What Are the Different Types of Funding for New Businesses?

Treasury business is the most important channel for the use of funds other than loans, and it is also an important source of funds for banks. After the bank obtains funds by absorbing deposits, issuing bonds, and absorbing shareholders' investment, in addition to issuing loans to obtain loan interest, the rest is used for investment transactions to obtain investment returns.

Treasury business

Treasury business

risk

The main risk of treasury business is

Treasury business can be divided into: long-term and short-term capital business

The asset management business generally refers to the asset entrusted management initiated by a securities operation agency, that is, the act of the client giving its assets to the trustee, and the trustee providing financial management services for the client.

Treasury Bank Assets Business

Bank asset business refers to the use of funds absorbed by banks to engage in various credit activities to obtain profits.

Bank asset business mainly includes two types of lending business and investment business.

Treasury Business Derivatives Business

Financial derivatives include: futures, interest rate swaps, currency swaps, options, cross currency currency swaps, structured foreign exchange derivatives and non-foreign exchange derivatives.

Futures: Futures are relative to the spot. Futures are the subject matter for trading now, but in the future, the subject matter for settlement or delivery. This subject matter can be a commodity such as gold, crude oil, agricultural products, financial instruments, or financial indicators. The date for settlement of futures can be one week later, one month later, three months later, or even one year later. A contract or agreement for buying and selling futures is called a futures contract. The place to buy and sell futures is called the futures market. Investors can invest or speculate in futures. Inappropriate speculation on futures, such as short selling out of stock, can lead to turbulence in financial markets.

Interest rate swaps: Interest rate swaps are based on a certain nominal principal, and the interest income (expenditure) flow generated by the principal with one interest rate is calculated with the other party's interest income with another interest rate. (Expenditure) phase. Only the interest of different characteristics is exchanged, there is no swap of substantial principal. Interest rate swaps can take many forms. The most common type of interest rate swap is conversion before fixed and floating rates.

Currency swaps: Currency swaps (also known as currency swaps) refer to the exchange of two debt funds of the same amount, with the same maturity, and the same method of calculating interest rates, but also with different interest amounts.

Option ( option contract ): also known as option, is a derivative financial instrument generated on the basis of futures. In essence, options essentially price and separate rights and obligations in the financial field, so that the assignee of rights exercises their rights as to whether or not to conduct a transaction within a specified time, and the obligor must perform. In the transaction of options, the party buying the option is called the buyer, and the party selling the option is called the seller; the buyer is the assignee of the right, and the seller is the obligor who must fulfill the buyer's exercise of the right.