Different Ways of Investing and Tracking Your Money

Different Ways of Investing and Tracking Your Money

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The Concept of Investment Banking Every now and then, time and again we have heard so much about investment banking and investment banking companies. But most of us do not bother to look up even on the internet as to what an investment bank is and what its functions are. Investment banking is that vertical of the financial sector where the said banks are said to be like the mediators or the middlemen when any business or a company wants to gain financial security. They usually buy and sell securities from and to companies and governments and resell to the public. www.avendus.com/india

A Big Responsibility One of the major responsibilities bestowed upon the investment banks is the process of underwriting. It is a process in which the lender assesses the actual credit worthiness of the customer. It is like a process which an investment banker or the investment banking companies sell on behalf of their clients. They usually buy from customer at a little lower price and then later sell it at high price. Therefore, underwriting is an assurance where the bank promises to bear the risk in case of any price inflation.

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The Function of Underwriting Underwriting is a process through which a lender of any other lending institute assesses the credit worthiness of a customer. It can also be said to be the process in which the investment banker packages and sells the security on behalf of its client. He or she will buy the security from the customer at a lower price and then sells it later at a higher price. This way hence, underwriting is like an insurance where the banker may bear the risk of adverse price fluctuation during the period of distribution. Even if they do not manage to sell the security at a specific price, it would be the underwriter who’d suffer losses. www.avendus.com/india

Distribution One of the other major key roles that the investment banks perform is that of distribution. In this, they market new securities that are issued. Once they get those securities, it is on them to give it to the investors. As they hold specialization in distribution of securities, they also perform physical distribution functions more efficiently. This way is more economical that in an individual company.

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The Other Route Other than relying on investment banking, companies can also rely on wealth management companies to keep as to keep a track of their current wealth status. Wealth management is a vertical in which the firms get to expand their wealth judiciously and keep a close watch on the performance of their investments. The investment management firms believe in the motto of keeping their clients ahead of their own interests.

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Do a Background Check However, if you are very new to the whole idea of investment and wealth management as a business, then it is very important that you choose your asset management company very meticulously. This is because you are going to be trusting them with your very hard-earned profits.

Therefore, do a background check, look at the businesses they worked with earlier and get reviews from people in the field.

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Thank You

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