December 2020 CFA Level 1: Study Session 12. Equity Investments I - Reading 36. Market Organization and Structure

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	Reading 36. Market Organization and Structure
	1. The Functions of the Financial System a. explain the main functions of the financial system;
	2. Assets and Contracts b. describe classifications of assets and markets; c. describe the major types of securities, currencies, contracts, commodities, and real assets that trade in organized markets, including their distinguishing characteristics and major subtypes;
	3. Financial Intermediaries d. describe types of financial intermediaries and services that they provide;
	4. Positions e. compare positions an investor can take in an asset; f. calculate and interpret the leverage ratio, the rate of return on a margin transaction, and the security price at which the investor would receive a margin call;
	5. Orders g. compare execution, validity, and clearing instructions; h. compare market orders with limit orders;
	6. Primary Security Markets i. define primary and secondary markets and explain how secondary markets support primary markets;
	7. Secondary Security Market and Contract Market Structures j. describe how securities, contracts, and currencies are traded in quote-driven, order-driven and brokered markets;
	8. Well-Functioning Financial Systems k. describe characteristics of a well-functioning financial system;
	9. Market Regulation l. describe objectives of market regulation.