Securities and loss on the exchange rate of securities
In Russia, the Central Bank market was formed. It is regulated by legal and economic methods. The legal aspect is regulated by the Civil Code of the Russian Federation, which establishes the rules of work and the required forms of maintaining this type of business, mandatory requisites, reporting forms. The possibility of transferring the rights of doing business can be made only if the required documentation is available. But the loss on the exchange rate is possible with any legislative framework.
There are two forms of their release:
- CB issuing securities, may be uncertificated,are determined by the following characteristics: a) property and non-property rights are certified according to the current legislation, b) are realized with the same terms and volumes in one issue; the time of purchase does not matter, c) the placement occurs on issues.
- Central Bank non-issue, are issued in small series or individually.
The Central Bank, by right of possession, is divided into order, nominal and bearer;
- the order CB, in which the affiliation is indicated in itself;
- a registered Central Bank, in which the owner's name is inscribed on the letterhead or in the register. It happens in written and electronic form;
- CB bearer, does not specify the buyer and does not require identification. They do not maintain a registry.
Nowadays, many make pledge of securities. The valuation will be made below the market value, so there may be a loss on the course. Work with the Central Bank is unsafe, there are various risks. For example:
- With a decrease in the liquidity of the Central Bank, there is a possibility of a reduction in their value in the subsequent sale, in some cases the realization is much lower than the cost price;
- with the bankruptcy of the issuer;
- With a worsening of the market conditions, securities are becoming cheaper.
If there is a loss on the exchange rate, try to make it minimal.
The opportunity to lose investments in the stock market was called "portfolio risk." Loss on the exchange rate is quite likely, it can happen due to circumstances beyond your control.
There are such types of securities market:
1. Primary, where only issued securities are sold.
2. Secondary, where securities are already resold, it is more speculative.
The exchange rate fluctuations of the Central Bank in the stock market occur constantly. If their value increases - the number of sales decreases, with a decrease in price - increases. The CBA rate is influenced by many factors;
- speculative, when shareholders themselves buy up their shares, thereby increasing their value;
- objective, depend on the state of finances of the owner of the shares, the current profit of the firm, the value and number of shares, on the rate of increase in the liquidity of the joint-stock company;
- subjective, they include the technical component of trade, as well as the number of securities on the market.
The degree of risk from investing money, liquidity and profitability are the most important components that should be taken into account when working in this market.
We must always remember that the loss on the course of valuablepapers can arise at any time. Be balanced and reasonable in every action. Carefully analyze the situation on the market. Properly define your investment portfolio. Skillful trading in the securities market can increase well-being.