Tiếng anh chuyên ngành kế toán bài 5
Trang 1FINANCIAL MARKETS
UNIT OBJECTIVES - MỤC TIÊU
DURATION (9 periods) - THỜI LƯỢNG HỌC (9 TIẾT)
• Provide students with the language and knowledge related to the main types of financial markets
Cung cấp cho sinh viên vốn ngôn ngữ và kiến thức liên quan đến các loại hình thị trường tài chính cơ bản
• Provide students with the language and method to write an argumentative essay
Cung cấp cho học viên ngôn ngữ và phương pháp viết một bài bình luận
• At the end of this unit, students will be able to talk and write about the main types of financial markets, the main characters of each type and factors that affect the prices on financial markets
Sau khi kết thúc bài học này, sinh viên có thể nói và viết về các loại hình thị trường tài chính
cơ bản, những đặc điểm của từng loại là gì và những nhân tố nào ảnh hưởng đến giá cả trên những thị trường tài chính
In this unit, we will learn language and knowledge related to the main types of financial markets, the main characters of each type and the factors that affect the prices on financial markets
Trong bài này, chúng ta sẽ học ngôn ngữ và kiến thức liên quan đến các loại thị trường tài chính cơ bản, các đặc điểm chính của từng loại và các nhân tố có ảnh hưởng tới giá trên thị trường tài chính.
Trang 2Match each explanation in column A with its term in column B The suggested time for completing the exercise is 10 minutes
1 Having a responsibility or an obligation to do something, e.g
to pay a debt
A Assets
2 A person or an organization to whom money is owed (for
goods or services rendered, or as repayment of loan)
B Bankrupt
4 Everything of value owned by a business that can be used to
produce goods, pay liabilities, and so on to sell at the
posses-sions of a bankrupt business
D Dividend
5 To sell at the possessions of a bankrupt business E Founders
6 Money that a company will have to pay to someone else (bills,
taxes, debts, interest and mortgage payments, etc.)
F Liabilities
7 To provide money for a company or other project G Liability
8 Money invested in a possibly risky new business H Premises
10 The place in which a company does business: an office, shop,
workshop, factory, warehouse, and so on to guarantee to buy
an entire new share issue, if no one else wants it
J To put up capital
11 To guarantee to buy an entire new share issue, if no one else
wants it
K Underwrite
12 A proportion of the annual profits of a limited company, paid
to shareholders
L Venture capital
Trang 3Read the text and do the exercises below The suggested time for reading the text and completing the exercises is 30 minutes
HOW INVESTMENT TAKES PLACE How investment takes place
Afinancial market is a place where firms
and individuals enter into contracts to
sell or buy a specific product such as a stock,
bond, or futures contract Buyers seek to buy
at the lowest available price and sellers seek
to sell at the highest available price There
are a number of different kinds of financial
markets, depending on what you want to
buy or sell, but all financial markets employ
professional people and are regulated
Stock markets
Stock markets grew out of small meetings
of people who wanted to buy and sell
their stocks These men realized it was much
easier to make trades if they were all in the
same place at the same time Today people
from all over the world use stock markets to
buy and sell shares in thousands of different
companies
The act of issuing shares or stocks on the
stock market for the first time is known as
floating a company (making a flotation) In
America, new issues of stock must be
regis-tered with the U.S Securities and Exchange
Commission and in some cases with the State
of New York A prospectus, giving details
about a company's operation and the stock
to be issued is printed and distributed to
interested parties Companies generally use
an investment bank to underwrite the issue,
i.e to guarantee to purchase all the securities
at an agreed price on a certain day, if they
cannot be sold to the public
Companies wishing to raise more money for
expansion can sometimes issue new shares,
which are normally offered first to existing shareholders at less than their market price This is known as a rights issue Companies sometimes also choose to capitalize part of their profit, i.e turn it into capital, by issuing new shares to shareholders instead of paying dividends This is known as a bonus issue Buying a share gives its holder part of the ownership of a company Shares generally entitle their owners to vote at a company’s Annual General Meeting (GB) or Annual Meeting of Stockholders (US) , and to receive
a proportion of distributed profits in the form
of a dividend – or to receive part of the
company’s residual value if it goes into liquidation Shareholders can sell their shares
on the secondary market at any time, but the market price of a share – the price quoted at any given time on the stock exchange, which reflects (more or less) how well or badly the company is doing – may differ radically from its nominal value
Trang 4Futures markets
F utures markets provide a way for business to manage price risks Buyers can obtain
protection against rising prices and sellers can obtain protection against declining prices through futures contracts
For example, in spring, farmer Jones planted 100 acres of soybeans and he anticipates that in September he will harvest 5,000 bushels He is concerned about what the prices of soy-beans will be in September, if the price falls he will lose money To avoid this risk, farmer Jones has his futures broker sell a contract for 5,000 bushels of soybeans for September at the current price In this way the farmer locks in his Septem-ber selling price If the price is higher in SeptemSeptem-ber, the farmer will not make as much profit, but if the price has fallen, he will come out ahead This process of obtaining price protection is called hedging
To realize a profit, it is necessary to be right about both the direction and the timing of a price change Even experienced investors rarely invest more than a small portion of a total invest-ment portfolio in futures contracts In fact, in the last few years a number of large and so-phisticated investors have made the front pages of newspapers for losing all of their money
on one kind of risky futures investment called a "derivative"
OTC-traded stocks
In the U.S., over-the-counter (OTC) trading in stocks is carried out by market makers that
make markets in OTC Bulletin Board OTC stocks are not listed or traded on any stock exchange They are traditionally those of smaller companies that do not meet the listing requirements of the New York Stock Exchange or the American Stock Exchange
The OTC market presents investment opportunities
for informed investors, but also has a high degree of
risk Many OTC issuers are small companies with
limited operating histories or are economically
distressed Investments in legitimate OTC companies
can often lead to the complete loss of the in
vestment Investors should avoid the OTC market
unless they can afford a complete loss of their
investment
In recent years, however, many companies that qualify for listing have chosen to remain with over-the-counter trading, because they feel that the system of multiple trading by many dealers is preferable to the centralized trading approach of the New York Stock Exchange, where all trading in a stock has to go through the exchange specialist in that stock The rules of over-the-counter stock trading are written and enforced largely by the National Association of Securities Dealers (NASD) , a self-regulatory group Prices of over-the-counter stocks are published in daily newspapers, with the National Market System stocks listed separately from the rest of the over-the-counter market Other over-the-counter markets include those for government and municipal bonds
Source: From How Financial Markets Work, Resource Center, Investor Protection Bureau, US, http://www.oag.state.ny.us/
Trang 5According to text A, which information below is true (T), false (F) or NG (not given)?
Use the words provided (in the box) below to fill in the blanks
a commodities b financial securities c market economy
d specialized e liquidity f dividends
g general h intermediaries i issues a receipt
j raising of capital
In economics, a financial market is a mechanism that allows people to easily buy and sell (1) (such as stocks and bonds), _(2) (such as precious metals or agricultural goods), and other fungible items
Financial markets have evolved significantly over several hundred years and are undergoing constant innovation to improve _(3) _
Both (4) _ markets (where many commodities are traded) and _(5) mar-kets (where only one commodity is traded) exist Marmar-kets work by placing many interested buyers and sellers in one "place", thus making it easier for them to find each other An econ-omy which relies primarily on interactions between buyers and sellers to allocate resources
is known as a (6) _ in contrast either to a command economy or to a non-market economy such as a gift economy
1 Financial markets are classified according to the kinds of items/things sold
and bought on each of them
2 Many people use the stock markets to make profits of their stocks/ shares
3 Before issuing stocks/ shares, companies often hire professional people to
write the prospectus
4 A reliable investment bank is often asked to underwrite the issue of stocks/
shares of a company
5 In order to raise capital, companies use all of their profits to pay dividends
6 Owning stocks/ shares of a company gives the owner only the dividend
7 Futures markets are to protect buyers and sellers against dramatic changes
in prices
8 To make profit on futures markets, an investor should have good sense of
prediction
9 Companies listed on OTC market are always well-performed ones
10 Investors prefer the OTC market as they are less formal and more profitable
2.1
2.2
Trang 6In finance, financial markets facilitate the (7) _ (in the capital markets); the transfer of risk (in the derivatives markets); or International trade (in the currency markets) and are used to match those who want capital to those who have it
Typically a borrower (8) _ to the lender promising to pay back the capital These receipts are securities which may be freely bought or sold In return for lending money
to the borrower, the lender will expect some compensation in the form of interest or _(9)
Without financial markets, borrowers would have difficulty finding lenders themselves (10) _ such as banks help in this process Banks take deposits from those who have money to save They can then lend money from this pool of deposited money to those who seek to borrow Banks popularly lend money in the form of loans and mortgages
Read the text and do the exercises below The suggested time for reading the text and completing the exercises is 30 minutes.
FACTORS WHICH AFFECT MARKETS Factors which affect markets
Up or down? Financial markets can be affected by a number
of factors which includes both subjective and objective ones
Actions of investors: Individual, institutional and mutual fund
investors all affect the prices of stocks, bonds, and futures,
by their actions For example, if a large number of people
want to buy a certain stock its price will go up, just as if many
people were bidding on an item at an auction
Business conditions: Both the condition of an individual
business and the strength of the industry it is in will effect the price of its stock Profits earned, volume of sales, and even the time of year will all affect how much an investor wants to own a stock
Government actions: The government makes all kinds of decisions that affect both how much
an individual stock may be worth (new regulations on a business) and what sort of instruments people want to be investing in The government interest rates, tax rates, trade policy and budget deficits all have an impact on prices
Economic Indicators: General trends that signal changes in the economy are watched closely
by investors to predict what is going to happen next Indicators include the Gross National Product, the inflation rate (how quickly prices are rising), the budget deficit (how much the government is spending) and the unemployment rate These indicators point to changes in the way ordinary people spend their money and how the economy is likely to perform
International events: Events around the world, such as changes in currency values, trade barriers, wars, natural disasters, and changes in governments, all change how people think about the value of different investments and about how they should invest in the future Today, investments can be purchased around the clock When the market opens in New York, the Tokyo market has just closed and the London market is half way through its trading day When prices on one market change all other markets are affected
Trang 7The bull and the bear
Abull market and a bear market are terms used to describe the
general market trends A bull market is a period
during which stock prices are generally rising A bear
market is a period when stock prices are generally falling Each
of these markets is fueled by investors' perceptions of where the
economy and the market are going If investors feel that they are in
a bull market, they will feel confident investing, adding to the
growth of the market However, if investors think that the market is falling they will sell stock
at lower prices, continuing the bear market These trends may quickly change
Source: From How Financial Markets Work, Resource Center, Investor Protection Bureau, US, http://www.oag.state.ny.us/
Read the text and answer the following questions
1 What will happen if the number of buyers for a certain stock suddenly increases?
2 If the EPS (earning per share) of a company is positively increasing, what will investors do?
3 What are affected by government’s decisions?
4 Which indicators of the economy do investors closely watch?
5 What do the economic indicators show?
6 What is the effect of changes in international events?
7 When do investments take place?
8 How are stock prices like in a bull market?
9 What happens if investors are in a bull market?
10 Does the period of a bull market or bear market last long?
Listen to a radio broadcast about the stock market TWICE and answer the questions below
1 How does an English dictionary explain the phrase “to sell a bear”?
2 What are investors always concerned about?
3 What will happen when a company goes belly up?
4 What do investors want from a company whose stocks they own?
5 What does “windfall” mean?
2.3
3.1
Trang 8Listen to the radio broadcast ONCE again and fill in the blanks below
Stock Market: The Business of Investing
Bells sound Lighted messages appear Men and women work at computers They talk on the telephone At times they shout and run around
This noisy place is a (1) Here expert salespeople called (2) _ buy and sell shares of companies The shares are known as stocks People who own stock in a com-pany, own (3) _
People pay brokers to buy and sell stocks for them If a company earns money, its stock (4) _ in value If the company does not earn money, the stock (5) in value
Brokers and investors carefully watch for any changes on the (6) That is the name given to a list of stocks sold on the New York Stock Exchange
Investors and brokers watch the Big Board to see if the stock market is a (7) or
a (8) In a bear market, prices go down In a bull market, prices go up
Investors in a bear market promise to sell a stock in the future (9) But the investor does not own the stock yet He or she waits to buy it when the _(10)
Complete the passage below, using words from the box The suggested time for completing the exercise is 10 minutes
If you (1)………… a business, the time often comes when you wish to expand it To-do so, you will need extra (2) ………… one way to get this is to (3) ……… money from a bank The banks make a (4)………to you, but you pay (5)……… one the money it lands Another way is to ask the bank for an overdraft If it agrees to give you one, you can the draw out money up to a certain limit
You may, however, not want to owe money to the bank You
prefer not to be in (6)……… In that case, you could
(7)………… money by asking people to invest in your
business In return for their investment, you would offer them
(8)……… … in your business Finally, if you need a lot
of money to (9) …… …… Expansion, you may decide
to go public When you do this, you usually lose some
(10)………… over your company
4.1
3.2
borrow capital loan finance control shares own debt
raise interest
Trang 94.2 Choose the most suitable words to fill in the blanks of the following sentences. The suggested time for completing this exercise is 5 minutes
1 Offering shares to the public for the first time is called a company
2 A company offering shares usually uses a merchant bank to _ the issue
3 The major British companies are on the London Stock Exchange
4 The price of a futures contract is determined the contract is made
5 The value written on a share is its value
6 American corporations with large amounts of cash can spend it by _ their own shares
7 The majority of bonds has a rate of interest
8 People who buy securities expect their price to rise so they can resell them before the next settlement days are known as
Individual work
Based on the information in the two texts above, answer the following questions
in your own words
1 What is a financial market?
2 How is a company floated?
3 What is the advantage of futures markets?
4 What is the characteristic of OTC markets?
5 What factors affect financial markets?
Pair work or group work
Work with your partner(s) and discuss the following question
If you possess a large amount of money, what are the advantages and disadvantages of the following?
5.1
5.2
Trang 10Buying bond
Buying shares
taking all your money to Las Vegas
b
u
y
i
n
g
g
o
l
d
pulting it in a bank
investing in property or real estate
buying a lottery ticket
Buying a Van Gogh painting Put it under the mattress
