6# Government securities market..banking and Financial institutions..NTA NET COMMERCE

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Hello friends we were discussing about financial markets so in that today we need to discuss about g sec where g means government sec means the securities that is basically government securities securities means instruments of government instruments market we are discussing okay so in financial market you have a different instruments marketing so in that you

Have various instruments in that g’s instruments are also one of the important one okay so if the same jisuk jisuk is nothing but issued by government of india okay if it is issued for short term it comes under money market jisuk if it is issued for more than one year it comes in a capital market jisuk okay so let’s see the jisuk market in india has observed a

Considerable changes during the past decades like this one electronics cream-based a data system d materialized holding i mean to say so nowadays this government securities is going online application and also procedure transfer and also you know payment of investment amount and also getting the interest and everything has become screen based you don’t need any

Instrument in hand the instrument like the card for example if it is treasury bills you don’t need to have physical card it is posted to your mobile phone okay with a secured password and something or e to your computer basically to your email address okay this is what is jisuk a jisuk is it first of all the meaning of jisuk is it is a tradable instrument you can

Trade the government securities and this is issued by central government also state coordinate also both can issue government securities but these are issued through their government directly won’t issue jisuk okay it issues through auctions they’ll make auctions if you want to invest in government securities i mean if you want to give the money for purchasing the

Government securities for holding some time and after that giving the securities back and get the interest for this you should the participate in the auction online auction also is available okay these auctions are usually conducted by reserve bank of india okay the government securities always issue government securities instruments with the help of reserve bank

Only it acknowledges the government’s adept obligation okay and that means how much the government need to fulfill its debt obligation okay the repayment of loans government’s responsibility to repay the loan for that it is you some of the securities because god may need the money here why government issues the government securities because government has taken

Loan it should repay the loan that’s why it need the money from you from the people and then it will repay the loans that’s wait to meet the government depth obligation rbi issues and from the e platform i told you know most of the options nowadays are held through online so it is the e platform electronic platform it is called as eq paid okay that means rbi will

Make auction and that option is online that’s that is called as li qu bear and this is only for government securities i hope you understood okay and you have a short term jisuk market also in long term also short term example treasury bills long term treasury bonds i did this is also called as a dated securities and the gc carry practically no risk i mean if you

Interest in shares or debentures definitely there will be high risk and high return here it is less risk you don’t left to no risk you can say no risk you will definitely get back your amount but less return less risk means less return also okay if you want to make money if you want to make huge money investing in government security is a foolish foolish option but

If you want to grow gradually and slowly in sheer business the first preference may be given to government securities and these are called as a risk free securities because less risk will be there your amount is guaranteed and gilt-edged instruments the gilt here means gold see you can go and check the images of treasury bills or treasury bonds in google you will

See a gold coating okay like this gold coating and this is only given for government security instruments that’s why it is called as gilt edged instruments risk free gilt edged instruments okay and then you have many types of government securities the first and important one is treasury bills t bills is also called as treasury bills to meet short-term as i told

You before government securities for short term also decision in that you will get rashidah bills long term treasury bonds so we are learning about short term that is treasury bills here to make the short term a fiscal deficit explain you the meaning of fiscal deficit that this government is unable at present the government feeling difficulty to repay the loan

Taken from imf or from other countries so that is fiscal deficit so to meet that short term fiscal deficit treasury bills are issued and these are issued in the form of promissory note so it is a promise made by government of india to the one who invest in treasury basicness one who purchase for him or her government of india make the promise so it is issued in

The form of promissory note and in physical form usually physical form also you should or by credit – yes gtl account or the content the materialized form i mean you can go to a reserve bank of india branches ok there you can get your promissory note in the physical form itself it will given to your hand or else the amount of i mean if you want that certificate

That treasury bills you can deposit them own and you will get back your amount with interest okay in sgl that is subsidiary general ledger or gilt account it is also killed called as gilt account indi materialized from dematerializes nothing but online form okay not physical one and this is carries this is carrying very lowest interest rate as i told you less risk

Less return also and it is fixed by the interest rate is lowest we know but how much is fixed by reserve bank of india from time to time it will be changing but it has highest security naturally and the minimum amount of bits from 25000 itself i mean if you have that 25,000 and you are looking for an opportunity to invest and double your money slowly but safely

Okay you’re starting earner maybe and if you want the safe play you don’t want to lost money but you need to you know get some interest you want to invest somewhere where it is safety also and you will get a fair amount of return also then you are ready to purchase treasury reapers because the minimum amount is twenty five thousand itself and issued a discount

Repaid at path so it is usually issued a discount and repair power and the remaining will be your profit and how many types of treasury bills are there two types when it’s ordinary treasury bills that is a still the what i explained that is ordinary treasury bill it is given to public by original bank of india but you have another type of treasury bill which is

Called as a doc treasury bill here what happens it is purchased by rbi on tap and rbi is authorized to issue purchaser is yes you should buy rba yes why they do this because to maintain that to have the currency note okay for the difficulty in currency note printing they will do this see for the if country’s facing inflation problem less gdp growth or even deflation

Problem and foreign exchange rate problem then at that time what happens the currency node will be affected that’s where rbi – rpi there will be a transaction short term transaction so as this is government and i rba to other branch of forbid this is also government it is jisuk instruments right you have an ordinary that is rbi to public and you have a dog that is

Rbi to rbl itself okay and then you have three types of rbi one is a ordinary underdog and you have another form also this depends upon number of days i mean three months six months and 12 months 91 day 182 day and 364 day only these three options are available if you want to invest in rb say for example you are having so even though it is at 364 c it is less than

One year only no that’s why this is short-term the highest number is 364 therefore treasury believes a money market instrumental so if you are asked to write about money or pick out the money market instrument you can take this treasury bills also this comes in government security also in money market instrument also okay see the meaning of this means for example

If you are having twenty five thousand and if you choose 91 day treasury bills so you should give 25,000 and get pressure you bill in physical or dematerialized from whatever it is you will be having this certificate and 91 days you should keep your certificate with you after that you can go and ask reserve bank of india not going directly but asking online okay

I mean they will only give but you you have to know you can five months after 91 days you in your guilt account okay in your guilt account you’re 25,000 plus some interest say for example 250 so basically 25,000 250 will be given to you after 91 days it will be given to your guilt account okay so this is a rough form all i don’t know what is the present rate of

Rba because it is keep on changing day by day even faster than the gold rate okay you won’t be asked what is that rate okay it is not necessary for your examination but this is what the meaning this is how the treasury bill works and next let us know about another government security that is tb that is treasury bonds okay or this is also called as dated government

Securities these securities carry a fixed or floating interest rate it can have fixed interest rate also floating interest rate also but this is long term one okay long term government security insured by government of india for a period more than one year and this is paid on face value and this is paid on havi early basis and the ten or is five to thirteen years

And recently it made thirty years to 40 years okay i mean if you want to invest in treasury bonds you can give your ramone say for example you know file a q have invested in treasury bonds and you should wait minimum of five years okay it is agreed you can choose from five to thirty it was nowadays it is five to forty so in five to forty you can choose any year

It is a return in the bond paper so for example if you have choosen thirty five years till thirty five years you should wait for your getting back of money okay for your file ax you should wait for 35 years after 35 years you will be given your five lakh plus interest and this interest will be usually high because as you have invested for soul long time naturally

The interest rate will be very high but again not that much of a commercial bonds okay in commercial bonds or in ordinary bonds these are given that these are a high risky and this is given from companies side not from government of india so in that you can make a huge esta profit but not much safety you have in commercial bonds but in treasury bonds you will

Have safety also in the fair interest also you will have okay and you know you have cmb status cash management bill this is also one of four government security in 2010 ok government of india consulting the rpa introduced new short term instrument firstly we were having only treasury bills so plus to this treasure it is a lada bills that is cash management bills

Are issued in 2010 okay of course by consulting rbi and why these are issued to meet actually white treasury bill sorry sure treasury bill sorry sure to make short term requirements right but this is cash cash is very non convertible into cash because cash is readily a cash one that means which you can everyone can accept that so so in some cases the people won’t

Accept a bit card or something else but the cash is accepted by anyone so this is to meet the temporary mismatches in the cash flow of government of india and also not for short term this is for urgent requirement okay this is for urgent requirement that ii that’s why the characteristics is same of treasury bills but see mbc should even less than 91 days to make

The argent requirements of the government the cmb sorry sure and here it is even less than 91 days also okay and also to meet the why the government issues this to meet the temporary mismatches of cash flow that is cash inflow if it is cash inflow to the government see i’ll tell you cash inflow and cash out flow that means cash in from is usually tax i’ll give

You just simple example cash outflow my social sir for social services government grants okay so if this happens mismatches that means if the tax collected is less but the government has to meet more obligations currently then these cmbs are issued okay they cannot collect further tax because still their economic activities are not done at that time they can use

Cms okay yes and then you have a long-term loan market so about this i’ll tell you in the next video thank you so much for watching and keep fighting until fake to your career thank you

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6# Government securities market..banking and Financial institutions..NTA NET COMMERCE By VICTORY CLASSES by Varshitha S