011 U.S. debt ceiling crisis. This was covered on Slate online, on 29 July 2011 when it was suggested that a US$5 trillion coin could be minted and deposited with the Federal Reserve and used to buy back debt thus making funds available.



Overseas circulation  海外流通

A very profitable type of seignorage is from the international circulation of banknotes. While the cost of printing banknotes is minimal, the foreign entity must provide goods and services at the face value of the note to obtain it. The banknote is retained because the entity values it as a store of value because of mistrust of the local currency.


Overseas circulation is intimately tied in with large value banknotes. One purpose of using foreign currency is for store of value, but another is efficiency of private transactions many of which are illegal.


American currency has been circulating globally for most of the 20th century. Certainly in WWII, the amount of currency in circulation was increased several fold. However, the modern era of huge printings of the United States one hundred-dollar bill started with the fall of the Soviet Union in 1991. Production was quadrupled with the first ever trillion dollar printing of this bill. As of the end of 2008, U.S. currency in circulation with the public amounted to $824 billion and 76% of the currency supply was in the form of $100 denomination banknotes, amounting to twenty $100 bills per U.S. citizen. Over the past decade there has been considerable controversy concerning the amount of U.S. currency circulating abroad. Porter and Judson have claimed that in the mid nineties between 53-67 percent of U.S. currency was overseas, whereas Feige’s estimates suggested a figure closer to 40 percent abroad. Most recently, Goldberg writing in a New York Federal Reserve publication asserted that “about 65 percent ($580 billion) of all banknotes are in circulation outside of the country. However, these assertions are contradicted by the Federal Reserve Board of Governors Flow of Funds statistics which show that at the end of March 2009, only $313 billion (36.7 percent) of U.S. currency was held abroad. Feige calculates that since 1964, “the cumulative seigniorage earnings accruing to the U.S. by virtue of the currency held by foreigners amounted to $167-$185 billion and over the past two decades seigniorage revenues from foreigners have averaged $6-$7 billion dollars per year”.


The American $100 bill has some competition, primarily from the €500 note. The larger value of the banknote makes it easier to transport larger amounts of money. As an example, to carry $1 million in currency on board an airplane, and it is in $100 bills, the weight of the money is 22 pounds. It is difficult to carry this much without a briefcase and some physical security. Since it is against authority of Title 26 of the United States Code (U.S.Tax Code) regulations to carry more than $10,000 without reporting it (31 USC 5311), it is unlikely to pass security unnoticed. The same amount in €500 notes would weigh less than three pounds, and it could probably be dispersed in clothing and in luggage without attracting attention or alerting a security device. For many illegal operations the problem of transporting currency is more difficult than transporting cocaine because of the size and weight of the currency. The ease of transporting banknotes makes the euro very attractive to Latin American drug cartels.

美国的百元美钞也面对一些竞争,主要是€500欧元的纸钞。面值大的钞票方便转移大数额的钱。打个比方,带着一百万的货币登机,如果是百元钞,钱的重量是22磅。因此很难不用公事包和一些保安措施来携带这么多钱。由于这个做法违反了“美国法典”(US税务守则)第26条的规定,携带超过一万元却不通报(31 USC 5311),就很难通过安检。同等数量的€500欧元纸币的重量就少过三磅,很容易藏在服装和行李箱里分散开来而不引起人们的注意或触动保安设备。对许多非法行动来说,运送货币比起运输可卡因还困难,问题出在纸币的体积和和重量。轻易可运送钞票的欧元就吸引了拉丁美洲的毒品商。

The Swiss 1000 franc note is probably the only other banknote that is in circulation outside of its home country. It is worth slightly more than US$1000. However, to the non-Swiss it doesn’t provide a significant advantage over the €500 note as there are 20 times as many of the €500 note circulating and they are more widely recognized. As a reserve currency it is roughly 0.1% of the currency composition of official foreign exchange reserves.


Governments differ radically in their issuance of large banknotes. As of August 2009, the number of 1000 franc Swiss banknotes circulating is over 3 times the population of Switzerland. In comparison the number of £50 banknotes circulating slightly less than 3 times the population of UK. But the 1000 franc banknote is worth roughly £600. The British government has traditionally been wary of large banknotes since the counterfeiting Operation Bernhard in World War II which caused the Bank of England to withdraw all notes larger than £5 from circulation, and not reintroduce other denominations until the early 1960s (£10), 1970 (£20) and March 20, 1981 (£50). Circulation rates are so low that Britain could stop printing the £50 note and much of the population wouldn’t notice.


There is a banknote for 500 Latvian lats which is currently one of the most valuable notes in the world, as it is worth more than $1000, but it is unlikely to be accepted outside of Latvia. Likewise, the 10000 Singapore dollar note is the most valuable, but is rarely used and unlikely to be accepted outside of Singapore. Other currencies in Europe, like the British pound, and the Scandinavian currencies do not issue large value banknotes. Iceland in particular has never needed much currency since electronic transactions are commonplace, and their population is small with over 60% of the population living in one metropolitan area. Their largest banknote is worth less than €28.


South Korea is an example of a country with a high Human Development Index that fears counterfeiting so much that they don’t utilize large banknotes. South Korea has a larger purchasing power parity per capita than Latvia, but until recently the largest South Korean banknote was worth about US$8, which was a severe impediment to routine business. On June 23, 2009 they issued a new banknote worth five times as much.


The American treasury considered re-issuing a US$500 banknote when the euro banknotes began circulating. There was concern that the high value banknotes would provide competition. However, after recognition that the $500 banknote would provide a huge advantage to worldwide criminal operations and dictatorships, the decision was made not to pursue this option.


Canada briefly issued a $1000 Canadian dollar bill in 1992, but the Royal Canadian Mounted Police was able to successfully argue against the continued printing of this bill in 2000; it is still legal tender but no more are being printed, and it will diminish as older bills are destroyed. It was not widely circulated outside of Canada.



See also  另见

  • Central bank  中央银行
  • Digital gold currency  数码式黄金货币
  • Fractional reserve banking  部分储备金银行
  • Full reserve banking  全储备银行
  • Money  货币
  • Monetarism  货币主义
  • Demurrage (currency)  滞期费(货币)


External links  外部链接

  • Extensive discussion   广泛的讨论
  • Sovereignty & Seignorage  主权和铸币税
  • Information about Seigniorage  关于铸币税的信息
  • “The temptation of dollar seigniorage”, By Kosuke Takahashi of Asia Times Online, January 23, 2009.

美元铸币税“的诱惑” , 耿介高桥撰,亚洲时报在线 ,2009年1月23日。

  • “A better way to account for fiat money at the Central Bank” By Thomas Colignatus, December 31, 2005

“一个审计中央银行的法定货币更好的办法” Thomas Colignatus撰,2005年12月31日


Categories  分类

  • Numismatics  钱币学
  • Taxation  税务

—— END ——


Source >

Translated by > BlogHost

Word Count > approx. 2250 words in English



March 2, 2012 Leave a comment

Hedge (finance)  对冲(金融)


A hedge is an investment position intended to offset potential losses that may be incurred by a companion investment.


A hedge can be constructed from many types of financial instruments, including stocks, exchange-traded funds, insurance, forward contracts, swaps, options, many types of over-the-counter and derivative products, and futures contracts.


Public futures markets were established in the 19th century[1] to allow transparent, standardized, and efficient hedging of agricultural commodity prices; they have since expanded to include futures contracts for hedging the values of energy, precious metals, foreign currency, and interest rate fluctuations.



Contents  目录

1. Etymology  词源

2. Examples  例子

2.1 Agricultural commodity price hedging  农业商品价格的对冲

2.2 Hedging a stock price  对冲股价

2.3 Hedging Employee Stock Options  对冲员工股票期权

2.4 Hedging fuel consumption  对冲燃油消耗

3. Types of hedging  套期保值的类型

3.1 Hedging strategies  对冲策略

3.1.1 Financial derivatives such as call and put options  金融衍生工具如看涨和看跌期权

4. Natural hedges  自然对冲

5. Categories of hedgeable risk  可对冲风险的分类

6. Hedging equity and equity futures  对冲股权和股权期货

6.1 Futures hedging  期货套期保值

6.2 Contract for difference  价差合约

7. Related concepts  相关概念

8. See also  另见

8.1 Accountant views  会计师观点

9. References  参考文献

10 External links  外部链接


Etymology  词源

Hedging is the practice of taking a position in one market to offset and balance against the risk adopted by assuming a position in a contrary or opposing market or investment. The word hedge is from Old English hecg, originally any fence, living or artificial. The use of the word as a verb in the sense of “dodge, evade” is first recorded in the 1590s; that of insure oneself against loss, as in a bet, is from 1670s.



Examples  例子

Agricultural commodity price hedging  农业商品价格的对冲

A typical hedger might be a commercial farmer. The market values of wheat and other crops fluctuate constantly as supply and demand for them vary, with occasional large moves in either direction. Based on current prices and forecast levels at harvest time, the farmer might decide that planting wheat is a good idea one season, but the forecast prices are only that — forecasts. Once the farmer plants wheat, he is committed to it for an entire growing season. If the actual price of wheat rises greatly between planting and harvest, the farmer stands to make a lot of unexpected money, but if the actual price drops by harvest time, he could be ruined.


If at planting time the farmer sells a number of wheat futures contracts equivalent to his anticipated crop size, he effectively locks in the price of wheat at that time: the contract is an agreement to deliver a certain number of bushels of wheat to a specified place on a certain date in the future for a certain fixed price. The farmer has hedged his exposure to wheat prices; he no longer cares whether the current price rises or falls, because he is guaranteed a price by the contract. He no longer needs to worry about being ruined by a low wheat price at harvest time, but he also gives up the chance at making extra money from a high wheat price at harvest times.



Hedging a stock price  对冲股票价格

A stock trader believes that the stock price of Company A will rise over the next month, due to the company’s new and efficient method of producing widgets. He wants to buy Company A shares to profit from their expected price increase. But Company A is part of the highly volatile widget industry. If the trader simply bought the shares based on his belief that the Company A shares were underpriced, the trade would be a speculation.


Since the trader is interested in the company, rather than the industry, he wants to hedge out the industry risk by short selling an equal value (number of shares × price) of the shares of Company A’s direct competitor, Company B.


The first day the trader’s portfolio is:


  • Long 1,000 shares of Company A at $1 each
  • Short 500 shares of Company B at $2 each
  • 买空A公司的一千股,每股1元
  • 卖空B公司的五百股,每股2元

(Notice that the trader has sold short the same value of shares)


If the trader was able to short sell an asset whose price had a mathematically defined relation with Company A’s stock price (for example a put option on Company A shares), the trade might be essentially riskless. In this case, the risk would be limited to the put option’s premium.


On the second day, a favorable news story about the widgets industry is published and the value of all widgets stock goes up. Company A, however, because it is a stronger company, increases by 10%, while Company B increases by just 5%:


  • Long 1,000 shares of Company A at $1.10 each: $100 gain


  • Short 500 shares of Company B at $2.10 each: $50 loss


(In a short position, the investor loses money when the price goes up.)


The trader might regret the hedge on day two, since it reduced the profits on the Company A position. But on the third day, an unfavorable news story is published about the health effects of widgets, and all widgets stocks crash: 50% is wiped off the value of the widgets industry in the course of a few hours. Nevertheless, since Company A is the better company, it suffers less than Company B:


Value of long position (Company A):


  • Day 1: $1,000
  • Day 2: $1,100
  • Day 3: $550 => ($1,000 − $550) = $450 loss

第1天:$ 1,000
第2天:$ 1,100
第3天:$ 550 =>($ 1,000 – $ 550)= $450的损失

Value of short position (Company B):


  • Day 1: −$1,000
  • Day 2: −$1,050
  • Day 3: −$525 => ($1,000 − $525) = $475 profit

第1天: – $ 1,000
第2天: – $ 1,050
第3天: – $ 525 =>($ 1,000 – $ 525)= $475元的利润

Without the hedge, the trader would have lost $450 (or $900 if the trader took the $1,000 he has used in short selling Company B’s shares to buy Company A’s shares as well). But the hedge – the short sale of Company B – gives a profit of $475, for a net profit of $25 during a dramatic market collapse.



Hedging Employee Stock Options  对冲员工股票期权

Employee Stock Options are securities issued by the company generally to executives and employees. These securities are more volatile than stock and should encourage the holders to manage those positions with a view to reducing that risk. There is only one efficient way to manage the risk of holding employee stock options and that is by use of sales of exchange traded calls and to a lesser degree by buying puts. Companies discourage hedging versus ESOs but have no prohibitions in their contracts.



Hedging fuel consumption  对冲燃油消耗

Airlines use futures contracts and derivatives to hedge their exposure to the price of jet fuel. They know that they must purchase jet fuel for as long as they want to stay in business, and fuel prices are notoriously volatile. By using crude oil futures contracts to hedge their fuel requirements (and engaging in similar but more complex derivatives transactions), Southwest Airlines was able to save a large amount of money when buying fuel as compared to rival airlines when fuel prices in the U.S. rose dramatically after the 2003 Iraq war and Hurricane Katrina.



Types of hedging  套期保值的类型

Hedging can be used in many different ways including foreign exchange trading.[3] The stock example above is a “classic” sort of hedge, known in the industry as a pairs trade due to the trading on a pair of related securities. As investors became more sophisticated, along with the mathematical tools used to calculate values (known as models), the types of hedges have increased greatly.



Hedging strategies  对冲策略

Examples of hedging include:


  • Forward exchange contract for currencies  外汇的远期货币合约
  • Currency future contracts  货币期货合约
  • Money Market Operations for currencies  外汇的货币市场操作
  • Forward Exchange Contract for interest  利息的远期货币合约
  • Money Market Operations for interest  利息的货币市场操作
  • Future contracts for interest  利息的远期合约

This is a list of hedging strategies, grouped by category.



Financial derivatives such as call and put options


  • Risk reversal: Simultaneously buying a call option and selling a put option. This has the effect of simulating being long on a stock or commodity position.

风险逆转 : 同时购买看涨期权和卖出看跌期权,这么做有模拟股票或商品长仓的效果。

  • Delta neutral: This is a market neutral position that allows a portfolio to maintain a positive cash flow by dynamically re-hedging to maintain a market neutral position. This is also a type of market neutral strategy.

三角中性 : 这是一个市场中立的仓位,允许投资组合维持正现金流,通过动态的重新对冲去保持市场中立的仓位,这也是一种市场中立的策略。


Natural hedges  自然对冲

Many hedges do not involve exotic financial instruments or derivatives such as the married put. A natural hedge is an investment that reduces the undesired risk by matching cash flows (i.e. revenues and expenses). For example, an exporter to the United States faces a risk of changes in the value of the U.S. dollar and chooses to open a production facility in that market to match its expected sales revenue to its cost structure.


Another example is a company that opens a subsidiary in another country and borrows in the foreign currency to finance its operations, even though the foreign interest rate may be more expensive than in its home country: by matching the debt payments to expected revenues in the foreign currency, the parent company has reduced its foreign currency exposure. Similarly, an oil producer may expect to receive its revenues in U.S. dollars, but faces costs in a different currency; it would be applying a natural hedge if it agreed to, for example, pay bonuses to employees in U.S. dollars.


One common means of hedging against risk is the purchase of insurance to protect against financial loss due to accidental property damage or loss, personal injury, or loss of life.



Categories of hedgeable risk  可对冲风险的分类

  • There are varying types of risk that can be protected against with a hedge. Those types of risks include:


  • Commodity risk: the risk that arises from potential movements in the value of commodity contracts, which include agricultural products, metals, and energy products.

商品风险 :商品合约的价值,其中包括农产品,金属,能源产品的潜在变动。

  • Credit risk: the risk that money owing will not be paid by an obligor. Since credit risk is the natural business of banks, but an unwanted risk for commercial traders, an early market developed between banks and traders that involved selling obligations at a discounted rate.

信用风险 :债务人不付钱的风险。由于信用风险是银行业务的一部份,但却不是商业贸易业者要的风险,因此银行和商人之间就发展出一个早期市场,以折扣价出售权益。

  • Currency risk (also known as Foreign Exchange Risk hedging) is used both by financial investors to deflect the risks they encounter when investing abroad and by non-financial actors in the global economy for whom multi-currency activities are a necessary evil rather than a desired state of exposure.


  • Interest rate risk: the risk that the relative value of an interest-bearing liability, such as a loan or a bond, will worsen due to an interest rate increase. Interest rate risks can be hedged using fixed-income instruments or interest rate swaps.


  • Equity risk: the risk that one’s investments will depreciate because of stock market dynamics causing one to lose money.

股权风险 : 这是因为股市的动态导致赔钱使到投资贬值的风险。

  • Volatility risk: is the threat that an exchange rate movement poses to an investor’s portfolio in a foreign currency.

波动的风险 :这是汇率变动对投资者的外币组合的威胁。

  • Volumetric risk: the risk that a customer demands more or less of a product than expected.

质量风险 :客户对产品的要求高过或低过预期的。


Hedging equity and equity futures  对冲股权和股权期货

Equity in a portfolio can be hedged by taking an opposite position in futures. To protect your stock picking against systematic market risk, futures are shorted when equity is purchased, or long futures when stock is shorted.


One way to hedge is the market neutral approach. In this approach, an equivalent dollar amount in the stock trade is taken in futures – for example, by buying 10,000 GBP worth of Vodafone and shorting 10,000 worth of FTSE futures.

对冲的方式之一就是采取市场中立的态度。这种做法就是用相等的面值在期货中作股票交易 – 例如,用一万英镑购买Vodafone的股票再卖空价值一万FTSE富时指数的期货。

Another way to hedge is the beta neutral. Beta is the historical correlation between a stock and an index. If the beta of a Vodafone stock is 2, then for a 10,000 GBP long position in Vodafone an investor would hedge with a 20,000 GBP equivalent short position in the FTSE futures (the index in which Vodafone trades).


Futures contracts and forward contracts are means of hedging against the risk of adverse market movements. These originally developed out of commodity markets in the 19th century, but over the last fifty years a large global market developed in products to hedge financial market risk.



Futures hedging  期货套期保值

Investors who primarily trade in futures may hedge their futures against synthetic futures. A synthetic in this case is a synthetic future comprising a call and a put position. Long synthetic futures means long call and short put at the same expiry price. To hedge against a long futures trade a short position in synthetics can be established, and vice versa.


Stack hedging is a strategy which involves buying various futures contracts that are concentrated in nearby delivery months to increase the liquidity position. It is generally used by investors to ensure the surety of their earnings for a longer period of time.



Contract for difference  价差合约

A contract for difference (CFD) is a two-way hedge or swap contract that allows the seller and purchaser to fix the price of a volatile commodity. Consider a deal between an electricity producer and an electricity retailer, both of whom trade through an electricity market pool. If the producer and the retailer agree to a strike price of $50 per MWh, for 1 MWh in a trading period, and if the actual pool price is $70, then the producer gets $70 from the pool but has to rebate $20 (the “difference” between the strike price and the pool price) to the retailer.

差价合约(CFD)是一个双向的对冲或掉期合约,允许卖方和买方为波动的商品定价。想像电力厂家和电力零售商之间的交易,两者都通过集合的电力市场交易。如果厂家和零售商同意在某个交易期内以每兆瓦时$50成交,而实际的市价是$70,那么厂家会从结合市场得到$70但却要退 $20(成交价和市价的“价差”)给零售商。

Conversely, the retailer pays the difference to the producer if the pool price is lower than the agreed upon contractual strike price. In effect, the pool volatility is nullified and the parties pay and receive $50 per MWh. However, the party who pays the difference is “out of the money” because without the hedge they would have received the benefit of the pool price.

相反的,如果市价比合约商定的成交价来得低,零售商就必须支付价差给厂家。结果就是,市价的波动的影响是无效的,各方依旧支付和接收每兆瓦时50元。然而,付出差价的一方是在“ 自掏腰包 ”,要是没有对冲,他们就会收到市价的实际利益。


Related concepts  相关概念

  • Forwards: A contracted agreement specifying an amount of currency to be delivered, at an exchange rate decided on the date of contract.

  远期交易 :这是以合约签订日的汇率为准指定交付货币金额的协议。

  • Forward Rate Agreement (FRA): A contract agreement specifying an interest rate amount to be settled at a pre-determined interest rate on the date of the contract.

远期利率协议(FRA): 这是以合约签订日预定的利率为准指定结算利率金额的协议。

  • Currency option: A contract that gives the owner the right, but not the obligation, to take (call option) or deliver (put option) a specified amount of currency, at an exchange rate decided at the date of purchase.


  • Non-Deliverable Forwards (NDF): A strictly risk-transfer financial product similar to a Forward Rate Agreement, but used only where monetary policy restrictions on the currency in question limit the free flow and conversion of capital. As the name suggests, NDFs are not delivered but settled in a reference currency, usually USD or EUR, where the parties exchange the gain or loss that the NDF instrument yields, and if the buyer of the controlled currency truly needs that hard currency, he can take the reference payout and go to the government in question and convert the USD or EUR payout. The insurance effect is the same; it’s just that the supply of insured currency is restricted and controlled by government. See Capital Control.


  • Interest rate parity and Covered interest arbitrage: The simple concept that two similar investments in two different currencies ought to yield the same return. If the two similar investments are not at face value offering the same interest rate return, the difference should conceptually be made up by changes in the exchange rate over the life of the investment. IRP basically provides the math to calculate a projected or implied forward rate of exchange. This calculated rate is not and cannot be considered a prediction or forecast, but rather is the arbitrage-free calculation for what the exchange rate is implied to be in order for it to be impossible to make a free profit by converting money to one currency, investing it for a period, then converting back and making more money than if a person had invested in the same opportunity in the original currency.

利率平价(IRP)和对销汇率风险的套息 :这个简单的概念是指两个不同币种的两个类似的投资应该产生相同的回报。如果两个类似的投资并没有以相同的面值提供相同利率的回报,在概念上,其差额应该由这个投资期的汇率变动来补偿。基本上,IRP提供了估算预测或不明示的远期汇率的数学模式。这个计算率不是也不可以被当成是一个预言或预测,而是一种无套利的计算方式,计算汇率不明示该有的正常状态让人无法通过转换货币,投资一段时间,再换回原币去赚无本的利润,赚的钱就无法比那些投资在原有货币不转换的人还多。

  • Hedge fund: A fund which may engage in hedged transactions or hedged investment strategies.

对冲基金 :这是一个会从事对冲交易或对冲投资策略的基金。


See also  另见

  • Arbitrage  套利
  • Asset-liability mismatch  资产负债不匹配
  • Diversification (finance)  多样化(金融名词)
  • Fixed bill  固定汇票
  • Foreign Exchange Hedge  外汇对冲
  • Fuel price risk management  燃油价格风险管理
  • Immunization (finance)  免疫(金融名词)
  • List of finance topics  金融主题列表
  • Option (finance)  期权(金融名词)
  • Spread  差价

Accountant views  会计师观点

  • IAS 39  国际会计准则第39号
  • FASB 133
  • Cash flow hedge  现金流量对冲
  • Hedge accounting  对冲会计法

External Links  外部链接

  • Guide to Hedging Interest Rate Risk  对冲利率风险指南
  • Basic Fixed Income Derivative Hedging Article on


  • Hedging Corporate Bond Issuance with Rate Locks article on


  • The curious moral paradox of Hedging, and how Regulation gives it a blank cheque on



  • Derivatives (finance)  衍生金融工具(金融)
  • Financial terminology  金融术语
  • Finance  金融
  • Financial markets  金融市场
  • Financial instruments  金融工具
  • Corporate finance  企业贷款
  • Personal finance  个人贷款
  • Public finance  公共贷款
  • Banks and banking  银行与银行业
  • Financial regulation  金融条规
  • Standards  标准
  • Economic history  经济史

—— END ——


Source > Wikipedia at

Translated by > BlogHost

Word Count > approx.2600 words in English



February 28, 2012 Leave a comment

Cov-lite  淡契约


Cov-lite (“covenant light”) is financial jargon for loan agreements which do not contain the usual protective covenants for the benefit of the lending party. Although traditionally banks have insisted on a wide range of covenants which allow them to intervene if the financial position of the borrower or the value of underlying assets deteriorates, around 2006 the increasing strength of private equity firms and the decreasing opportunities for traditional corporate loans made by banks fuelled something of a “race to the bottom” with syndicates of banks competing with each other to essentially offer ever less invasive terms to borrowers in relation to leveraged buy-outs.


Cov-lite lending is seen as more risky because it removes the early warning signs lenders would otherwise receive through traditional covenants. Against this, it has been countered that cov-lite loans simply reflected changes in bargaining power between borrowers and lenders, and followed from the increased sophistication in the loans market where risk is quickly dispersed through syndication or credit derivatives.



Contents  目录

  • Covenants  条约
  • Concerns  需关注事项
  • 2007 credit crunch   2007年的信贷紧缩
  • References  参考文献
  • External links  外部链接


Covenants  条约

Practise varied, but characteristically, cov-lite loans would remove the requirement to report and maintain loan to value, gearing and EBITDA ratios.


More aggressively negotiated cov-lite loans might also remove:

  • events of default relating to “material adverse change” of the position of the borrower
  • requirement to deliver annual accounts to the banks
  • restrictions on other third party debt
  • restrictions on negative pledges
  • requirements for bank approval to change the form of the debtor group’s business


  • 跟借方面临“重大不利变数”有关的违约事件
  • 要求提供给银行的年度账目
  • 限制其他第三方的债务
  • 限制负面的抵押
  • 改变债务人集团的业务形式时需要银行的审批


Concerns  需关注事项

Many at the time were alarmed by the development; The Economist in particular thought it was a concerning and short-sighted development,[1] and the Financial Times endorsed the view of Anthony Bolton of Fidelity Investments who warned on his retirement in May 2007 that cov-lite could be “the tinder paper for a serious reversal in the market.”[2], the movement in the market was inexorable. Others argued that the move to cov-lite was a welcome simplification of loan documentation, and was fully justified as the banks would hedge their risk by transferring exposure to the loan in the CDO market.[3][4] It was also pointed out at the time that cov-lite loans operated in a very similar way to bonds, but at lower values.

当时许多人对事态的发展感到震惊,特别是经济学人期刊认为这是一个令人担心和短视的发展,而金融时报也赞同Fidelity Investment富达投资的Anthony Bolton安东尼博尔顿的看法,他在2007年5月退休时警告说,淡契约可以是“市场上的严重逆转的火绒纸,市场的动向是残酷的。另一些人认为淡契约是个受欢迎被简化了的贷款文件,完全合理,因为银行可以通过对冲去转移贷款在CDO市场面对的风险。当时也有人指出,淡契约式的运作方式类似债券,只是价值比较低。

The high water mark of cov-lite loans came in the acquisition by Kohlberg Kravis Roberts, a US private equity firm, by way of a record $16bn cov-lite loan for its buy-out of First Data.

淡契约式贷款的高水位标杆出现在美国的私有股权公司Kohlberg Kravis Roberts,以创纪录的160亿美元通过淡契约式贷款收购了First Data第一数据的案例上。


2007 Credit Crunch 。 2007年的信贷紧缩

The tendency towards cov-lite loans ended abruptly with the 2007 subprime mortgage financial crisis. Some commentators subsequently sought to attribute the credit crunch arising from crisis to cov-lite loans, although the LBO market is almost entirely unconnected with the sub-prime mortgage market in terms of exposure. However, in the credit crunch which ensured, cov-lite loans significantly hampered the ability of banks to step in and both seek to rectify positions which were going bad, and to limit their exposure once matters had gone bad. The suggestion that banks risks were mitigated through the CDO market was difficult to sustain in light of difficulties in that market itself as a result of the credit crunch. In March 2011, the Financial Times reported that in the three months prior, cov-lite loans to the value of $17bn had been issued.



References  参考文献

^ “You only give me your funny paper – Debt markets turn grouchy as creditors ask for more”. The Economist. June 28, 2007.


^ a b “Bolton warns of bubble fuelled by “cov-lite” loans”. Financial Times. May 18 2007. (subscription required)


^ Salmon, Felix (June 12 2007). “A Closer Look at Cov-Lite Loans”. Market Movers. BizJournals.


^ Comment, Deal (March 29, 2007). “Through the looking glass with leveraged finance”. Legal Week blogs. Archived from the original on June 30, 2007.

评论,成交(2007年3月29日)“通过眼镜看杠杆融资”。Legal Week部落格,源自原文于2007年6月30日刊登的档案。

^ Tett, Gillian (March 4, 2011). “The return of cov-lites hints at more caution not madness”. (Financial Times) Fidelity Worldwide Investment. Archived from the original on March 4, 2011.



External Links  外部链接

  • Money Terms – “cov-lite”  金钱术语- “淡契约”

Categories  分类

  • Financial terminology  金融术语
  • Contract clauses  合同条款
  • Private equity  私人股本

—— END ——


Source >  Wikipedia at

Translated by > BlogHost — hkTan

Word Count > approx.700 words in English


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