Question

ACCT 1020

chapter 12

80-20 basis. 80% goes to your 1st post and 20% goes to your response to another student's post. . Unit 1 Discussion2 Discussion Topic Note-Your discussion post should be in your own words. Copying & pasting from a website will get you a zero. In this discussion question you will learn about stock markets. Log into: How the Markets Work and read about the types and features of the stock markets. From the following list write about some points that you find interesting in trading stocks. . Public Companies • Market Participants • Types of Brokerage Accounts Types of Orders Stock Purchases and Sales: Long and Short • Executing an Order You should also give your opinion about what your classmates write. Please use your constructive opinion. . . Please note that you have to post your answer first before you can see other posts. Your grade is on 80-20 basis. 80% goes to your 1st post and 20% goes to your response to another student's post. 00) ENG 7:14 PM 9/19/2020 o i

Answer 1

(a)

1-Public Companies

The term Public Companies can be defined in various ways.Usually on public companies, More than 51% Of share are of public sector. And the company’s securities trade on public markets.The companies will regularly discloses their financials to public.They sell securities in a public offering .

2-Market Participants

Part of the mission of the SEC is “to maintain standards for fair, orderly, and efficient markets.” To do this, the SEC regulates a number of securities market participants. some of the examples are below

i)Broker dealers:They will charge a fee to handle the trade between buyer and seller of the securities. The brocker dealer may buy securities from heir customers who selling and may selling to those who buy.

ii)Clearing Agencies:They are self regulatory organisation required register under SEC, Like all SRo they are liable to write and enforce the rule and laws including the disciplining members.

iii)Credit Rating Agencies:they are the Agencies provide opinions on the creditworthiness of a company, or security. They indicate the credit quality by means of a grade. Generally, credit ratings distinguish between investment grade and non-investment grade.

other market participants are ECNs/ATSs,Investment Advisers,Securities Exchanges,Self-Regulatory Organizations (SROs),Transfer Agents

3-Types of Brockerage Acounts

Cash account

This is a type of brokerage account in which the investor must pay the full amount for securities which purchased. In a cash account, you are not allowed to borrow funds from your broker to pay for transactions in the account.

margin account

This is a type of brokerage account in which your brokerage firm can lend you money to buy securities, And with the securities in your portfolio serving as collateral for the loan. As with any other loan, you will incur interest costs when you buy securities on margin...

4-Types of Orders

Most common types of orders are market order, Limit order and atop less order

Market Order:Thiss is an order to buy or sell a security immediately. This type of order guarantees that the order will be executed, but does not guarantee the execution price.

Limit order:This is an order to buy or sell a security at a specific price or at better. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher.

Stop-loss order:This is an order to buy or sell a stock once the price of the stock reaches the specified price, known as the stop price.

5-Stock Purchases and Sales: Long and Short

Having a long position in the security means that, the investor will own the securities for a larger period.security positions in the expectation that the stock will rise in value in the future.

Short position generally sale of stock that you do not own. Investors who sell short believe the price of the stock will decrease in value. If the price drops, you can buy the stock at the lower price and make a profit.

6-Executing an Order

When you order to sale or buy a security you may never consider about the brockerage or how, when you need to order for the security. But definitely it will effect the price. So its very important to notiece some factors befor exicuting order

(b)

The answers of classmate also be similar to mine. Beacause the meaning of thr above point does not have any suggestion value. Its have an appropiate fixed lines.