Moving out of the center of the figure, the next mostperfect market is the sovereign debt instruments of their respective national
markets, which do not carry
Credit risk (only refers to market risk), 香港 家族办公室 usuallyextensive and continuous transactions. Of course, foreign debt instruments
purchased by foreign investors also carry foreign bonds
Foreign exchange risk and (arguably secondary) sovereigndebt default risk
foreign investor. If these sovereign debt instruments aredenominated in foreign currencies
Currency, they have both currency risk and country risk(risk of inability or unwillingness to repay foreign currency debts). Operation
of sovereign debt instruments
AAA rated bonds that can be traded in broad and deepmarkets
The road to non investment grade and highly speculative"rural garbage"
Next are state bonds, local bonds and corporate bonds,including AAA corporate bonds and municipal bonds traded in the liquid market
Slightly higher than sovereignty, up to high-yield noninvestment level
Unrated bonds. This category also includes asset-backedsecurities and syndicated bank loans, which may be repackaged and resold once
issued.
Then common shares of companies traded on the secondarymarket
Constitute a brokerage business. Equity securities arealso issued, underwritten and
Allocated by the investment bank. Between corporate bondsand stocks are hybrid financial instruments, such as convertible bonds,
preferred shares and warrants
Purchase securities at some time in the future, and thesesecurities will sometimes be "stripped"
And sold in the "secured warrant" market. Theperiphery of Figure 2.5 is
Venture capital and private equity, through the saleto another company or initial public offering (IPO
