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High School Financial Education Program Florida International University College of Business http://business.fiu.edu/sf

High School Financial Education Program Florida International University College of Business http://business.fiu.edu/sffll 305-348-1542. Financial Products. Recap What types of markets do they trade on? What are the financial products available to me? Are there fees to investing?

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High School Financial Education Program Florida International University College of Business http://business.fiu.edu/sf

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  1. High School Financial Education Program Florida International University College of Business http://business.fiu.edu/sffll 305-348-1542

  2. Financial Products • Recap • What types of markets do they trade on? • What are the financial products available to me? • Are there fees to investing? • What are the risks? • Can you give me a taste of derivatives? • Showtime!

  3. Recap • Types of markets • A bit of economics • What is the purpose of the financial industry? • What kind of market is the flea market? • My mom matches people that want to buy boats with sellers of boats. What is she? • I put in ad on a website. What kind of market is this?

  4. Money Market • Very liquid • Near-Cash instruments • Less than one year • Low default risk • Lower rates of return

  5. US Treasury • Treasury bill (T-Bill) • Treasury note • Treasury Bond • Very liquid, practically cash • Can be bought directly from the Treasury

  6. Treasury Risk • Very few risks • Price risk • Inflation • Default risk- practically zero

  7. Commercial Paper • Issued by corporations with very high credit rating • Up to 270 days maturity in order to avoid registration • Minimum investment $100,000 • For short-term corporate investments

  8. CP Risks • Default Risk • Price risk • Inflation risk

  9. Recap and Questions • Recap • Money Market vs. Capital Market • Treasury instruments • Commercial paper • Any questions?

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