Presented by:

Shantin

What is money market ?• Money markets is a market for short term funds having a maturity less than one year.

What is capital market?

Capital market is a market where long term funds are available.

What is International Capital Markets?• International Capital markets serve as links between the capital markets of individual countries.

What is Foreign Investment? Foreign investment is defined as the

purchase of assets in country by the residents of another country. It is usually divided into two categories:

Foreign Direct Investment (FDI)Foreign Portfolio Investment

Methods of portfolio investments ?1)Foreign Institutional Investors (FII)

2)Through Global Depository Receipts (GDRs), American Depository Receipts (ADRs) and Foreign Currency Convertible bonds (FCCBs).

Foreign Investment

Direct Investment Portfolio investment

Subsidiary Joint venture Acquisition

Investment by FII

Investment in GDRs,ADRs,FCCBs, etc

How capital is raised through Equity shares? By issuing shares, which are listed on the foreign stock exchanges

Through the issue of American Depository Receipts (ADRs), or European Depository Receipts (EDRs) or Global Depository Receipts.

What is Euro bond?Euro bond is defined as an international bond, underwritten by an international syndicate, and sold in countries other than the country of the issue.

American Depository Receipt (ADR)

• ADRs are the certificates (or receipts), denominated in dollars issued by a US bank, on the basis of a foreign equity it holds in custody.

American depository Shares (ADS)

ADS are also the stock ownership certificates issued in the US by a transfer agent or a trustee acting on behalf of foreign issuer.

Global Depository Receipts (GDRs)

Global depository Receipts is a dollar denominated instrument traded on stock exchange in Europe or the US or both.

Each GDR represents a certain number of underlying equity shares.

Private Placement Markets• Private placement is the sale of debt or equity to a large investor.

What is exchange rate? • The number of units of one currency, needed to acquire one unit of another currency

What is cross rate?• An exchange rate computed from two other non-dollar currencies

What is spot market• The spot market is the difference between the bid and offer rate quoted by the foreign-exchange trader.

What is inter bank market?

It is the foreign exchange market among commercial banks

Sources of International Capital ?

International Capital MarketsMulti national CompaniesForeign AidCommercial Bank Loans

Which is the largest stock exchange in the world?

• New York Stock Exchange (NYSE)

(by dollar volume with 2,764 listed securities)

Present scenarioThe United States is the world's number one recipient and provider of foreign direct investment

The vast majority of investment flowing to the developing world is received by a few countries (China, Brazil, Mexico, and Argentina)

China receives roughly one-third of these investments