【正文】 ividuals and families and lending those funds to home buyers. ? Later, petition from other financial institutions, deregulation, and many failures, forced Samp。Ls) are among the largest of all thrift institutions, accepting deposits and extending loans and other services primarily to household customers. ? Samp。Money and Capital Markets 16 C h a p t e r Eighth Edition Financial Institutions and Instruments in a Global Marketplace Peter S. Rose McGraw Hill / Irwin Slides by YeeTien (Ted) Fu Nonbank Thrift Institutions: Savings amp。 Loan Associations, Savings Banks, Credit Unions, and Money Market Funds ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 2 Money and Capital Markets 17 C h a p t e r Eighth Edition Financial Institutions and Instruments in a Global Marketplace Peter S. Rose Slide by YeeTien (Ted) FuMutual Funds, Pension Funds, Insurance Companies, Finance Companies, and Other Financial Institutions ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 3 ? Learning Objectives ? ? To explore the many roles played by mutual funds, pension funds, insurance panies, finance panies, mortgage banks, and security dealers. ? To discover the different services they offer. ? To examine their principal sources and uses of funds. ? To understand the key problems they face today. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 4 Mutual Funds (Investment Companies) ? Mutual funds, or investment panies, direct the savings of individual investors into bonds, stocks, and money market securities. ? A small saver who buys mutual fund shares gains opportunities for capital gains and indirect access to higher yielding securities that can be purchased only in large blocks, and yet still enjoys price stability, low risk, and high liquidity. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 5 Mutual Funds (Investment Companies) ? Investment panies first developed in the ., and then made their appearance in the . in 1924 as a vehicle for buying and monitoring subsidiary corporations. ? Since then, the traditionally stockinvesting industry has seen many innovations – bond funds, money market funds, index funds, global funds, vulture funds, small/mid/largecap investment panies, and hedge funds. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 6 Mutual Funds (Investment Companies) ? Investment panies have a favorable tax situation – they pay no federal taxes on ine generated by their security holdings, provided their earnings flow through to their customers. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 7 Mutual Funds (Investment Companies) ? Openend investment panies, or mutual funds, buy back (redeem) their shares any time the investor wishes, and sell shares in any quantity demanded. ? The price of each openend pany share is equal to the asset value of the fund – that is, the difference between the values of its assets and liabilities divided by the volume of shares issued. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 8 Mutual Funds (Investment Companies) ? Closedend investment panies sell only a specific number of ownership shares, which usually trade on an exchange. ?They offer “double discounts” – discounted prices on the stocks they hold and discounted share prices to buy into the fund itself. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 9 Mutual Funds (Investment Companies) Source: Board of Governors of the Federal Reserve System 17 ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 10 Mutual Funds (Investment Companies) ? Investment panies adopt many goals. ? Growth funds invest mainly in mon stocks offering strong growth potential to achieve longterm capital appreciation. ? Ine funds typically purchase stocks and bonds paying high dividends and interest to gain current ine. ? Balanced funds acquire bonds, preferred stock, and mon stock that offer both capital gains (growth) and current ine. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 11 Mutual Funds (Investment Companies) ? It is not clear if mutual funds hold a significant advantage over other investors in seeking the highest returns available in the financial marketplace. ? With the possible exception of index funds, these panies may roll over their portfolios too rapidly, running up the cost of managing the fund and reducing earnings. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 12 Pension Funds ? Pension funds protect individuals and families against loss of ine in their retirement years by allowing workers to set aside and invest a portion of their current ine. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 13 Pension Funds ? Defined benefit plans promise a specific monthly or annual payment to workers when they retire based upon the size of their salary during their working years and their length of employment. ? Such programs have the advantage of guaranteed ine, but an employee who leaves early or is dismissed before retirement may get lit