Financial Institutions Failure Reason Unearthed: Analyse Facts Before Believing Eyes | Blog Brings Profit For You
  • Recover Lost Money Plan

    A number of traders have lost their money in the market due to wrong trading advice or wrong decisions and emotions. We keep on getting a number of requests for helping these traders recover their lost money. Thus, this was the genesis of Recover Lost Money Plan. We are proud to say that till date we have helped 1290 people recover their lost money. Recover Lost Money in Market

  • Our Most Successful Intraday Tip

    Jackpot tip, as the name suggests has the potential to make you a Millionaire as it is not the number of tips one trades; but it is the accuracy of a single tip which has the potential to make you a Millionaire. This tip is a value for money for all i.e whether one can see the trading terminal or not or is dealing through a broker on phone at BSE, NSE or in Future and Options segment.
    Click on Jackpot Sure Shot Tip to know more...

Subscribe to this blog

Subscribe to full feed RSS
What is Daily Market State???
Enter your Email

Preview | Powered by FeedBlitz

Financial Institutions Failure Reason Unearthed: Analyse Facts Before Believing Eyes

Posted By On 12/16/2008 09:02:00 PM Under
1. Derivative contracts is a lucrative technique to make money from the stock market and same has been used by a number of CEO to show impressive earnings and may favour a trader who is eyeing a multi-million dollar bonus and in this quest a number of wrong practices are undertaken. The Point here to consider is that at times the earnings which are reported in the annual reports is an eye wash and thus a critical eye is required to catch these wrong doers by neck. Derivatives instruments like total-return swaps are those contracts which enable one to leverage in various markets, including stocks and that too 100%.

2. The point to explain is that at times such transactions are undertaken which are beyond the perview of naked eye and market regulators like Party A to a contract which is generally a bank, puts up all of the money for the purchase of a stock while Party B, without putting up any capital, agrees that at a future date it will receive any gain or pay any loss that the bank realizes and thus no margin is being paid upfront. In these ill founded transactions bank members earn a commission for the risk they are undertaking. Thus banks and financial institutions are more at a receiving end if market falls drastically and other party refuses to oblige. This scheme has led to number of banks and financial institutions collapse.

Most Read Content