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self regulatory organizations (SRO)
provide oversight and enforcement for some rules
trade settlement
cash from the buyer’s brokerage account is transferred to the seller’s brokerage account
share ownership in a trade settlement
transferred from seller to buyer
underwriting
distributing shares
ETF
exchange traded funds
who is responsible for securities regulation
provincial
examples of SRO
CDS, CIPF, CSI
examples of investment dealers
small number of national scope, small “boutique”, multiple departments within
2 types of brokers
full service/discount
what do full service brokers offer
service/advice, high fees
what do discount brokers offer
limited services, no advice, low fees
risks with the borrow short and lend long strategy
if short term investment rates > long term, leads to recession
effects on evolution of tech/globalization to financial industry
increased market connections
what do principal investment dealers do in primary markets
agrees to price with issuer, buys all shares, sells shares to investors
what do agent investment dealers do in primary markets
markets the share to investors on best effort bases, does not repurchase
does investment dealer face more risk as an agent or principal?
principal because they use their own money
what do principal investment dealers do in secondary markets
invest their own capital, earn a spread between purchase and sale prices, proprietary/liability trading
what do agent investment dealers do in secondary markets
invest client’s capital, commission, brokerage
what happens after a trade is executed
CDS settles the trade, Registered owners have their name on the electronic share certificate, Shares in street form are registered in the name of the brokerage, Broker keeps track of individual client ownership
how do banks earn money
money from depositors - money lent to borrowers, revenue from lending, interest
the bank act
Schedule I: Domestic Banks
Schedule II: Subsidiaries of Foreign Banks
Schedule III: Branches of Foreign Banks
life insurance companies
match liabilities with assets, invest in long term fixed income products, insurers can own trusts and offer banking & investment products
property and casualty (P&C) insurance companies
covers liabilities that occur more frequently in a customers life
examples of investment funds
mutual/hedge funds, ETFs
closed end funds
listed on an exchange, fixed number of units outstanding, investors trade in a similar way as shares
open ended funds
not listed on an exchange, no fixed number of units outstanding, investors can only buy & redeem units from investment fund
what do pension plans do
match expected payoff of investments with the expected liabilities
what does the central repository do?
keeps track of who owns each share of a company
Note 
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