Synthetic and Structure Assets

Chapter One

Financial activities have been a part of the global economic framework for centuries. Lending, borrowing, speculating, investing, and hedging, for instance, have been employed for years by a broad range of institutions in order to achieve specific financial goals. Not surprisingly, as forces of deregulation, technology, and capital mobility have taken firmer root in the landscape of the late 20th and early 21st centuries, the financial marketplace has evolved, becoming increasingly useful, efficient, and sophisticated. It is now common for institutions, which once relied on basic capital-raising and investment instruments, to turn to a range of highly customized, though eminently practical, assets and liabilities in order to achieve desired goals. Our aim in this text is to examine many of these customized instruments, demonstrate how they have developed and evolved, and consider how they function mechanically, and in practice.

Our target sector can be classified in a num ... read full excerpt from Synthetic and Structured Assets ebook