Stocks and bonds are traded in separate markets, and interest rates are set in bond (debt) markets. Why then does there seem to be a direct relationship between the movements of stock prices and interest rates?

Q: Which theory of the term structure proposes that bonds of different maturities are not substitutes…

A: Holding money in the form of cash has the benefits of providing liquidity and meeting transactional…

Q: What is the difference between the dealer and the broker in the stock market? (Explain clearly.)

A: Broker:   A broker is a person who will buy and sell securities for their client.   Dealer:   A…

Q: In what ways is preferred stock like long-term debt? In what ways is it like equity?

A: Preferred stocks are issued to raise capital for the firm. Other forms of fund raising methods are…

Q: ted at on the financial sta

A: Earning per share refers to the concept of computing the per-share profit gained by a company on…

Q: What are the similarities and differences in equity valuation and bond valuation?

A: Bonds: Bonds are a debt instrument on which interest is paid. They can be issued at a discount/par…

Q: Why the financial instruments do often called derivatives?

A:

Q: Stocks and bonds are traded in separate markets, and interest rates are set in bond (debt) markets.…

A: Stocks and bonds are two types of financial instruments that represent ownership or a claim on…

Q: Stocks and bonds are traded in separate markets, and interest rates are set in bond (debt) markets.…

A: The objective of the question is to understand the inverse relationship between the movements of…

Q: What are the pros and cons of dealer markets (e.g. - treasury bond markets) as compared to trading…

A: The financial market known as a "dealer market" is where dealers list the prices at which they would…

Q: What are the similarities and differences between an overall rate and an equity dividend rate?

A: Answer: Equity is nothing but the difference between asset owning values and liabilities against…

Q: What is the main reason for the yield differences between treasury bond yield and corporate bond…

A: A treasury bond is issued by the government and is backed by the treasury whereas a corporate bond…

Q: How is preferred stock similar to long-term debt? How is it comparable to equity?

A: The Answer :

Q: Which of the following is a characteristic of a money market financial instrument?

A: Money market financial instruments are those instruments which have short maturity period of up to a…

Q: Discuss how market interest rates are affected by borrowers’ need for capital,expected inflation,…

A: The market interest rates are subject to several customer-related variables, including capital…

Q: How do money markets and capital markets differ? Identify the types of securities traded in money…

A: Short-term debt is traded on the money market. Governments, businesses, banks, and other financial…

Q: Explain the roll of debt and equity markets in the economy. How do they interact with both Primary…

A: Debt and equity market play a vital role in the economy. The market where investors and traders meet…