Agarwal & Saxena Interview Questions and Answers

Financial instruments are tradable assets that represent a legal agreement between two parties to buy or sell an asset at a predetermined price and time.

• Financial instruments include stocks, bonds, options, futures, and derivatives.

• Asset classes are groups of financial instruments that share similar characteristics and behave similarly in the market.

• Examples of asset classes include equities, fixed income, commodities,...read more

The primary market is where new securities are issued and sold for the first time.

• It is the market where companies raise capital by issuing new stocks or bonds.

• Investors can purchase these securities directly from the issuing company.

• Examples include initial public offerings (IPOs) and corporate bond offerings.

The secondary market refers to the financial market where previously issued securities are bought and sold.

• It is a market where investors can trade securities that have already been issued.

• It provides liquidity to investors by allowing them to buy and sell securities after their initial issuance.

• The secondary market includes stock exchanges, bond markets, and other platforms where securities are traded.

• Investors can bu...read more

Futures and options are financial derivatives that allow investors to speculate on the future price movements of an underlying asset.

• Futures contracts are agreements to buy or sell an asset at a predetermined price on a specified future date.

• Options contracts give the holder the right, but not the obligation, to buy or sell an asset at a predetermined price within a specified period.

• Both futures and options are commonl...read more

The derivative is a mathematical concept that represents the rate of change of a function at a particular point.

• The derivative measures how a function changes as its input changes

• It is defined as the slope of the tangent line to the graph of the function at a given point

• The derivative can be used to find the maximum and minimum values of a function

• It is commonly used in calculus to solve problems involving rates of cha...read more

There are several types of trade, including international trade, domestic trade, wholesale trade, and retail trade.

• International trade involves the exchange of goods and services between countries.

• Domestic trade refers to the buying and selling of goods and services within a country.

• Wholesale trade involves the sale of goods in large quantities to retailers or other businesses.

• Retail trade involves the sale of goods to...read more

Capital market deals with long-term securities while money market deals with short-term securities.

• Capital market is a market for long-term securities such as stocks, bonds, and debentures.

• Money market is a market for short-term securities such as treasury bills, commercial papers, and certificates of deposit.

• Capital market is used for raising long-term funds for investment in fixed assets.

• Money market is used for shor...read more

Changes in share purchasing and selling

• Introduction of online trading platforms

• Implementation of circuit breakers to prevent extreme price fluctuations

• Introduction of transaction taxes in some countries

• Increased use of algorithmic trading

• Regulatory changes to increase transparency and prevent insider trading

Calculation of brokerage is based on the percentage of the transaction value.

• Brokerage is calculated as a percentage of the transaction value

• The percentage may vary depending on the type of security being traded

• For example, the brokerage for equity shares may be different from that of mutual funds

• Brokerage may also be subject to a minimum and maximum limit

• The brokerage amount is deducted from the investor's account

• The ...read more

KYC is the process of verifying the identity of a customer while AML is the process of preventing money laundering.

• KYC is focused on identifying and verifying the identity of a customer

• AML is focused on preventing money laundering and terrorist financing

• KYC is a prerequisite for AML

• KYC involves collecting and verifying customer information such as name, address, and identification documents

• AML involves monitoring custo...read more

KYC is used to verify the identity of customers while AML is used to detect and prevent money laundering.

• KYC is used to ensure that financial institutions are not used for illegal activities.

• AML is not used in some areas because those areas may not have a high risk of money laundering.

• KYC is mandatory in many countries for financial institutions to comply with regulations.

• AML is used in areas where there is a high risk...read more

AML is used in financial institutions to prevent money laundering, while it is not commonly used in other industries.

• AML is used in financial institutions to detect and prevent money laundering and terrorist financing.

• It involves the identification and verification of customers, monitoring of transactions, and reporting of suspicious activities.

• AML is not commonly used in other industries, although some may have simila...read more