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Q: Finance ( Answered 5 out of 5 stars,   0 Comments )
Question  
Subject: Finance
Category: Business and Money > Finance
Asked by: baseball2-ga
List Price: $10.00
Posted: 19 Apr 2005 17:53 PDT
Expires: 19 May 2005 17:53 PDT
Question ID: 511597
Please provide me some examples to the following financial routes:

1. Investor to financial intermediary, to financial markets, and to the corperation

2. Investor to financial markets to a finanacial intermediary, and to
the corporation

3. Investor to financial markets, to a financial intermediary, back to
financial markets, and to the corporation

I could use an answer tonight if all possible.
Answer  
Subject: Re: Finance
Answered By: omnivorous-ga on 20 Apr 2005 14:52 PDT
Rated:5 out of 5 stars
 
Baseball2 --

I?m providing one example of each.  Note that investors can be
individuals, corporations, pension funds, mutual funds, venture
capital groups ? and that in certain situations each can also be an
intermediary.  Even individuals, playing the role of arbitrageurs,
COULD be considered an intermediary.


1. Investor to financial intermediary, to financial markets, and to the corporation

*  Investors put money in a venture capital fund.  At IPO it purchases
newly-issued shares, with proceeds going directly to the company
treasury.


2. Investor to financial markets to a financial intermediary, and to
the corporation

*  Investor holding stock (perhaps a founder) sells shares in an IPO
and they?re purchased by a mutual fund.  Later the company does a
buyback of those shares directly from the mutual fund, putting the
shares back in the treasury.


3. Investor to financial markets, to a financial intermediary, back to
financial markets, and to the corporation.

We can use the previous example but rather than have the company do a
direct buyback, they can purchase shares in daily market trades.  So
it?s investor holding stock ? sale in IPO to mutual fund ? company
authorizes buybacks at the market ? shares put back in treasury.

Best regards.,

Omnivorous-GA
baseball2-ga rated this answer:5 out of 5 stars

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