1. STOCKS Securities*: -Stocks – equity financing -Bonds – debt financing -money market instruments: (derivatives, futures, options) -* vrijednosnice, vrijednosni papiri

2. STOCKS & SHARES (1) 1. Most companies begin as ……………. limited companies. 2. If they want to grow they must ………. capital. 3. One way to obtain capital for growth is to ……….., i.e. apply to the stock exchange to become a public limited comp. 4. Smaller or newer companies usually sell their shares on the ………….……. markets. private raise go public over-the-counter

3. REVISION FOUR TYPES OF ORGANISATIONS IN THE PRIVATE SECTOR 1) WITH UNLIMITED LIABILITY __________________ ______________ 2) WITH LIMITED LIABILITY ___________________ Sole proprietorship Partnership Private limited company Public limited company

4. REVISION LIMITED vs. UNLIMITED LIABILITY FOR DEBT In businesses with limited liability, owners are responsible* for their company’s debts up to a certain amount if it goes out of business, and do not have to sell their personal assets to repay the debts. * ______ Source: Longman Business English Dictionary liable

5. LIMITED COMPANIES a legal ______ (independent legal existence from its shareholders) shareholders have limited liability (liable for the amount of capital ________) in case of bankruptcy, assets are __________ and the company is wound up. entity invested liquidated

6. LIMITED COMPANIES owners put ___ the capital (divided into shares) shareholders can _______the AGM and take a share of the profit through dividend shareholders elect a _______________ and a Chairperson the BoD ________managers to run day-to-day business documents which need to be ________ : the Memorandum of Association and Articles of Association Registrar of Companies issues a Certificate of Incorporation up vote at Board of Directors appoint drawn up

7. PRIVATE →PUBLIC LIMITED COMPANY FLOTATION / IPO / GOING PUBLIC change a private company into a public company by issuing shares and soliciting the public to purchase them  The bank has closed its initial public offer early because of overwhelming demand from investors.  The price of the company’ shares on the day it floated on the stock market beat all expectations.  Investors expected the share price to rise steeply after the company went public.  Source: Longman Business English Dictionary  MK, p 87: Reading Stocks and Shares

9. STOCKS & SHARES (2) 5. Issuing shares for the first time is known as ………… a company (making a …….........) or _ _ _. 6. To guarantee to purchase all the securities at an agreed price on a certain day, if they cannot be sold to the public: …………….. floatingflotation I P O to underwrite

10. VOCABULARY Companies going public… i____ shares a_____ to a stock exchange j____ over-the-counter market a____ to be quoted or listed on a stock exchange f_____ a large number of requirements u___ an investment bank to u________the issue ssue pply oin pply ulfill senderwrite

11. Synonyms British English companies shares/stock EQUITIES shareholders ordinary shares preference shares flotation Annual General Meeting Articles of Association Memorandum of Assoc. authorised share capital property American English corporations stocks stockholders common stock preferred stock initial public offering Annual Stockholders M. Bylaws Certificate of Incorporation authorized capital stock real estate

13. Security (finance)...... a financial investment such as a bond, a share/stock or a d _ _ _ _ _ _ _ _ _.

14. Security (finance)...... a financial investment such as a bond, a share/stock or a d e r i v a t i v e.

15. Derivatives MK, U 18, p 92

16. DERIVATIVE (finance) something such as an option, or a future, based on underlying assets such as shares, bonds, and currencies. Longman Business English Dictionary Cro = derivat, derivatni instrument, izvedenica

17. Derivative: A security whose price is d_ p _ _ _ _ _ t upon or d_ _ _ _ _ d from one or more underlying assets. The derivative itself is merely a contract between two or more parties. Its value is determined by f _ _ _ _ _ _ _ _ _ s in the underlying asset. The most common u _ _ _ _ _ _ _ _ g assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage. http://www.investopedia.com/terms/d/derivative.asp

18. MK, p 92 Vocabulary 1F2A3E4D5C6B7H8G Investopedia explains Derivative Futures contracts, forward contracts, options and swaps are the most common types of derivatives. Derivatives are contracts and can be used as an underlying asset. There are even derivatives based on weather data, such as the amount of rain or the number of sunny days in a particular region.