Financial Institutions and Markets - NMIMS University Solved assignments latest

 

Dear students, get fully solved assignments by professionals

Do send your query at :

help.mbaassignments@gmail.com

 

or call us at : 08263069601

(Plagiarism proofed assignments available with 100% surety and refund)

 

 

NMIMS Global Access

 

Course: Financial Institutions and Markets

 

Internal Assignment Applicable for December 2023 Examination

 

Assignment Marks: 30

 

Q1. Mr Raman is one of the director in XYZ ltd company .The company is engaged in hotel sector ,which has recently witnessed a steady downfall in its revenue and value of its assets due to a downward trend persisting in the market. The periodical financial result of the company were to be declared in the fortnight time. Mr. Raman being an insider, had to access to unpublished price sensitive information related to it. Consequently, he sells the major portion of his holding in an anticipation of fall in the market price of the shares of the company subsequent to announcement of periodical financial result of the company. On conducting a probe, SEBI finds Mr. Raman guilty of insider is trading. In context to the above case – State the importance of SEBI and its various functions. (10 Marks)

Answer: The case of Mr. Raman engaging in insider trading highlights the critical importance of the Securities and Exchange Board of India (SEBI) and its functions in maintaining the integrity and fairness of the Indian securities market. SEBI plays a pivotal role in regulating and supervising various aspects of the financial markets. Here are the key functions and their importance in this context:

1. Protection of Investor Interests:

• Importance: SEBI's primary role is to safeguard the interests of investors in securities markets. In Mr. Raman's case, his insider trading posed a threat to other investors who did not have access to the same confidential information. SEBI's actions in this regard aim to protect innocent investors from
•  
•  
•  

Q2. Rima buys a financial asset from the RBI. This financial asset is an instrument of shortterm borrowing. He has bought it because he doesn’t want to take risk and wants an assured return. This instrument is a promissory note. It is highly liquid. The instrument is also known as zero coupon bonds. On this instrument, it is written T-91 Based on the above case study, Identify the financial asset indicated in the above case .elaborate why this instrument is called as zero coupon bonds and mention what are functions of these instruments and why this is called as T-19? (10 Marks)

 

Answer:  The financial asset described in the case study is a Treasury Bill, which is often abbreviated as "T-Bill" and is also known as a zero-coupon bond. Let's break down the key aspects of this financial instrument and why it is referred to as a zero-coupon bond:

 

1. Zero-Coupon Bonds:

• Zero-coupon bonds are financial instruments that do not make periodic interest or coupon payments to the bondholder. Instead, they are issued at a discount to their face value and mature at face value.
• The return to the investor is the difference between the purchase price and the face value, making it an "assured return" because the final payout is predetermined.

2. Functions of Treasury Bills (T-Bills):

• T-Bills are short-term government securities issued by the Reserve Bank of India (RBI) on behalf of the Indian government.

 

Q3. Nishanth was working in the portfolio management department of Beta Ltd and had new recruits to whom he was supposed to provide training on the risks associated with the financial market as apart from earning returns they should be well aware of the risks that can be managed and which ones cannot be managed in a portfolio. He decided to broadly classify the risks in two categories and explain the different types of risks associated with each one. If you are Nishanth,

 

a) Explain different types of risks associated with systematic risk. (5 Marks)

Answer:  As Nishanth, when providing training on the risks associated with the financial market, it's important to explain the different types of risks associated with systematic risk. Systematic risk, also known as market risk or non-diversifiable risk, is the risk that affects the entire market and cannot be eliminated through diversification. Here are the key types of risks associated with systematic risk:

1.       Market Risk:

·          

 

b) Explain different types of risks associated with unsystematic risk. (5 Marks)

Answer: As Nishanth, when providing training on the risks associated with the financial market, it's essential to explain the different types of risks associated with unsystematic risk. Unsystematic risk, also known as specific risk or diversifiable risk, is the risk that is unique to a particular company, industry, or asset and can be mitigated through diversification. Here are the key types of risks associated with unsystematic risk:

1. Company-Specific Risk:

• Company-specific risk is unique to a particular company and is not related to the broader market. It can include:

 

Dear students, get fully solved assignments by professionals

Do send your query at :

help.mbaassignments@gmail.com

 

or call us at : 08263069601

(Plagiarism proofed assignments available with 100% surety and refund)