Nationally recognized wealth management company Certuity has been helping affluent clients effectively manage their assets for over 21 years. In early September, Managing Director of Certuity Mariia Eroshin, CFA, CPA, CFP®, MBA offered her vision of the importance of fee transparency for attorneys in the article “Fee Transparency is Key for Attorneys.” An interview with Mariia was published in the blog section of the company’s website. Ms. Eroshin has over 20 years of experience advising ultra-high-net-worth families. Therefore, her view on the compensation structure helps shed light on some aspects of the fee that often remain in the shadows.

On the Importance of the Source of Financial Advisors’ Fees

Every client who comes to a financial advisor assumes certain financial risks. The basis for cooperation is trust in the advisor’s expertise. But what if the financial advisor receives their remuneration not only for the consultation? They may receive a certain percentage from external companies for promoting their insurance or investment products. In this case, the attorney hopes for professional advice from an expert, but in reality, they get an ad from a promotional agent.

How to Find a Way Out of the Labyrinth of Fees

Attorneys understand the importance of legal regulations and obligations better than anyone else. Therefore, the secret to avoiding the trap of hidden fees and manipulation of clients is clear to them. The main tip is to find financial advisors who act as fiduciaries. They are obliged to adhere to all legal standards imposed on fiduciaries, the main of which is to act in the best interests of clients.

Certity is a Registered Investment Advisor (RIA), which is responsible for all wealth management advice and other services. Therefore, all fees charged by the company are transparent and can be easily explained to clients.

Indicators for Assessing the Trustworthiness of a Financial Advisor

• Registration with the Securities and Exchange Commission (SEC) or other authorizing bodies;
• Qualifications and experience of the advisor;
• Track records;
• Transparency of all fees.

Attorneys should not hesitate to make inquiries on all of these indicators. Moreover, they should check the Form ADV 2A of the advisor whose services they are going to use. It contains all the fees that will reveal how the advisor earns money.

Questions to Ask Financial Advisors About Fees

• Does a financial advisor act as a fiduciary?
• What are the sources of compensation for an advisor?
• Do they work for a fee or receive additional commissions for promoting a certain investment, insurance, and other products?

Answers to these and other questions will help attorneys see the real picture, not the one offered in advertisements.

About Certuity

Certuity is an experienced wealth management firm that provides comprehensive services to ultra-high-net-worth individuals, including:

• Family office services;
• Outsourced Chief Investment Officer (OCIO);
• Legacy Planning;
• Investment Advisory, etc.

Certuity has received numerous awards recognizing its achievements and professional service. The awards also recognize many of the company’s financial advisors, who are constantly working to improve their knowledge and find ideal financial solutions in the best interests of their clients.

Certuity Offices

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What is Online Trading

Online trading in financial markets is one of the most popular ways to invest and increase savings. Previously, all orders for purchase and sale transactions were submitted to the broker in his office or by phone and could telegraph the order to the exchange, where a person in the exchange pit “voice” acquired the desired asset for the client.

Electronic trading has developed with the development of technology and the advent of the Internet. Now investors can independently analyze the market and submit trading orders directly to the exchange through terminals (special software for a computer or smartphone) provided by the broker.

Each investor or trader can independently make transactions with any instruments circulating on the exchange markets: bonds, stocks, currencies, futures, options, fund shares, etc.

Pros and Cons of Online Trading

The uniqueness of Internet technologies is that they are developing rapidly. And what was relevant 3-5 years ago is hopelessly outdated today. More and more people want to trade on the markets independently, without transferring money to trust management. Moreover, technologies allow an online analysis of the situation on the market, instructing the broker to open and close transactions through terminals. The choice of instruments is also wide – stocks, bonds, futures, currency, options, etc. The main advantages of online trading are:

• The undoubted advantages of online trading include the following:
• Almost instant receipt of trading orders to the exchange (less than 0.5 sec.);
• Control of open positions and financial results in real-time;
• Tracking prices, trading volumes, and other information;
• The ability to conduct technical analysis in real-time.

It is useful for beginners to know the disadvantages of online trading even before entering the market:

1. Transaction speed is a double-edged sword. On the one hand, this is efficient; on the other hand, there is a high risk of losing a deposit. After all, the Internet can disappear for technical reasons when you need to close a deal or make an important investment decision, which will significantly affect the trader’s income.
2. Great psychological pressure. Those who endure fluctuations in income, keep a cool head, and control the situation survive in this area and achieve results. After all, trading is characterized not only by huge profits but also by huge losses in the event of one failed transaction.
3. Delving into the intricacies of trading requires a lot of attention, effort, and time.

Myths About Internet Trading

Investors in many countries have long appreciated the benefits of e-commerce. Does this mean that classic telephone brokerage services are no longer needed? Of course not. The practice of the American and European markets suggests that brokers cannot replace the telephone if it is necessary to conclude very large transactions, especially with less liquid securities. In addition, there are many instruments, such as bonds, for which small transactions do not make economic sense due to the nature of the instrument – the price of bonds is usually less subject to exchange rate fluctuations. So investors who prefer this type of security are forced to enter into transactions for large amounts and long term. It is also more convenient to trade bonds by phone because, during the conversation, you can agree on the terms of the transaction and a better price. Therefore, the emergence of online trading does not mean that classic brokers will disappear from the market. Now many of them will be able to supplement the list of their services with Internet services, and investors will have a choice.

What is the range of investors targeted by online trading? First of all, private investors make small transactions. The minimum amount that must be deposited into the broker’s account is determined only by the marketing policy of this broker. At the same time, investing all these funds in one security is unnecessary, and you can even make a diversified stock portfolio.

Online trading allows you to respond more quickly to the market, so all over the world, it is also in demand by professional investors – those for whom investing is the main way to make money. These are asset management companies and the so-called hedge funds. Such companies employ traders with many years of experience who are well-versed in the market, manage very large investments, and can make transactions themselves without the help of a broker.

Promising Conclusion

The Internet has made it easier for many people to access exchanges. This is good and bad simultaneously because the financial markets turned out to be a crowd of amateurs without a little preparation, draining capital for half an hour of trading. Internet trading has simplified the opening of an account and the work of brokers with clients and reduced their services. Yes, and the entrance to some exchanges (the same Forex) has become quite low for people with an average income. The trading audience has greatly expanded – if you take an ordinary user, then almost everyone can understand securities and actively buy shares simply because it is promising and can bring a good% profit in the future.

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What is a bear market?

Formally, the market is bearish when the quotations of major indices have fallen by 20% or more from the previous maximum for at least 2 months. Basically, the world is guided by the US Stock Market Indexes. Most often this condition appears against the background of the recession in the economy, but sometimes it can be caused by political or military problems, monetary and tax policies.

Investors’ pessimism grows amid worsening stock market data, which often leads to panic sales of securities in portfolios. This is further exacerbated by the closing of margin positions by amateurs trading on borrowed money. This is a normal phenomenon in the cyclical development of the economy and there is no need to be afraid of it.

Differences of a bearish trend from a bullish trend and correction

A bull market is characterized by high point market dates and contrary events: the growth of stock quotes by 20% or more from the previous local minimum and lasting for more than 2 months. 

Another difference is speed of movement and volatility. The bearish phase is accompanied by panic, so the movements are accompanied by high volatility and large intraday movements — the investor is frightened and presses the SELL button at the slightest whiff of wind.

Looking at the long term, bull market periods are longer and longer in duration, so if your portfolio is prepared for cyclical declines and you have a clear plan of action, you can easily turn negative sentiment into opportunities for yourself.

How do you distinguish a bearish trend from a correction?

• They differ in the depth of the decline. Thus, a correction is a decrease in quotations within 10-20% of the previous local maximum.
• A correction is less long and, as a rule, lasts for less than 2 months.
• A correction may refer to a specific asset, while a bear market is used to indicate a movement.
• Any correction can begin a bearish trend, so analyze the developments. The duration and depth of quotes decline during a correction is shorter, and therefore the recovery is faster and this is the time to buy assets for long-term investors — the “buy the deep” rule.

Work with your risk assessment to avoid a steep peak in your portfolio.

Futures Market — what to do and how to trade?

Remember, the two fundamental rules are diversification and regularity of investment. Even when the market is in a bearish phase, be disciplined and stick to your buying strategy. No one knows where the bottom will be, but by investing regularly you will make sure that you have an effective position formation price.

How to reassure yourself and act wisely by using stock market data in trading?

• First, as trivial as it may sound, do not panic. Remember, 50% of failures are caused by ill-considered, impulsive transactions.
• If you have margin positions open (with borrowed money) — close them. Ideally, margin trading should be within clear limits of potential returns, and maximum allowable losses, so pay enough attention to risk management.
• Conduct a portfolio audit: which assets are appropriate for the current circumstances and which should be rebalanced because they are not appropriate for the current environment.
• The portfolio should be rebalanced to include protective assets that will be subject to the least pressure, or generate stable cash flow while waiting out declining prices and increased volatility, and the cache that will be needed to buy when you don’t want to buy at all.
• Creating a hedge for your portfolio. Such a hedge is a position that has an inverse correlation to the underlying asset. So, for example, if you are a long-term investor and your portfolio consists of long positions in stocks and bonds, then a hedge for you will be opening short positions or buying reverse ETFs. You can also hedge your portfolio with derivatives — Futures Market and options. For example, by purchasing a PUT option, an investor buys the right to fix the current price of an asset for its possible future sale.

How do speculators trade using stock market data? 

The principle of speculative trading is exactly the opposite. If in the growing market traders buy assets on drawdowns and fix profits on a rebound upwards, here speculators, short stocks and indices on the rise to resistance levels and repurchase positions on the resumption of correctional movements.

Such a trading strategy has brought significant profits for traders in 2022. However, it is worth bearing in mind that short positions are associated with an additional level of risk and holding costs. While a long-term investor can always sit out the “hard times” without incurring any additional costs for long positions, this will not work for shorts, as the interest on the securities loan will systematically decrease the account size.

Also, it should be kept in mind that historically, in the long run, the stock market tends to grow rather than fall.

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If you are getting started in the casino gaming world, this is the right article for your needs. As a casino gamer, you will learn how to make wise decisions.

Research the Casino Sites

To become a casino gamer, you should first research non Gamstop casinos sites. Thus, you will tell which ones are trustworthy and which ones are not. Furthermore, you will learn how their bonuses work, since knowing the bonuses each site offers is important before registering. Based on the amount required, you can also choose the bonus that suits your needs best.

Casino sites are not all the same. There will be some who offer better deals than others, and some who are more trustworthy. Prior to signing up for any particular site, it is important to do your research. It will help you decide what to do based on the information you have.

Make a Budget and Stick to It

Making a budget and sticking to it is a great way to ensure you won’t go overboard on your gambling. It’s also essential to limit how much you can spend in a single sitting and stick to that.

When you have a budget in place, you’ll keep track of your spending more. Making good decisions about how much money to risk will help you avoid going overboard.

Be Responsible When Playing

It is important to be responsible by knowing your limits before playing. In the event that you have a gambling problem, you should seek help as soon as possible. Take some time to learn how much money you should gamble with and how often. Once you’ve made a decision, stick with it!

Ensure you only use the money you can afford to lose when playing online casino games. By doing this, you can keep the gaming fun while protecting your finances.

Know Your Limits

Learning your limits is one of the most important things you can do as a casino gamer. In particular, this is true if you’re going to wager on sports or play at a live casino. It’s tempting to want to push yourself, but taking risks with money is never a good idea.

If you don’t know what your limits are and what kind of betting strategies work for you, we recommend starting small and working your way up. If there’s any doubt about whether this is something that will work for you—or if something feels off. It’s better to stop before it gets too big than after!

Keep an Eye on Your Spending

When you’re starting as a casino gamer, it can be easy to lose track of how much you’re spending. At the end of each day, keep track of how much money you have left in your bankroll. Ensure you don’t spend more than that amount on any given day. It will be harder to pay off your debts when they are due if you overspend.

The next time you play too much and lose money, remember that it’s OK to leave and that there are plenty of other ways to have fun.

Be a Responsible Casino Gamer

When starting out as a casino gamer, you should keep a few things in mind. Avoid getting caught up in the excitement of gambling and playing for higher stakes. Gambling is a game of chance, not a skill, and it can be a slippery slope that leads to addiction.

Be aware of when to stop playing. When you’re tired, bored, or upset, it’s time to take a break. It is best not to gamble if you suffer from depression or anxiety besides gambling problems. 

Ensure you don’t gamble with money you can’t afford to lose! It should go without saying, but it’s worth repeating. If you don’t have spare cash on hand and you’re not willing to risk losing it all, don’t gamble!

Don’t Get Addicted, but Enjoy It

Having fun and becoming addicted are two different things. Spending much time or money on gambling games may be a sign you should stop. It’s thrilling to win big bucks at casinos, but some people get carried away thinking they’re smarter than everyone else. You should treat casino games as entertainment if you want to enjoy your experience without feeling guilty later on.

Gaming Can Be Addictive; Make Wise Decisions!

When starting out as a casino gamer, you should make some wise decisions. Ensure you never gamble on what you can’t afford to lose. Set small goals for yourself and when you meet those, always reward yourself. You can play with money or with other small games. Always leave something on the side, so you don’t feel so bad if you lose. You will not be as frustrated if you lose if you keep a positive attitude.

The post 7 Wise Financial Decisions You Should Make When Starting Out as a Casino Gamer appeared first on Klic and Kown.

To help you avoid these mistakes when starting your financial institution, we will discuss them in this article.

Lack of a Solid Business Plan

Starting a financial institution from scratch takes effort and time. You must know what your business will be, who it will serve, and how you will reach them.

You risk spending time and money on things that don’t accomplish your goals without a solid business plan. Focusing on what matters most while keeping your eyes on the prize will help you get the most out of your time and resources.

Not Paying Attention to Your Competition

The world of financial institutions is competitive, and it’s essential to keep track of what your competitors are doing. You need to be aware of how they’re marketing themselves, how they’re pricing their products, and how they’re interacting with customers. And how to provide something better can help you stay competitive.

Doing Everything Yourself

Hiring a team of experts who can help you with the different areas of your business is essential. Having an internal team will help you create a better company culture. Leading to better products and services that are attractive to your customers.

Hiring the Wrong People

One of the biggest mistakes you can make when starting a financial institution from scratch is hiring the wrong people. Ensure that your employees are well-suited for the job and have the skills and ability to do it well.

If you don’t, you could end up with an employee who isn’t doing what they’re supposed to, or worse—one who lets customer information slip out of their hands into the wrong hands. A breach of security could result, which is something no institution wants to happen.

Not Implementing a Proper Marketing Strategy

As a new financial institution, it’s easy to get caught up in the day-to-day operations and forget about the bigger picture. But if you don’t have a marketing plan, it will be difficult for potential clients to find out about your business. And even more challenging for them to understand what makes it so great.

You can avoid this mistake by considering how your customers perceive your product or service at the start of your company’s life cycle. After that, write down specific goals related to branding and marketing strategy, and then plan how you’ll achieve them. As a result, you’ll still know where you want things to go when there are setbacks along the way or unexpected changes in the market. 

Underestimating the Cost of Doing Business

It is easy to underestimate the cost of starting a business. Most people don’t have access to an unlimited pool of capital. So they often overestimate how much they can afford to spend in the early days of their business. Starting a financial institution costs money—and lots of it!

The most important thing to remember is that your business needs to cover its costs during its first few years of operation. You’ll need adequate cash on hand (or under management) to cover three months’ rent and payroll. If you don’t have those things covered, your institution may not survive long enough for profits and returns!

Not Staying Up-to-Date in Your Industry

The financial industry is changing, and staying on top of the trends and challenges is essential to stay competitive. You should read industry publications, attend conferences, and keep up with local news. It would help if you kept new regulations in mind. It is not only those that affect your business but also those that may affect your competitors and suppliers.

Use of Complicated Language

Suppose you are starting a new financial institution, it can be tempting to use complicated language to show off your expertise. But don’t fall into that trap!

Remember, your clients are looking for someone who understands their needs. It helps them make the best possible decisions for their situation. If you sound like someone they can trust, someone who will treat them like humans instead of numbers, it will help.

If you want to be the kind of person who inspires confidence in others, then keep it simple when talking about money. Don’t use jargon or complex words when explaining things.

Learn From Your Mistakes!

You have the skills needed to start a successful financial institution if you have previous experience. As a founder, you need the determination to succeed and keep learning. Also, you’ll likely spend time networking. Staying on top of the latest industry trends is another way to stay growing and learning from your mistakes.

The post 8 Mistakes To Avoid When Starting Your Financial Institution From Scratch appeared first on Klic and Kown.

Registration of a financial company is a complicated, time-consuming procedure and requires a highly qualified specialist who will perform this work.

It is possible to open a financial company only after meeting a number of regulatory conditions and requirements. These requirements are made to: the size of the Charter capital of the financial company, the personnel, the premises, the availability of equipment, the complex development of standard contracts and the rules of the demonstration of financial services.

Types of financial companies
Under the financial companies, we often mean two different types of organizations.

The first kind is the financial companies, which are meant for granting and servicing the credits. Such a company may be called a credit-financial company.

The second type is investment financial companies or investment brokers. They can also work as investment advisors.

Financial company abroad is one of the popular tools of tax planning. They are often used to organize financial flows in groups of companies, to make investments in the United States, and to make loans to other companies and individuals. Loans, unlike contract proceeds, are not subject to profit or income tax. Taxes can be levied only on the material benefit in case the interest on the loan is too low. At the same time, the cost of servicing the loans, i.e. the interest paid on them, is included in the cost of production or services and reduces the taxable base of the company or individual – the recipient of the loan.

Registration of a foreign financial company with an appropriate license will allow the flexibility to use such a financial planning tool as issuing and servicing loans. Jurisdiction is determined depending on the purpose of the loan and whether or not there is a Double Taxation Agreement with the country where the loan recipient is located. Loans can be used for production purposes, purchase of goods, purchase of real estate, including for personal use, and for any other purpose. Own finance company will allow you to set the interest rate on loans, not only depending on market conditions, but also on the purpose of the loan, including the redistribution of profits within the group of companies.

If the granting of loans or credits is a regular activity for the company, such a company must obtain the appropriate license. In the simplest licenses there are strict limits on the amount of loans issued.

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Financial institutions help the economy as a whole to function properly so that people can efficiently process everyday financial transactions.

An example of working with a financial institution would be doing business with your local bank. If you open a savings account and deposit $100, you have provided the bank with some money that it can add to its pool for lending. You get a small amount of interest in exchange for your deposit along with FDIC insurance protection. When another customer at the bank decides to take out a $20,000 auto loan, the bank can use your $100 to fund the loan and charge the customer interest. The bank’s profit from this transaction will be equal to the difference between the interest charged to the customer and the interest they paid you.

FDIC
The government regulates financial institutions through various agencies to protect depositors and investors. For example, the Federal Deposit Insurance Corporation (FDIC) provides $250,000 worth of insurance per depositor at banks, while the National Credit Union Administration (NCUA) provides the same insurance at credit unions. These measures protect customer funds in the event of an institution’s bankruptcy and also reduce the likelihood of a bank run. Financial activities involving the exchange of securities (stocks, ETFs, etc.) are primarily regulated by the Securities and Exchange Commission (SEC).

Depositary vs. non-depositary
Financial institutions fall into two categories: depository and non-depository. Depository institutions include depository businesses such as credit unions, banks, and savings associations. In contrast, nondepository institutions include brokerage firms and insurance companies.

Types of financial institutions
There are different types of financial institutions that can meet your specific needs. They can be for-profit or non-profit, serve different types of clients, provide a specific purpose, or focus on specific services. The main types of financial institutions include:

Retail and commercial banks
Retail and commercial banks allow you to open deposit accounts and access a wide range of financial services related to saving and borrowing money. Retail banks serve individuals and commercial banks serve business customers.

Online banking platforms may not have a physical location, but they offer some of the same types of financial services as conventional banks.

Credit Unions.
Unlike banks, credit unions reinvest the money they earn from interest charges to keep costs low and benefit their customers. These depository institutions typically target a specific community or group of people and require membership. They offer a variety of traditional banking services, from current and savings accounts to credit cards and credit programs.

Insurance companies
Insurance companies offer different types of insurance policies to offer financial protection. For example, insurance companies often sell products such as life, health and home insurance. They put money from premiums into a pool to finance insurance coverage.

Brokerage Firms.
Brokers help with transactions in securities such as stocks, mutual funds and bonds. People who want to buy or sell securities use brokerage firms to facilitate the transaction. Some firms also offer financial advice and act as advisors.

Savings and Loan Associations.
These depository institutions, also known as “savings institutions” and less common, focus mainly on providing home loans and savings accounts. However, some also have other types of loans and account options, so they can sometimes seem similar to retail banks.

Investment banks
Investment banks work with corporations, governments and other institutions that need capital and financial advice. They do not handle customer deposits, but help with financing through securities such as bonds and stocks. They also offer advice on business planning and decisions, such as mergers.

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Definition and examples of financial institutions
Financial institutions are businesses that provide different types of financial services to customers. They use the funds that customers provide and then distribute the funds to individuals and businesses that need them. In this way, they bring depositors and sponsors together to facilitate transactions in the financial markets. For example, these businesses allow borrowers to obtain loans using funds that depositors have provided.

These organizations also help clients raise funds and invest their money. This includes facilitating the buying and selling of securities such as bonds and stocks. Some financial institutions also help clients protect their assets and help them manage their money. For example, some offer insurance policies that protect homes or cars from financial loss. Financial institutions may also buy and sell foreign currency.

The two most common examples of financial institutions are: consumer banks and credit unions. These institutions allow customers to open current and savings accounts to safely and conveniently store their money. Banks and credit unions then use customer deposits to make loans and credits to other customers, earning income through interest charges. Through these institutions, you can also manage many other tasks, such as cashing checks, exchanging currency, investing money in a retirement account and paying bills.

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Intermediation, as already noted, is the main function of financial institutions and logically complements the function of saving, because, accumulating the money saved and having to pay for it, a financial institution must be concerned about their use, generating income, which will be sufficient not only for payments to savers, but also to generate its own income. Thus, the funds go from the saver to the borrower, and the actual process of transferring the funds is accompanied by obligations of repayment and remuneration.

The financial intermediary, having received funds, gives in return the obligation to return them under certain conditions. In turn, the funds received are in some combination provided by the financial intermediary to some borrower also under the obligation to return them with remuneration. Depending on the financial instruments used, the return of funds can be carried out indirectly, through capital market mechanisms.

Financial intermediation is beneficial for many reasons. First, not all savers are specialists in financial operations who understand the intricacies of loan transactions. Second, even having some knowledge of such operations, a saver, when using the services of professionals, is relieved of the need to search for a specific variant of investing funds, i.e. saves his own time and resources for engaging in his main business. Third, the saver’s money begins to work. Fourth, the saver earns income, forcing the financial intermediary to make effective use of the funds he receives. Fifth, intermediaries can be used to diversify, reduce, or transfer risk to another person. Sixth, financial intermediaries can accumulate large amounts of cash and, once concentrated, invest it in projects potentially inaccessible to small investors or savers.

Financial transformation consists in the fact that short-term (financial) assets and liabilities can be transformed into long-term ones. This is achieved, in particular, by securitization of assets, when a credit institution pools its loans secured by relatively homogeneous assets and issues securities against common collateral. The opposite is also possible – “borrow short, lend long. For example, a company needs to invest, but cannot raise the necessary amount of money on a long-term basis. Then it makes short loans and invests them in a long-term project; this requires periodic prolongation of short loans, as well as confidence in the sufficiency of current income to pay the interest and principal of the short loan. Of course, there is a higher risk of rising interest rates. Some certainty in the renewability of sources of short-term financing is necessary.

Approximately the same logic is laid down in the operations of banking and investment structures, when funds raised for a short period are invested in a long-term project. Here two circumstances are taken into account:

a) the accuracy of settlements with short-term investors and therefore avoiding the situation when in a panic they will want to return their funds at once (even with possible losses);
b) the law of large numbers works in this case, when in the presence of many depositors fluctuations in the amounts of withdrawn funds are leveled out.

Risk transfer. The overwhelming majority of financial operations are risky by their nature; that is why in the process of their realization there always arises a desire to either avoid risks or reduce them. It is reached by different means, in particular by reception of guarantees and securities, and transfer of a part of risk to a financial intermediary.

Organization of currency transactions. In modern economics the great majority of companies are more or less connected with currency operations. In a developed market economy these operations are predetermined by the desire of the company to enter international markets of goods and factors of production. In the developing economy other reasons of currency operations are also valid – desire to create joint ventures, find a foreign investor, open foreign representation, to get from abroad new engineering and etc. In most cases such operations are performed via financial institutions.

Promotion of liquidity. Any company needs cash (in this case we mean cash on hand and on settlement accounts), but how much should be their volume is a matter of debate. Since current activity (including cash inflows and outflows) by definition cannot be rigidly predetermined, there is always a problem of creating a reserve of cash that could be used when, for example, the time came for repayment of accounts payable, but the money from the debtor, on which the company was counting, never came to the account. The simplest version of insurance against such a collision – building up a cash reserve – is not the most profitable, because money lying idle not only does not bring income, but on the contrary, leads to losses (e.g. due to inflation). Therefore, the most reasonable thing is to invest cash in highly liquid financial products offered by financial institutions, e.g. shares, short-term liabilities.

Organization of operations for changing organizational-legal forms of companies. The most typical operation of this kind is the transformation of a company into an open joint-stock company. The logic of business development is such that as the company emerges and the scale of its activities expands, its founders either become unable to provide proper financing for the company or, for various reasons, do not wish to do so. In this case, the company changes its organizational-legal form, becoming an OJSC, and thus obtaining the possibility of additional funding. Since such a procedure is complicated and time-consuming, a specialized financial institution is used for its implementation.

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