JP Morgan Chase & Co. Interview Prepration(1)

An investment bank is a financial institution that assists individuals, corporations, and governments in raising capital by underwriting and/or acting as the client’s agent in the issuance of securities. An investment bank may also assist companies involved in mergers and acquisitions and provide ancilaary services such as market making, trading of derivatives and equity securities, and FICC services (fixed income instruments, currencies and commodities). Unlike commercial banks and retail banks, investment banks do not take deposits.

There are two main lines of business in investment banking. Trading securities for cash or for other securities(i.e,facilitating transactions , market-making), or the promption of securities(i.e. underwriting, research, etc.) is the “sell side”, while buy side is a term used to refer to advising institutions concerned with buying investment services. Private equity funds , mutual funds, life insurance companies, unit trusts, and hedge funds are the most common types of buy side entities.

Investment banking is split into front office, middle office, and back office activities. While large service investment banks offer all lines of business, both sell side and buy side, smaller sell-side investment firms such as boutique investment banks and small broker-dealers focus on investment banking and sales/trading/research, respectively.

Front office area includes Sales and trading/ Research.

Middle office area includes treasury management, internal controls, and internal corporate strategy.

Back office area includes Operations/Technology.

The largest investment banks as of December 31,2011 is JP Morgan Chase with Fees($m) $5,517.62

JPMorgan Chae & Co. is an Aamerican multinational banking and financial services holding company. It is the largest bank in the United States by assets, and as of 2013, it ranks as the second largest bank in the world by assets with total assets of $2.509 trillion. It is a major provider of financial services, and according to Forbes magazine is the world’s second largest public company based on a composite ranking. The hedge fund unit of JPMorgan Chase is one of the largest hedge funds in the United States. It was founded in 2000, when Chase Manhanttan Corporation merged with J.P.Morgan & Co.

The J.P.Morgan brand, historically known as Morgan, is used by the investment banking as well as the asset management, private banking, private wealth management and treasury & securities services division. Fiduciary activity within private banking and private wealth management is done under the aegis of JPMorgan Chase Bank, N.A. – the actual trustee. The Chase brand is used for credit card services in the United States and Canada, the bank’s retail banking activities in the United States, and commercial banking. JPMorgan Chase & Co. is considered to be a universal bank.

JPMorgan Chase in its current structure, is the result of the combination of several large U.S. banking companies since 1996, including Chase Manganttan Bank, J.P.Morgan & Co., Bank One, Bear Steans and Washington Mutual.

外汇(Foreign Exchange,或Forex)是货币行政当局以银行存款,财政部证券,长短期政府证券等形式所持有的国际收支逆差时可以使用的债权.它是国际贸易的产物,是国际贸易清偿的支付手段.外汇的动态含义是指将一国的货币兑换成另一国的货币,借以清偿国际间债务债权关系的专门性货币经营活动,它是国际间汇兑的简称.

外汇的静态含义则是指以外国货币表示的,用于国际间结算的支付手段和信用工具.现汇又称即期外汇,在成交后,买卖双方为了防避汇率变动的风险,按照预先商定的币种和数量,期限和汇价,订立外汇买卖合约或协议,在到期日进行实际交割.由于远期外汇是一种预约性交易,从签订合约到实际交割有一段过程,远期外汇汇率便根据货币的价值趋向以及远期期限来指定.远期外汇期限一般有三个月,六个月,九个月.买卖远期外汇的主要目的是为了减少或避免由于汇率动荡而引起的风险,是一种保值手段.

现汇是一种外汇结算凭证,银行可以通过电子结算直接入账,它包括从国外银行汇到国内的外汇存款,以及外币汇票,本票,旅行支票等.而现钞指的是国内居民手持的外汇钞票.由于银行买进外汇现钞相对于买进现汇有利息损失,故在银行的外汇报价中,现钞买入价一般低于现汇买入价.而对于现钞卖出与现汇卖出来说,银行没有利息损失,因此,现钞卖出价与现汇卖出价是一致的,银行一般只表明现钞买入价,而没有现钞卖出价.

即期外汇业务(Spot Exchange):是在外汇买卖成交以后,原则上两天以内办理交割(Delivery)的外汇业务.又分为电汇(telegraphic Transfer T/T,信汇(Mail Transfer M/T)和票汇(Demand Draft).

远期外汇交易(Forward Exchange Transactions)是相对于即期外汇交易而言的.远期外汇买卖是以约定的汇价在将来某一约定的时间进行交割的交易.

外币期货交易是指买卖双方在期货交易所以公开喊价方式成交后,承诺在未来某一特定日期,以当前所约定的价格支付某种特定标准数量的货币.

期权就是在一特定时期内按一定汇价买进或卖出一定数量外国货币的权利,也可以叫做外币期权交易.外币期权有两种形式:买方期权和卖方期权.买方期权使签约一方有权在合约期满时或在此以前按规定的汇率购进一定数额的外币.卖方期权是使一方有权在期满时或在此以前按规定的汇率出售一定数额的外币.

债券(Notes)是政府,金融机构,工商企业等机构直接向社会借债筹措资金时,向投资者发行,承诺按一定利率支付利息并按约定条件偿还本金的债权债务凭证.债券的本质是债的证明书,具有法律效力.债券购买者与发行者之间是一种债权债务关系,债券发行人即债务人(Debtors),投资者即债权人(Creditors).

金融衍生产品是指其价值依赖于标的资产(Underlying Asset)价值变动的合约.这种合约可以是标准化的,也可以是非标准化的.标准化合约是指其标的资产(基础资产)的交易价格,交易时间,资产特征,交易方式等都是事先标准化的,因此此类合约大多在交易所上市交易,如期货.非标准化合约是指以上各项交易的双方自行约定,因此具有很强的灵活性,比如远期合约.

金融衍生品的共同特征是保证金交易,即只要支付一定比例的保证金就可进行全额交易,不需实际上的本金转移,合约的了结一般也采用现金差价结算的方式进行,只有在满期日以实物交割方式履约的合约才需要买方交足贷款.因此,金融衍生产品交易具有杠杆效应.保证金越低,杠杆效应越大,风险也就越大.

金融衍生产品具有以下几个特点:

1. 零和博弈:即合约交易的双方(在标准化合约中由于可以交易是不确定的)盈亏完全负相关,并且净损益为零,因此称”零和”.
2. 高杠杆性:衍生产品的交易采用保证金制度(margin).即交易所需的最低资金只需满足基础资产价值的某个百分比.保证金可以分为初始保证金(Initial margin),维持保证金(maintains margin),并且在交易所交易时采取盯市制度(marking to market),如果交易过程中的保证金比例低于维持保证金比例,那么将受到追加保证金通过(margin call),如果投资者没有及时追加保证金,其将被强行平仓.

金融衍生产品主要有以下几种分类方法

(1). 根据产品形态.可以分为远期,期货,期权和互换(swaps)四大类.

(2). 根据原生资产大致可以分为四类,即股票,利率,汇率和商品.

(3). 根据交易方法,可分为场内交易和场外交易.

场内交易又称交易所交易,指所有的供求方集中在交易所进行竞价交易的交易方式.这种交易方式具有交易所向交易参与者收取保证金,同时负责进行清算和承担履约担保责任的特点.

场外交易又称柜台交易,指交易双方直接成为交易对手的交易方式.掉期交易和远期交易是具有代表性的柜台交易的衍生产品.

公允价值定义为”市场交易者在有序交易中,销售资产收到的或转移负债支付的价格”.

中间汇率Medial Rate:买入汇率与卖出汇率的平均数就称为中间汇率.中间汇率用来对汇率进行分析.