Presentation on the topic: "Securities market instruments. Debt instruments market. Debt instruments market - bonds, bills, promissory notes and other instruments are traded." Download for free

What is the stock market

There are four types of markets - foreign exchange, futures, money market and stock market. Each of them uses its own financial instruments, that is, documents that can be sold or transferred to receive money. Securities are traded on the stock market, and they are its main instrument. In essence, these are certain types of obligations with the help of which investment occurs.

Stock market instruments can be divided into two large subgroups:

main instruments (which include bonds and shares);
derivative instruments (these are options, bills, checks, futures, etc.).

General provisions

The table shows data on the volume of investments of credit institutions in securities (debt obligations (except bills) and equity securities). Checks, warehouse receipts and bearer passbooks are not included, as are the fair values of derivative financial instruments that represent an asset.

The table does not take into account the indicators of Vnesheconombank, which is not included in the existing credit institutions.

Characteristics of individual indicators

Investments in debt obligations - the volume of investments of credit institutions in debt obligations that are classified as securities by the legislation of the Russian Federation (debt obligations of the Russian Federation, the Bank of Russia, constituent entities of the Russian Federation and local governments, credit organizations - residents of the Russian Federation, residents of the Russian Federation, not being credit institutions, debt obligations transferred to counterparties for transactions carried out on a repayable basis, the recognition of which has not been terminated, debt obligations of non-residents (except for bills of exchange), which, in accordance with the legislation (law) of the country of their issue, are recognized as securities). The volume of investments in debt obligations includes securities measured at fair value through profit or loss, available for sale, held to maturity, as well as debt obligations not repaid on time, denominated in the currency of the Russian Federation or in foreign currencies. At the same time, debt obligations assessed at fair value through profit or loss, as well as available for sale, are reflected taking into account the revaluation of securities.

Revaluation of debt obligations (equity securities) - negative and positive differences between the book value of securities and their current (fair) value. All securities “measured at fair value through profit or loss”, as well as securities “available for sale”, the current (fair) value of which can be reliably determined, are subject to revaluation.

Investments in debt obligations (equity securities) at book value (excluding revaluation) - the volume of investments of credit institutions in debt obligations (equity securities), reflected at book value (excluding revaluation). It is given due to the inability to break down the total volume of relevant investments by current (fair) value by issuing entities (a feature of the structure of the Chart of Accounts). The following columns reflect the breakdown of this amount by issuer, the volume of debt obligations (equity securities) transferred without derecognition and debt obligations not repaid on time.

Debt obligations (equity securities) transferred without derecognition are securities transferred to counterparties under transactions carried out on a repayable basis, the recognition of which has not been derecognised.

Debt obligations not repaid on time are the costs of acquiring debt obligations and the amount of interest (coupon) income previously attributed to income in the event that the issuer of securities does not receive funds to repay them on time.

Participation in subsidiaries and affiliated joint-stock companies is the amount of funds invested in shares of subsidiaries and affiliated joint-stock companies - residents and non-residents, in an amount that provides control over the management of the issuing organization or significant influence on the activities of the joint-stock company.

Derivative financial instruments are the fair value of derivative financial instruments that represent an asset.

A productive financial instrument is an asset if the total value of the claims to the counterparty contained in the relevant agreement exceeds the total value of the obligations to the counterparty under this agreement and the credit institution expects an increase in future economic benefits as a result of the receipt of assets (cash or other property), the exchange of assets or repayment of obligations on potentially favorable terms for the credit institution.

Main financial instruments of the stock market

The main ones are those securities, the essence of which is property rights to an asset (this can be money, property, goods, resources, etc.). These primarily include shares.

Stock

Shares are those securities that assign to their owner the fact of participation in the formation of the fund of a joint-stock company, and those that give the owners the right to receive profit from the activities of this company. This instrument is very widely represented both in the Russian and global markets. Shares are low-liquid (that is, difficult to convert into money), but highly profitable instruments.

Shares provide an opportunity to receive income, but the amount of this income is not known in advance and is not even guaranteed. What it will be is determined by the joint stock company that issued the shares; it is based on the income received by the company for the year. To receive a constant and high income from stocks, you need to constantly monitor changes in the market and news on the stock exchange, sell and buy these securities.

Shares are divided into categories depending on the privileges that their owners receive with their help. Preferred shares make it possible to fix part of the property if for some reason the owner declares himself bankrupt. That is, if the company goes bankrupt, the invested money will be returned.

Bonds

Another category of securities is bonds. They confirm that their owner gave money to the one who issued the bonds, and the one who issued the bonds is obliged to pay this money within the agreed period, and the owner will receive a pre-agreed income. There are significantly fewer bonds on the Russian market than on foreign markets, but in terms of the volume of transactions, it is bonds that occupy a leading position (due to government securities).

Bonds have their own classification. They may vary:

by issuer (the one who issued them) - be state, municipal, corporate;
by type of income - there are discount (without fixed income), coupon (with fixed income) and with a floating interest rate;
if possible, exchange - there are convertible and non-convertible.

Debt and equity securities

Securities are usually divided into two large classes: debt and equity.

In a promissory note, the debtor declares when, in what quantity and how he will return the funds to the creditor. A classic promissory note is a promissory note. It is a very old financial instrument from which many others have evolved. For example, bonds can be considered as a special case of a bill of exchange, in which only the most fundamental parameters are retained.

Equity securities determine the investor's share in a project, capital, etc. A classic example of equity securities are shares, which determine the shareholder’s share in the authorized capital of a joint-stock company, the right to receive income in one form or another, as well as the right to participate in the management of the enterprise.

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Each class of securities has its own characteristic features, its own concepts and operating rules. For this reason, the securities market is usually divided into the debt market and the equity market.

In the debt market, the investor knows exactly the final outcome of his transactions. The degree of risk when purchasing bonds is determined mainly by the possible refusal of the debtor to make the promised payments on the promised date. The trading technique usually boils down to viewing the parameters of bonds that are announced in advance and selecting the most profitable bonds issued by the most reliable organizations.

In the stock market, everything is completely different. The shareholder is promised little. Dividends may or may not be paid. If they pay, it won’t necessarily be this year. They promise voting rights, but not to all shareholders. They promise a share of the enterprise, but do not say how much it costs. There is a different way to make money in the stock market. An investor invests money either in a promising company, the shares of which, according to the investor’s forecast, will significantly increase in price in a few years, or in shares whose price changes regularly, which allows you to play on price differences over a short period of time. The first strategy is used by a long-term investor, and the second by a short-term trader. The main risk lies in the uncertainty of the forecast. An important political event within the country, for example, the election of a new president, the adoption of a new law affecting the activities of an enterprise, a change in the economic situation and much more can significantly affect the value of the enterprise’s assets, the market price of its shares and even call into question the very existence of the enterprise. The risk in the stock market is significantly higher than in the bond market. But the higher the risk, the greater the profitability. Practice shows that investing in a bank or currency always and in all countries does not lead to a real increase in capital: everything is “eaten up” by inflation. And only long-term investments in shares allow you to increase capital, because the growth rate of a reliable enterprise exceeds the rate of inflation.

The state, municipal structures or enterprises, that is, legal entities, issue securities, such as bonds, in order to obtain a cheaper loan from the population than from a bank. The one who issues securities is called the issuer. Investors of funds in securities, that is, investors; can be both legal entities and individuals.

The sale of securities to investors usually begins at auction and is conducted either by the issuer itself or its intermediary. The intermediary who, under an agreement with the issuer, performs this task is called an underwriter (from English - underwriter, that is, the one who signed the lowest in the agreement). The first stage of placement of securities by the issuer or its underwriter is called the primary market. Dates for auctions for the sale of securities can be found on many Internet sites, in particular on the MICEX website. Typically, in the menu of a Web page, the announcement of auctions is hidden behind the abbreviation IPO (from the English expression Initial public offering).

Then, investors who purchased securities on the primary market can carry out trading operations with them with any legal entities or individuals. The free circulation of securities between investors forms a secondary securities market. In turn, the secondary market is divided into organized and unorganized. As a rule, organized trading of securities takes place on an exchange, where there are certain rules for concluding transactions and ways to protect the interests of buyers and sellers. Therefore, the organized market is often called the exchange market, and the unorganized market is often called the over-the-counter market. Sometimes the over-the-counter market can be called the "street" market. This is not entirely correct, since securities are bought and sold not only “on the street”, but also in stock or financial stores. In the literal sense of the word, it was popular at the first stage of perestroika: privatization checks (vouchers) were traded in the subway, at trolleybus stops and at the factory entrances. For investors, the safest place is the stock market.

The concept of “exchange” is used in different sources in a fairly broad sense. In economics, this can often mean simply a trading platform. In jurisprudence, an exchange is understood as a well-defined structure that has an appropriate license for exchange activities and has certain legal rights and obligations. Thus, in economic literature they talk about a real estate exchange or a labor exchange, although from a legal point of view this is illegal. In an economic sense, a simple trading platform turns into an exchange when it performs certain functions. In a legal sense, in order to transform a trading platform into an exchange, it must be registered with a certain government agency according to a certain scenario.

Differences between stocks and bonds

Newcomers to the stock market do not always understand the difference between the main financial instruments of the stock market. A stock is an investment instrument; you can return the invested funds only if you sell the existing securities. Income from shares depends on how exactly the enterprise (joint stock company) operated. If a profit is made at the end of the year, the shareholder will receive income. If there was no profit, then the shareholder will receive nothing. A joint stock company may grow or shrink, investors will invest or bypass the company - the share price will change accordingly.

A bond is an instrument for immediate income; it is valid only for a certain period. The income of the bond owner is known initially; it is calculated based on the par value of the security. This is a fixed value (which is the main difference from a stock). A bond also differs from a bank deposit in that it can be sold; it is a tradable instrument. Bond prices also change, although not as dramatically as stocks.

All legal aspects of making money on financial instruments are collected in this section. Read more about how to invest money correctly here.

Role and functions of the securities market

The stock market is part of the financial market, which means it is capable of solving a number of financial problems.
The turnover of securities helps to concentrate, centralize and accumulate funds and capital in order to meet the needs of the market and its subjects. The market itself serves the relationships that arise regarding the issue and exchange of stock instruments. It ensures the flow of funds into the real sector of the economy. Most of the producers' needs for capital and money are covered from their own reserves and profits. The remaining amount is raised through loan capital and investments in securities. The use of stock instruments allows you to obtain additional income through the use of free funds. The securities market becomes attractive to investors provided that the market has the required level of profitability, the volume and degree of risks on it are within acceptable limits, taxation is implemented in accordance with current legislation, and the level of services of professional participants is sufficiently high.

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Note 1

The classification of stock markets occurs in relation to the properties of existing transaction objects. Their object is a security, which is a strict reporting document confirming the property right of ownership. Any transactions with it are carried out in its physical presence, or with the help of a document confirming ownership of the stock instruments.

Markets can be primary or secondary, depending on the novelty of the securities in circulation. In the secondary market, previously issued stock instruments are used and more intensive exchange is carried out. Unregulated markets are not controlled by the government. All operations are carried out on a contractual basis. Regulated or organized markets are characterized by the participation of professional actors. They are characterized by high accuracy of information, a certain list of guarantees and insurance of transactions. At the same time, the requirements for participants are also quite high.

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If transactions are carried out on a stock exchange, then the market is called an exchange market. If other platforms are used for transactions, including electronic ones, then the market is non-exchange. The development of high technologies and the spread of the Internet have created widespread access to trading for almost all well-known subjects of economic relations.

Stock market derivatives

Another, completely separate financial instrument of the stock market is commodity assets, that is, real goods (gold, cotton, oil, grain, etc.), but they are purchased on the stock exchange as a financial asset. This is due to the fact that the cost of these goods is growing all the time, so such a purchase saves money and protects them from inflation and depreciation. And in order not to store goods at home, stock investors came up with settlement contracts - options and futures.

Options

If securities are based on any price asset, then they are called derivatives. One such stock market instrument is an option. This is an agreement or contract (between an exchange and an investor, or between two investors), which states that one of the parties has the right to purchase or sell a price asset, and the other party must ensure the implementation of this right, but within a strictly defined period. The asset can be government bonds (short-term) and commodities.

Options are divided into American, European and Bermuda. The first can be sold at any time during the agreed period, the second - only on one specific date specified in the contract, the third - on several days specified in the contract.

Options are considered those financial instruments that help insure against a market collapse and reduce investment risks. The advantages of options are the delay in action and the use of less of your funds. Its difference from other contracts with a deferred period is that only the right, and not the obligation, to perform actions is prescribed.

Futures

Another stock market instrument is futures. These are also contracts drawn up in such a way that one of the parties gets the opportunity to purchase securities at an agreed price within a specified period of time. That is, you can buy something in the future for the price today. Such futures contracts are always standardized; they contain clear requirements of sellers and buyers of securities.

We must always remember that the more expensive the stock, the more expensive the futures. But this is only true for the period when the conditions created by the future (the second party to the contract) are met. If the future is sold in a different period, it is indistinguishable from ordinary shares.

The disadvantages of futures as a tool for making money are that shares not only increase in price, but also decrease. The risk of using futures is high - you can suffer significant losses.

Futures can be deliverable (on the date specified in the contract, the seller sells and the buyer purchases the assets specified in the specification. The asset is delivered at the price noted on the last day of trading). And also non-deliverable (settlement), when payment occurs only in money, and the buyer transfers to the seller the difference between the value specified in the contract and the actual value on the day the contract is executed.

Stock indices

There is also such a financial instrument that is little understood by the average person as a stock index. This is a composite indicator that is calculated based on the index basket (the total value of any category of securities). The index does not have such an indicator as price; its changes are described by the categories “value” or “level”.