Ch-10(Financial Markets)

                                          

Must show this video

 

Clickable Mind map of the chapter: Click here 

Acronym to remember 3 functions of SEBI: Click here 

Teaching-learning resources for the Financial Market chapter: Click here 

A real-life example of Securities market Malpractice (Insider trading): Click here 

interesting Storyboard/ comic explaining the Steps in Trading and Settlement procedure on a Stock Exchange. CLICK HERE

Direct Questions:

1.       What do you mean by Financial market

2.       Explain the term Financial intermediation

3.       Show the process of allocation of funds with the help of a diagram

4.        Discuss functions of the Financial market

5.       Differentiate between Capital and money market

6.       Explain five money market instruments

7.       What do you mean by ‘Bridge financing’?

8.       What do you mean by Zero-coupon Bonds and why?

9.       Name the two types of Capital markets and differentiate between them.

10.   Define Stock exchange

11.   Give the meaning of Stock exchange

12.   Write a brief note on Stock exchanges in India

13.   Discuss functions of the Stock exchange

14.   Explain the trading procedure on a stock exchange

15.   What do you mean by Depository services

16.   What are services offered by Depository

17.   What are the benefits of  Depository services

18.   What do you mean by Dematerialisation  of securities

19. What do you mean by Depositary and Depositary Participant?

20.   What do you mean by Demat Account

21.   What are the advantages of Demat Account

22.   What is the reason for the establishment of SEBI

23.   What are the objectives of SEBI

24.   What are functions performed by SEBI

Indirect Questions:

1.  The directors of a company want to modernize its plant and machinery by making a public issue of shares. They wish to approach the stock exchange, while the finance manager prefers to approach a consultant for the new public issue of shares. Advise the directors on whether to approach the stock exchange or a consultant for a new public issue of shares and why? Also, advise about the different methods that the company may adopt for the new public issue of shares.

2.  You are a finance expert. One of your friends comes to you and tells you that the capital market and the money market are one and the same, whereas you differ with him. How would you convince him? Give any four reasons. 

3. SEBI is the watchdog of the securities markets”. Do you agree? Give reasons. 

4.   “In today’s Commercial world, the stock exchange performs many vital functions.” Do you agree?   Give any four reasons in support of your answer. 

5. “Primary markets contribute to capital formation directly, secondary markets do so indirectly.” Explain

6.  ‘Money market instruments are more liquid than capital market instruments’. Comment.

7.   ‘Stock market imparts liquidity to investment’. Comment.

8.“Stock market quotations contribute to better allocation of capital and promoting the habits of savings and investments”. Explain.

Case Study  

1. Priyanka’s grandfather who was unwell called her and gave her a gift packet.  Priyanka opened the packet and saw many crumpled share certificates, debentures, and bonds inside. Her grandfather told her that they had been left behind by her late father. As no trading is now done in physical form, Priyanka wants to know the process by adopting which she is in a position to deal with these share certificates, debentures, and bonds.  

a) Identify and state the process. 

b) Also give two reasons to Priyanka why dealing with shares, debentures, and bonds in physical form had been stopped.

2. Mr. Raman was holding 1,000 equity shares of Infosys Limited. To raise the funds, the company offered shares in the ratio 5:1 against the shares held by him at a price below the market price, which he accepted. As the shares were in physical form, he contacted a depository participant to convert them into electronic form. Later, after a few years, he needed money for his child’s education and decided to sell the shares.

(a) Name the method of issuing further equity shares by the company.

 (b) Name the term used to convert the shares into electronic form.

 (c) Advice Mr. Raman how he can sell his shares to arrange the funds

     

Identify the money market instrument.Try this worksheet

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Check the post on Bulls and bears: Click here 

Try Crossword puzzle: Click here 

Explain the trading procedure on a stock exchange? 

Ans: Click here for notes 

Click below to see Video trading procedure on a stock exchange  

                                    

Ans to direct questions 15-21
Click here 

What is D mat Account check video below 

What is Primary market ? - check video below 

What is a Secondary market or stock exchange? - check the video below 

What are stock indices(Sensex, Nifty)- check video below