Non-financial businesses are enterprises formed by individuals and other businesses to engage in activities for profit, where the activities are not primarily those of financial intermediaries such as commercial banks. These businesses issue debt and equity instruments and invest in the financial markets.
Businesses participate as investors in financial markets by investing excess funds in the money market, as well as investing the funds of defined benefit plans they sponsor, as do state and local governments. Nonfinancial corporations are the largest defined benefit pension fund for businesses in the United States. The top five total assets in billions as of January 26, 2009 by pensions and investments are:
General Motors $91.0
AT&T $61.9
General Electric $50.0
IBM $49.4
Boeing $42.5
Some nonfinancial businesses have subsidiaries that engage in the same activities as financial corporations. Financial subsidiaries which we refer to as captive finance companies participate in the financial market by providing loans. Examples include Ford Motor Credit and General Electric Credit Corporation.
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- Finance
- Capital Markets and Capital Market Theory
- Financial Management
- Investment Management
- Financial System
- Role of Financial Markets
- Role of Financial Intermediaries
- Maturity Intermediation
- Risk Reduction via Diversification
- Reducing the Costs of Contracting and Information Processing
- Regulating Financial Activities
- How many types of financial markets are there?
- It is the lowest maturity money market instrument
- Functioning of capital markets
- What is Derivative in Financial Markets?
- What is primary market in finance?
- What is the secondary market in finance
- Among the important characteristics of market efficiency is…
- Characteristics of an economic system that create economic opportunity
- Domestic Non Economic Sectors
- The Government Sector
- The Federal Government
- Government-Owned Corporations
- Government-Sponsored Enterprises
- State and Local Governments
- Designated non-financial businesses and professionals
- Distribution of gross domestic product (GDP) among economic sectors
- Depository Institutions - Depository institutions are the most diverse type
- No depository Financial Institutions
- Domestic financial insurance companies
- Financial investment companies
- Regulated Investment Companies
- Exchange Traded Fund Companies
- A hedge fund is a type of investment that involves investing
- Separately Managed Accounts
- Pension Fund Investment Management
- What do investment banks do?
- Private Placement of Securities
- Trading Securities
- Advising on mergers, acquisitions and financial restructuring
- Merchant Banking
- Securities, Finance, and Prime Brokerage Services
- Asset Management
- Financial sector of foreign investment
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