What do you mean by financial assets?
A financial asset is a liquid asset that represents—and derives value from—a claim of ownership of an entity or contractual rights to future payments from an entity. Stocks, bonds, cash, CDs, and bank deposits are examples of financial assets.
What are financial assets and liabilities?
Financial liability – an obligation to deliver cash or another financial asset. Financial asset – any asset that is cash, a contractual right to receive cash or another financial asset from another party, or an equity instrument issued by another entity.
Which are financial assets A machines B bonds C stocks d none?
Explanation : Machines and Stocks are financial assets. A financial asset is a liquid asset that gets its value from a contractual right or ownership claim.
Why do we need financial asset in the economy?
In general, financial assets serve two main economic functions: the first is to transfer funds from those who have surplus funds to invest to those who need a source of financing tangible assets. Financial assets represent legal claims to future cash expected often at a defined maturity.
What are real assets and financial assets?
Financial Assets are highly liquid assets that are either in cash or can be fast converted to cash. They include investments such as stocks and bonds. Real Assets, on the other hand, are value-driven physical assets that a company owns. They include land, buildings, motor car, or commodities.
What are the 4 types of financial assets?
Types of Financial Assets
- Cash and the Cash Equivalents.
- Fixed Deposits.
- Equity Shares.
- Preference Shares.
- Debentures.
- Accounts Receivable.
- Mutual Funds.
- Derivatives.
What are financial assets * 1 point A bonds B machines C stocks d’A and C?
Answer: The answer is D. Bonds and stocks are examples of financial assets.
What are the types of financial assets?
Types of Financial Assets
- Cash and Cash Equivalents. Cash and paper money, US Treasury bills, undeposited receipts, and Money Market funds are its examples.
- Accounts Receivable.
- Fixed Deposits.
- Equity Shares.
- Debentures/ Bonds.
- Preference Shares.
- Mutual Funds.
- Interests in subsidiaries, associates and joint ventures.
What is the risk of a financial asset?
What Is Financial Risk? Financial risk is the possibility of losing money on an investment or business venture. Some more common and distinct financial risks include credit risk, liquidity risk, and operational risk. Financial risk is a type of danger that can result in the loss of capital to interested parties.
What is real assets in simple words?
Real assets are physical assets that have an intrinsic worth due to their substance and properties. Real assets include precious metals, commodities, real estate, land, equipment, and natural resources.
Why are real assets?
Real assets offer the opportunity for diversification, inflation hedging and competitive total return potential. Real assets may also serve as a nontraditional source of income, a feature that investors frequently overlook.
What are the main financial assets?
a contractual claim to something of value; modern economies have four main types of financial assets: bank deposits, stocks, bonds, and loans. In reality, there are many more types of financial assets (like derivatives, calls, puts, and so on), but you only need to know the basics of these four types for this course.
