What are the investment banking business?

Investment banking business mainly includes:
I securities underwriting. Securities underwriting is the most original and basic business activity of investment banks. The investment bank has a wide range of powers, including bonds issued by the central government, local governments, and government agencies, stocks and bonds issued by enterprises, securities issued by foreign governments and companies in their own and the world, and securities issued by international financial institutions. During the underwriting process, investment banks generally should weigh whether the underwriting amount and risk are to form a underwriting cindica and choose the underwriting method. There are four types of underwriting methods:

The first: package sales. This means that the main underwriter and its Cindicagan members agreed to purchase all securities issued and issued at the agreed price, and then sell these securities to their customers. At this time, the issuer did not bear the risk, and the risk was passed on to the investment bank.

The second type: bidding for purchase. It is usually carried out in the case where investment banks are passive competition. Securities that use this distribution method are usually bonds with high credit and popular investors.

The third type: agency sales. This is generally caused by the low credit rating of the securities and the risk of underwriting. At this time, the investment bank only accepted the entrustment of the issuer to act as its sales securities. If the securities issued in the specified period plan were not sold, the remaining part returned to the securities issuer. The issuer was borne by the issuer himself.

The fourth type: sponsorship sales. When the issuing company increases its capital and expansion, its main target is the existing shareholders, but it cannot ensure that the existing shareholders subscribe to their securities. In order to prevent difficulty in raising the required funds in time, it has even caused the company's stock price to fall. Investment banks should be entrusted to handle the work of issuing new shares to existing shareholders, thereby passing risks to investment banks.

: Securities brokerage transactions. Investment banks play a triple role in market, brokers and dealers in the secondary market. As a market businessman, after the end of the securities underwriting, the investment bank has the obligation to create a secondary market with strong liquidity for the securities and maintain the stability of market prices. As a broker, the investment bank represents the buyer or the seller, and the transaction is traded at the price agency proposed by the customer. As a dealer, investment banks have the needs of self -employed trading securities. This is because investment banks are commissioned by customers to manage a large amount of assets, and they must ensure the preservation and value -added of these assets. In addition, investment banks also conduct activities such as risk -free arbitrage and risk arbitrage in the secondary market.

Court of private equity issuance. The issuance of securities is divided into two types: public offering and private equity issuance. The previous securities underwriting is actually issued by public offerings. Private equity issuance, also known as private issuance, is that issuers do not sell securities to the public, but are sold to only limited number of institutional investors, such as insurance companies and common funds. Private equity issuance is not limited by the rules of public issuance. In addition to saving the time of issuance and the cost of issuance, it can also bring higher yields to investors and investors than securities that trades the same structure on the open market. Therefore, in recent years, in recent years The scale of private equity issuance is still expanding. However, at the same time, the lack of private equity issuance has poor liquidity, narrow issuance, and difficulty in publicity and expanding the popularity of enterprises.

⑷ merger and acquisition. Enterprise mergers and acquisitions have become the most important business components of modern investment banks except securities underwriting and brokerage business. Investment banks can participate in the corporate mergers and acquisitions in various ways, such as: finding objects that merge and acquisitions, provide consulting prices or non -price clauses to hunter companies and prey companies, help hunter companies formulate mergers and acquisitions plans or help prey companies targeting the prey company to target Mysterious acquisitions formulate anti -acquisition plans, help arrange financial communication and bridge loans. In addition, the issuance of "junk bonds" in mergers and acquisitions often includes activities such as "junk bonds", corporate reorganization and asset structure reorganization.

⑸ Project financing. Project financing is a technical means to financing a specific economic unit or project planning. guarantee. Investment banks play a very critical role in project financing. It will closely linked the project -related government agencies, financial institutions, investors and project initiatives, etc., and coordinate lawyers, accountants, engineers, etc. , And then organize the funding of project investment by issuing bonds, funds, stocks or borrowings, auctions, mortgage loans and other forms. The main work of investment banking in project financing is: project evaluation, financing plan design, drafting of relevant legal documents, relevant credit rating, securities prices and underwriting.

⑹ Company financial management. The company's financial management is actually a consulting, planning or operation of the investment bank as a financial consultant or business management consultant. It is divided into two categories: the first category is to conduct in -depth research and analysis of a certain industry, a certain market, a certain product, or securities in accordance with the requirements of the company, individuals, or the government. Data; the second category is to help enterprises make suggestions when they encounter difficulties in business operations and put forward response measures, such as formulating development strategies, rebuilding the financial system, and selling transfer subsidiaries.

⑺ fund management. Fund is an important investment tool. It is organized by the fund initiator to absorb a large number of investors' scattered funds. Experts with special knowledge and investment experience are hired to invest in investment and obtain income. Investment banks are closely related to funds. First of all, the investment bank can be the initiator of the fund to initiate and establish a fund. Essence

⑻ Financial consultant and investment consulting. The financial advisory business of investment banks is the general term of the planning and consulting business of a series of securities market business undertaken by investment banks, especially listed companies, especially listed companies. It mainly refers to the professional financial opinions provided by investment banks in the company's joint -stock system, listing, re -funding in the secondary market, and major trading activities such as mergers and acquisitions, and sale of assets. The investment consulting business of investment banks is the link and bridge of first -level and secondary markets, communicating with investors, operators and securities issuers in the securities market. It is used to the scope of investment consulting business in providing investment opinions and management services to participating investors participating in the secondary market.

⑼ Asset securitization. Asset securitization refers to the issue of securities issued by an investment bank with a certain assets of a company as a guarantee. It is a new type of financing method that is very different from traditional bonds. The company that conducts asset transformation is called the initiator of asset securities. The sponsor will classify the various financial assets with poor liquidity, such as housing mortgage loans, credit card receivables, etc., and sort out a batch of asset portfolios and sell them to specific trading organizations, that is, buyers of financial assets (mainly because of mainly financial assets (mainly because of mainly financial assets (mainly because of mainly financial assets (mainly due to financial assets Investment banks), then a specific transaction organization uses the financial assets to guarantee the issuing assets to support securities to recover the purchase of funds. This series of processes is called asset securitization. Asset securitization, asset securities, asset securities are various types of debt bonds, mainly in the form of commercial bills, medium -term bonds, trust vouchers, preferred stocks, etc. Buyers and holders of asset securities can get the principal and interest payment when the securities expire. Securities payment funds come from the cash flow created by guaranteed assets, that is, the principal and interest of the repayment of the asset debtor repaid. If the guarantee asset defaults to refuse to pay, the settlement of asset securities is limited to the amount of the assets of the securitization, and the initiator of the financial asset may not exceed the settlement of the asset limit.

⑽ Financial innovation. Depending on the characteristics, financial innovation tools, that is, derivatives are generally divided into three categories: futures, options, and futures categories. There are three strategies for using derivatives, namely arbitrage preservation, increasing returns and improving investment management of securities. Through the establishment and transaction of financial innovation tools, investment banks have further expanded the business space and capital income of investment banks. First of all, investment banks buy and sell such financial instruments as agent agents and collect commissions; second, investment banks can also obtain a certain price difference, because investment banks often first use the other party to buy and sell derivatives, and then look for another customer Instead of replacement transactions; third, these financial innovation tools can also help investment banks perform risk control to avoid losses. Financial innovation also breaks the boundaries between banks and non -banks, commercial banks and investment banks in the original institutions and the traditional market division, which exacerbates competition in the financial market.

⑾ Investment. Risk investment, also known as entrepreneurial investment, refers to the financial communication of emerging companies in the entrepreneurial and expansion period, which is manifested as high risk and high income. Emerging companies generally refer to companies that use new technologies or new inventions, production of new products, have a large market potential, and can obtain profits that can get much higher than the average profit, but are full of great risk. Because of high risk, ordinary investors are often unwilling to get involved, but such companies need the support of funds most, so they provide broad market space for investment banks. Investment banks have different levels of risk investment: first, the use of private equity methods to raise capital for these companies; second, some companies with huge potentials sometimes make direct investment and become their shareholders; third, more investment in investment; third, more investment Banks set up "risk funds" or "entrepreneurial funds" to provide the source of funds to these companies.