IMPORTANT CONCEPTS USED IN EQUITY MARKET

abhishreshthaa

New member
FDI- FDI is the acquisition of a controlling interest in a foreign firm or affiliate (branch, subsidiary, etc.).

There are a variety of ways that FDI can occur, including building new foreign facilities from scratch ("Greenfield investment"), merging with a foreign firm, taking over a foreign firm, and entering a partnership with a foreign firm (Example; a joint venture).



Horizontal FDI involves investing in a firm that is in the same industry. Vertical FDI involves investing in a supplier or customer firm.




PI - Portfolio investments consist mainly of the holding of transferable securities or guaranteed by the govt. of the capital importing country. Such holdings do not amount to right to control the company. E.g. shares, debenture, bonds etc.




GDR - “Global Depositary Receipts mean any instrument in the form of a depositary receipt or certificate (by whatever name it is called) created by the Overseas Depositary Bank outside India and issued to non-resident investors against the issue of ordinary shares or Foreign Currency Convertible Bonds of issuing company.”



They are negotiable certificates that usually represent a company’s publicly traded equities and can be denominated in any freely convertible foreign currency.



They are listed on a European stock exchange, often Luxembourg or London. Each DR represents a multiple number or fraction of underlying shares or alternatively the shares correspond to a fixed ratio, for example, 1 GDR = 10 Shares.




ADR - A GDR issued in America is an American Depositary Receipt (ADR). An ADR represents an ownership interest in foreign securities. It is a negotiable instrument issued by an American Depository bank certifying that shares of a non-US issuing company are held by the depository’s custodian bank abroad.



Each unit of ADR is called an American Depository Share (ADS). They are an ideal way for foreign companies to raise funds to expand their international capital base and get name and product exposure in the US. ADR could be listed on the New York stock exchange, NASDAQ or could be issued as private placement securities under rule 144a in the US.
 

rosemarry2

MP Guru
FDI- FDI is the acquisition of a controlling interest in a foreign firm or affiliate (branch, subsidiary, etc.).

There are a variety of ways that FDI can occur, including building new foreign facilities from scratch ("Greenfield investment"), merging with a foreign firm, taking over a foreign firm, and entering a partnership with a foreign firm (Example; a joint venture).



Horizontal FDI involves investing in a firm that is in the same industry. Vertical FDI involves investing in a supplier or customer firm.




PI - Portfolio investments consist mainly of the holding of transferable securities or guaranteed by the govt. of the capital importing country. Such holdings do not amount to right to control the company. E.g. shares, debenture, bonds etc.




GDR - “Global Depositary Receipts mean any instrument in the form of a depositary receipt or certificate (by whatever name it is called) created by the Overseas Depositary Bank outside India and issued to non-resident investors against the issue of ordinary shares or Foreign Currency Convertible Bonds of issuing company.”



They are negotiable certificates that usually represent a company’s publicly traded equities and can be denominated in any freely convertible foreign currency.



They are listed on a European stock exchange, often Luxembourg or London. Each DR represents a multiple number or fraction of underlying shares or alternatively the shares correspond to a fixed ratio, for example, 1 GDR = 10 Shares.




ADR - A GDR issued in America is an American Depositary Receipt (ADR). An ADR represents an ownership interest in foreign securities. It is a negotiable instrument issued by an American Depository bank certifying that shares of a non-US issuing company are held by the depository’s custodian bank abroad.



Each unit of ADR is called an American Depository Share (ADS). They are an ideal way for foreign companies to raise funds to expand their international capital base and get name and product exposure in the US. ADR could be listed on the New York stock exchange, NASDAQ or could be issued as private placement securities under rule 144a in the US.

Hey buddy,

I also got some information on Basics of Stock Market and would like to share it with you and other student's. So please download and check it.
 

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