Financial assets are typically short-term. A promissory note is a document that reflects the commitment to pay .Authority (which requires funding) for precise reverse fork) to the date of maturity. Therefore, a note is both a financing instrument for the issuer and investment for the holder. The notes may be issued by public authorities, credit institutions or companies, and are always short term. Investors can operate with the notes in three different ways:
* Subscription to the primary market in fixing the price, the discount and the expiration date of the note.
* Buying and selling in the secondary market for notes and posts encirculación. This mode of operation and the earlier they are called “to maturity”.
* Purchase and repurchase. Thus, the investor can invest their funds to the period that interests you. The notes are traded at auction and the price is discounted based on the contract and the time remaining to maturity.
Treasury Bills
Treasury bills with maturities of three to six months or a year are emitted into the sequent, usually fortnightly auctions. Treasury bills may be subject to double operations, which are two purchases, tied the opposite sign, one spot and one at the agreed time. In a double operation the buyer of a Treasury bill is obligated to resell the same person within a period and an agreed price. Therefore, the seller in a double operation is required to repurchase the agreed price and time. In this way you can invest, or borrow funds at very short notice. The lyrics tend to offer higher returns those promissory notes and that despite
That practice has not been withholding tax, financial institutions have to report to the Treasury a list of holders. In the notes on the other hand, in addition to not make the deduction has not been to communicate the list of investors who have enjoyed with fiscal opacity.
Commercial paper. Commercial paper or notes to the order are short-term debt issued by companies. Commercial paper traded in the stock market through its members. It can also be purchased through financial institutions mediators, such as banks, savings and money market societies. Commercial paper gives companies the opportunity to go to the bag with its own role and without requiring the approval of the banks and therefore reduce the cost of intermediate. This form of financing is used by some of the nation’s largest companies as they have to offer the maximum credit to potential investors.