标题: What is the right answer.. [打印本页] 作者: Mechanic 时间: 2011-7-13 13:12 标题: What is the right answer..
A secondary market activity is...
Shelf offering or
An investment banker selling the governament security (like bills, notes, and bonds) to other?
Dont remember the first choice..
Thx作者: kasinkei 时间: 2011-7-13 13:12
Good for u作者: chetan86 时间: 2011-7-13 13:12
Aravinda Wrote:
-------------------------------------------------------
> A secondary market activity is...
>
> Shelf offering or
> An investment banker selling the governament
> security (like bills, notes, and bonds) to other?
>
>
> Dont remember the first choice..
>
> Thx
I would say an investment banker selling the government security is a secondary activity. If the government securities are already in possession of the investment banker, then they have already been sold into the open market. Once it is out of the hands of the originator, in this case, the U.S. government, every transaction thereafter is a secondary market activity.
FYI: A shelf offering consists of shares of stock that have yet to be sold by an investment bank. In other words, the investment bank who is underwriting the IPO keeps some shares "on a shelf" to sell into the market after the share price has gone up.作者: eagles_dare13 时间: 2011-7-13 13:12
I went for shelf registration - I can't remember the alternatives or the question clearly enough, but my feeling was that as shelf registrations were held back pieces of rights issues of listed companies they were effectively secondary market securities.
An investment banker selling a government security may be a secondary activity - i.e not originating - but that doesn't necessarily make it a secondary MARKET activity.
Still, not comfortable with this one - I may well be wrong.作者: soddy1979 时间: 2011-7-13 13:12
I said Investment bank too.... I believe Shelf Reg. is one of the features of a primary markets作者: Jolyn 时间: 2011-7-13 13:12
I'm pretty sure I said the ibanker selling govt securities.作者: dmar 时间: 2011-7-13 13:12
There were so many questions, which had an answer in "grey" area. I really don't understand that what was point of CFA institute in asking such ambigious questions作者: dotamasta 时间: 2011-7-13 13:13
Can you put the question up pls..作者: soddy1979 时间: 2011-7-13 13:13
I'm not sure, but shelf offering offers you to sell securities whenever you want to when needed (they are on the shelf basically), so this fits well.
...but in the exam I answered "Investment Banker selling Gov't securities" as i-bankers usually dont sell govt securities (the govt sells them itself).
...but, i-bankers are the biggest primary market makers, so Im not sure where this fits with selling govt securities, but u get the point.
confused? so am I.作者: eagles_dare13 时间: 2011-7-13 13:13
Also found this:
"Shelf registration provides an institutionalized method to issue a secondary offer instantly. Once the shelf registration statement has been filed, the seller typically will receive calls from time to time from a variety of investment banking firms offering to buy securities at a given set of terms and price."
So, i guess shelf registration.作者: ramzes 时间: 2011-7-13 13:13
bankers selling EXISTING government securities that they already own...aka TRADING THEM on the second market. everything else was PRIMARY market.
the ibanker one was SECONDARY market activity作者: draz 时间: 2011-7-13 13:13
billbelemy22, was that the wording, "securities that they already own"? Or was is simply "investment bankers selling govt securities"?
Govts use i bankers to sell securities - i bankers often act as underwriters or middlemen - in these cases they are not necessarily trading them on a secondary market - they are simply in these cases agents for the originator.
In the CFAI text, however, shelf registrations are discussed in the Primary Markets section, so while I don't think the distinction is clear enough in the text or that it was so in the exam, from this context alone I reckon Shelf was (rightly or wrongly) probably wrong.作者: RobertA 时间: 2011-7-13 13:13
ibankers DO NOT underwrite govt securities!
it said ibankers reselling or selling govt bonds. Ibanks have govt bond positions. when they sell them, they are selling them on the secondary markets.
both others were primary market activiites.
shelf registration is selling bond precleared to be sold on the primary market for hte FIRST TIME. they were simply registered to be sold, then put "on the shelf" when they are eventually sold it is a primary activity.
it was 100% the ibanker answer作者: siavosh 时间: 2011-7-13 13:13
Probably i banker was the answer.
I bankers may not underwrite govt securities, but they do assist in selling them - i.e. as agents, rather than secondary sellers.
Shelf registrations are not, incidentally, necessarily bonds - they are also issues of common stock. Only a company listed on a secondary market can make use of a shelf registration.
