Tricks and tips for everyone


What is available-for-sale financial assets?

What is available-for-sale financial assets?

Available-for-sale (AFS) is an accounting term used to describe and classify financial assets. It is a debt or equity security not classified as a held-for-trading or held-to-maturity security—the two other kinds of financial assets. AFS securities are nonstrategic and can usually have a ready market price available.

What are examples of financial instruments?

In simple words, any asset which holds capital and can be traded in the market is referred to as a financial instrument. Some examples of financial instruments are cheques, shares, stocks, bonds, futures, and options contracts.

What are the 5 financial instruments?

Thus, the, such as resources, currency, bonds, stocks, and stock indexes. The five most common examples of derivatives instruments are synthetic agreements, forwards, futures, options, and swaps.

What are the 6 financial instruments?

6 Important Financial Instruments to Make Your Financial Plan a…

  • Individual stocks.
  • Bonds.
  • Exchange-traded funds (ETFs)
  • Mutual funds and index mutual funds.
  • Certificates of deposits (CDs)
  • Real estate investment trusts (REITs)

What are the 4 types of financial assets?

Cash, stocks, bonds, mutual funds, and bank deposits are all are examples of financial assets. Unlike land, property, commodities, or other tangible physical assets, financial assets do not necessarily have inherent physical worth or even a physical form.

What is HTM HFT and AFS?

The investment portfolio of banks is classified under three categories, viz., ‘Held to Maturity (HTM)’, ‘Available for Sale (AFS)’ and ‘Held for Trading (HFT)’. Banks normally hold securities acquired by them with the intention to hold them up to maturity under HTM category.

What are financial instruments and products?


Asset class Instrument type
Securities OTC derivatives
Debt (long term) 1 year Bonds Interest rate swaps Interest rate caps and floors Interest rate options Exotic derivatives
Debt (short term) ≤ 1 year Bills, e.g. T-bills Commercial paper Forward rate agreements
Equity Stock Stock options Exotic derivatives

What are the new financial instruments?

New financial instruments such as floating rate bonds, zero interest bonds, deep discount bonds, revolving underwriting finance facility, auction rated debentures, secured premium notes with detachable warrants, non-convertible debentures with detachable equity warrants, secured zero interest partly convertible …

What are financial instruments?

What Is a Financial Instrument?

  • A financial instrument is a real or virtual document representing a legal agreement involving any kind of monetary value.
  • Financial instruments may be divided into two types: cash instruments and derivative instruments.

How do you list financial assets?

Types of Financial Assets

  1. Cash and Cash Equivalents. Cash and paper money, US Treasury bills, undeposited receipts, and Money Market funds are its examples.
  2. Accounts Receivable.
  3. Fixed Deposits.
  4. Equity Shares.
  5. Debentures/ Bonds.
  6. Preference Shares.
  7. Mutual Funds.
  8. Interests in subsidiaries, associates and joint ventures.

What is SLR holdings in HTM category?

At present, banks have been granted a special dispensation of enhanced Held to Maturity (HTM) limit of 22 per cent of Net Demand and Time Liabilities (NDTL), for Statutory Liquidity Ratio (SLR) eligible securities acquired between September 1, 2020 and March 31, 2022, until March 31, 2023.

What are SLR securities?

Statutory Liquidity Ratio or SLR is a minimum percentage of deposits that a commercial bank has to maintain in the form of liquid cash, gold or other securities. It is basically the reserve requirement that banks are expected to keep before offering credit to customers.

What are financial instruments in accounting?

A financial instrument is an investment that confers on its owner a claim on the income or change in value of the issuer, or some underlying component of the instrument. Financial instruments can usually be traded, thereby allowing for the efficient transfer of capital between investors.

Is a loan a financial instrument?

“A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.” “The definition is wide and includes cash, deposits in other entities, trade receivables, loans to other entities.

What are the three types of financial assets?

Money, stocks and bonds are the main types of financial assets. Each is something you can own, and each has some amount of financial value.

What is CRR at present?

The current CRR Rate is 4.50% Statutory Liquidity Ratio (SLR) : This portion is set aside by the banks in the form of liquid assets such as gold or RBI approved securities such as government securities.

What is Mclr?

MCLR (Marginal Cost of Funds Based Landing Rate) refers to the minimum interest rate below which financial institutions can’t lend, except in certain cases. Earlier, when banks and financial institutions did lend on base rates, its prime customers used to get undue advantages.

What is current SLR?

The current rates as per RBI Monetary Policy are: SLR rate is 18.00%, Repo rate is 4.90%, Reverse Repo rate is 3.35%, MSF rate is 5.15%, CRR rate is 4.50% and Bank rate is 5.15%.

What is SLR rate?

Reserve Ratio
CRR 4.50%
SLR 18.00%

What is difference between Mclr and RLLR?

As per RBI guidelines, the interest rates linked to RLLR are subject to revisions every 3 months. In other words, any change in the repo rate will reflect in a change in the RLLR of commercial banks every 3 months. The MCLR-linked loan rates, on the other hand, are revised once every 6 or 12 months.

What is the list of financial instruments?

List of Financial Instruments | Financial Management. List of financial instruments: 1. Equity 2. Fixed Income Securities 3. Derivative Securities 4. Structured Finance Securities 5. Participating Notes. 1. Equity:

What are examples of financial instruments in IAS 39?

Common examples of financial instruments within the scope of IAS 39 cash demand and time deposits commercial paper accounts, notes, and loans receivable and payable debt and equity securities. These are financial instruments from the perspectives of both the holder and the issuer.

What are the best financial instruments to trade on daily basis?

Foreign exchange market being the largest market in the world also comes with some of the best financial instruments that one can trade on a daily basis. The market accounts for more than $4 trillion in average daily volume. Foreign exchange is the art of trading currencies by merely taking advantage of changes in currency pair prices.

What are the asset classes of financial instruments?

Asset Classes of Financial Instruments 1 Debt-Based Financial Instruments#N#Debt-based financial instruments are categorized as mechanisms that an entity can… 2 Equity-Based Financial Instruments More

Related Posts