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52-1187: (Redirected from International Finance Centre ) International Finance Centre , or International Financial Centre , or IFC may refer to one of the following: Finance hub [ edit ] Finance centre Offshore financial centre Buildings [ edit ] International Finance Centre (Hong Kong) International Finance Center Seoul Busan International Finance Center Busan International Finance Center–Busan Bank Station Guangzhou International Finance Center JW Marriott International Finance Centre Ping An Finance Centre Rose Rock International Finance Center Shanghai IFC Shenyang International Finance Center Suzhou IFS See also [ edit ] All pages with titles beginning with International Finance Centre All pages with titles beginning with International Finance Center All pages with titles containing International finance centre All pages with titles containing International finance center Chongqing International Trade and Commerce Center International Commerce Centre Topics referred to by

104-426: A normal distribution , but are rather modeled better by Lévy stable distributions . The scale of change, or volatility, depends on the length of the time unit to a power a bit more than 1/2. Large changes up or down are more likely than what one would calculate using a normal distribution with an estimated standard deviation . Simply put, primary market is the market where the newly started company issued shares to

156-557: A broad impact on market participants' operating models and strategies. Seemingly, the most obvious buyers and sellers of currency are importers and exporters of goods. While this may have been true in the distant past, when international trade created the demand for currency markets, importers and exporters now represent only 1/32 of foreign exchange dealing, according to the Bank for International Settlements . The picture of foreign currency transactions today shows: Much effort has gone into

208-463: A centre for finance in the Middle East , including for Islamic finance . The rapid rise of India has enabled Mumbai to become an emerging financial centre. India is also making an International Financial Centre GIFT City from scratch. GIFT city is now functional and has already won the crown of fastest emerging International Finance Centre of South Asia. Linked to the rise of these new IFCs, has seen

260-524: A financial city: "a pool of capital to lend or invest; a decent legal and taxation framework; and high-quality human resources". New York, London, and Tokyo are in every list of major IFCs. Some of the major RFCs (see below), such as Paris, Frankfurt, Chicago, and Shanghai appear as IFCs in some lists. These centres appear in all FSF–IMF lists of OFCs and, bar the Caribbean OFCs of the Cayman Islands,

312-649: A financial market is a stock exchange . A company can raise money by selling shares to investors and its existing shares can be bought or sold. The following table illustrates where financial markets fit in the relationship between lenders and borrowers: The lender temporarily gives money to somebody else, on the condition of getting back the principal amount together with some interest or profit or charge. Many individuals are not aware that they are lenders, but almost everybody does lend money in many ways. A person lends money when he or she: Companies tend to be lenders of capital. When companies have surplus cash that

364-572: A group of borrowers. They can also take an organizational form like Mutual Funds. They can provide mortgage on weight basis. The main advantage is that this lowers the cost of their borrowings. During the 1980s and 1990s, a major growth sector in financial markets was the trade in so called derivatives . In the financial markets, stock prices, share prices, bond prices, currency rates, interest rates and dividends go up and down, creating risk . Derivative products are financial products that are used to control risk or paradoxically exploit risk. It

416-542: A leading international financial centre since the 19th century , acting as a centre of lending and investment around the world. English contract law was adopted widely for international finance , with legal services provided in London. Financial institutions located there provided services internationally such as Lloyd's of London (founded 1686) for insurance and the Baltic Exchange (founded 1744) for shipping. During

468-527: A major financial centre in the 1980s as the Japanese economy became one of the largest in the world. Hong Kong and Singapore developed soon after leveraging their links with London and Britain. In the 21st century, other centres have grown including Toronto, Sydney, Seoul, Shanghai and Astana . Astana International Financial Centre has become the fastest growing financial hub in Central Asia. Dubai has become

520-520: A physical location (such as the New York Stock Exchange (NYSE), London Stock Exchange (LSE), Johannesburg Stock Exchange JSE Limited (JSE), Bombay Stock Exchange (BSE), National Stock Exchange of India (NSE) or an electronic system such as NASDAQ . Much trading of stocks takes place on an exchange; still, corporate actions (merger, spinoff) are outside an exchange, while any two companies or people, for whatever reason, may agree to sell

572-420: A wide range of financial services , for example relating to mergers and acquisitions , public offerings , or corporate actions ; or which participate in other areas of finance , such as private equity , hedge funds , and reinsurance . Ancillary financial services include rating agencies , as well as provision of related professional services , particularly legal advice and accounting services. As of

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624-1212: A working paper on OFCs, but which also proposed a taxonomy on classifying the various types of global financial centres, which they listed as follows (with the description and examples they noted as typical of each category, also noted): The IMF noted that the three categories were not mutually exclusive and that various locations could fall under the definition of an OFC and an RFC, in particular (e.g. Singapore and Hong Kong were cited). International Financial Centres, and many Regional Financial Centres, are full–service financial centres with direct access to large capital pools from banks, insurance companies, investment funds, and listed capital markets, and are major global cities . Offshore Financial Centres, and also some Regional Financial Centres, tend to specialise in tax-driven services, such as corporate tax planning tools , tax–neutral vehicles, and shadow banking / securitisation , and can include smaller locations (e.g. Luxembourg ), or city-states (e.g. Singapore). Since 2010, academics consider Offshore Financial Centres synonymous with tax havens . The IMF noted that OFCs could be set up for legitimate purposes (listing various reasons), but also for what

676-403: Is a crucial aspect of securities that are traded in secondary markets. Liquidity refers to the ease with which a security can be sold without a loss of value. Securities with an active secondary market mean that there are many buyers and sellers at a given point in time. Investors benefit from liquid securities because they can sell their assets whenever they want; an illiquid security may force

728-458: Is a diverse range of financial centres worldwide. While New York and London often stand out as the leading global financial centres, other established financial centres provide significant competition and several newer financial centres are developing. Despite this proliferation of financial centres, academics have discussed evidence showing increasing concentration of financial activity in the largest national and international financial centres in

780-418: Is also called financial economics. Derivative products or instruments help the issuers to gain an unusual profit from issuing the instruments. For using the help of these products a contract has to be made. Derivative contracts are mainly four types: Over the past few decades, the derivatives market has increased and become essential to the financial industry. As the market expands, establishing and improving

832-953: Is different from Wikidata All article disambiguation pages All disambiguation pages Finance centre A financial centre ( financial center in American English ) or financial hub is a location with a significant concentration of participants in banking asset management , insurance , and financial markets , with venues and supporting services for these activities to take place. Participants can include financial intermediaries (such as banks and brokers), institutional investors (such as investment managers, pension funds , insurers, and hedge funds ), and issuers (such as companies and governments). Trading activity can take place on venues such as exchanges and involve clearing houses , although many transactions take place over-the-counter (OTC), directly between participants. Financial centres usually host companies that offer

884-448: Is not needed for a short period of time, they may seek to make money from their cash surplus by lending it via short term markets called money markets . Alternatively, such companies may decide to return the cash surplus to their shareholders (e.g. via a share repurchase or dividend payment). Banks can be lenders themselves as they are able to create new debt money in the form of deposits. Governments borrow by issuing bonds . In

936-860: The Global Financial Centres Index and the Xinhua–Dow Jones International Financial Centres Development Index . The Global Financial Centres Index ("GFCI") is compiled semi-annually by the London -based think tank Z/Yen in conjunction with the Shenzhen -based think tank China Development Institute . The 36th edition of the GFCI was published in September 2024. Old finance centres such as Amsterdam, London, Paris, and New York have long histories . Today there

988-570: The Italian city-states (such as Venice and Genoa ) of the late medieval and early Renaissance periods while Florence can be said to be the birthplace of double-entry bookkeeping from the publication and proliferation of the work of Luca Pacioli . In the sixteenth century, the overall economic supremacy of the Italian city-states gradually waned, and the centre of financial activities in Europe shifted to

1040-457: The Low Countries , first to Bruges , and later to Antwerp and Amsterdam which acted as Entrepôt cities. They also became important centres of financial innovation, capital accumulation and investment. By the early 1800s, London officially replaced Amsterdam as the world's leading financial centre. London and Paris were the world's only prominent financial centres throughout most of

1092-589: The 11th century in the Kingdom of England at the annual fair of St. Giles and in the Kingdom of Germany at the Frankfurt autumn fair, then developed in medieval France during the Champaign Fairs. The first real international financial centre was the city state of Venice which slowly emerged from the 9th century to its peak in the 14th century. Tradable bonds as a commonly used type of security, were invented by

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1144-595: The 19th century. After 1870, Berlin and New York grew to become major financial centres mainly serving their national economies. An array of smaller international financial centres found market niches , such as Amsterdam, Brussels , Zurich , and Geneva . London was the leading international financial centre in the four decades before World War I . Since then, New York and London have developed leading positions in different activities and some non-Western financial centres have grown in prominence, notably Tokyo , Hong Kong , Singapore and Shanghai . London has been

1196-582: The 2024 edition of the Global Financial Centres Index , New York City , London and Hong Kong ranked top 3 globally, while other well known financial centres include Singapore , Shanghai , Frankfurt and Tokyo , amongst others. In April 2000, the Financial Stability Forum ("FSF"), concerned about OFCs on global financial stability produced a report listing 42 OFCs. In June 2000, the International Monetary Fund (IMF) published

1248-477: The 20th century London played an important role in the development of new financial products such as the Eurodollar and Eurobonds in the 1960s, international asset management and international equities trading in the 1980s, and derivatives in the 1990s. London continues to maintain a leading position as a financial centre in the 21st century, and maintains the largest trade surplus in financial services around

1300-477: The 21st century. Others have discussed the ongoing dominance of New York and London, and the role linkages between these two financial centres played in the financial crisis of 2007–08 . Comparisons of financial centres focus on their history, role and significance in serving national, regional and international financial activity. Each centre's offering includes differing legal, tax and regulatory environments. One journalist suggested three factors for success as

1352-539: The British Virgin Islands, and Bermuda, represent all the major OFCs. Some also appear as RFCs in various lists, particularly Hong Kong, and Singapore. They also appear on most lists of major tax havens , and on lists of the largest Conduit and Sink OFCs in the world. In some lists, RFCs such as Paris, Frankfurt, Chicago, and Shanghai appear as IFCs, however, they do not appear in all lists. They are certainly major RFCs. Primitive financial centres started in

1404-468: The Conduit OFC's extensive networks of global bilateral tax treaties . Because Sink OFCs are more closely associated with traditional tax havens, they tend to have more limited treaty networks and access to global higher–tax locations. Prior to the 1960s, there was little data available to rank financial centres. In recent years many rankings have been developed and published. Two of the most relevant are

1456-469: The European Central Bank, high frequency trading has a substantial correlation with news announcements and other relevant public information that are able to create wide price movements (e.g., interest rates decisions, trade of balances etc.) The scale of changes in price over some unit of time is called the volatility . It was discovered by Benoit Mandelbrot that changes in prices do not follow

1508-493: The IMF called dubious purposes , citing tax evasion and money–laundering. In 2007, the IMF produced the following definition of an OFC: a country or jurisdiction that provides financial services to nonresidents on a scale that is incommensurate with the size and the financing of its domestic economy . The FSF annual reports on global shadow banking use the IMF definition to track the OFCs with

1560-479: The UK, the government also borrows from individuals by offering bank accounts and Premium Bonds . Government debt seems to be permanent. Indeed, the debt seemingly expands rather than being paid off. One strategy used by governments to reduce the value of the debt is to influence inflation . Municipalities and local authorities may borrow in their own name as well as receiving funding from national governments. In

1612-402: The UK, this would cover an authority like Hampshire County Council. Public Corporations typically include nationalized industries. These may include the postal services, railway companies and utility companies. Many borrowers have difficulty raising money locally. They need to borrow internationally with the aid of Foreign exchange markets . Borrowers having similar needs can form into

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1664-511: The academic lists of tax havens include all the FSF–IMF OFCs). In July 2017, a study by the University of Amsterdam 's CORPNET group, broke down the definition of an OFC into two subgroups, Conduit and Sink OFCs : Sink OFCs rely on Conduit OFCs to re–route funds from high–tax locations using base erosion and profit shifting ("BEPS") tax planning tools, which are encoded, and accepted, in

1716-456: The control of customs in China. After the establishment of People's Republic of China, the financial centres in China today are Beijing , Shanghai , and Shenzhen . Financial markets The term "market" is sometimes used for what are more strictly exchanges , that is, organizations that facilitate the trade in financial securities, e.g., a stock exchange or commodity exchange . This may be

1768-403: The financial sector, the term "financial markets" is often used to refer just to the markets that are used to raise finances. For long term finance, they are usually called the capital markets ; for short term finance, they are usually called money markets . The money market deals in short-term loans, generally for a period of a year or less. Another common use of the term is as a catchall for all

1820-416: The focus of new worldwide growth. One source described New York as extending its lead as the world's centre of finance in September 2018; according to Reuters , the think-tank New Financial concluded the "raw" value of domestic and international financial activity like managing assets and issuing equity underscored the position of New York as the world's leading financial centre. New York City remains

1872-421: The form of savings a/c. They can then lend money from this pool of deposited money to those who seek to borrow. Banks popularly lend money in the form of loans and mortgages . More complex transactions than a simple bank deposit require markets where lenders and their agents can meet borrowers and their agents, and where existing borrowing or lending commitments can be sold on to other parties. A good example of

1924-434: The future, at least in the short term. The claims of the technical analysts are disputed by many academics, who claim that the evidence points rather to the random walk hypothesis , which states that the next change is not correlated to the last change. The role of human psychology in price variations also plays a significant factor. Large amounts of volatility often indicate the presence of strong emotional factors playing into

1976-592: The largest centre for trading in public equity and debt capital markets , driven in part by the size and financial development of the U.S. economy . The NYSE and NASDAQ are the two largest stock exchanges in the world. New York also leads in hedge fund management; private equity ; and the monetary volume of mergers and acquisitions . Several investment banks and investment managers headquartered in New York City are important participants in other financial centres. The New York Federal Reserve Bank ,

2028-419: The largest financial centres relative to their domestic economies. Progress from 2000 onwards from IMF – OECD – FATF initiatives on common standards, regulatory compliance , and banking transparency, has reduced the regulatory attraction of OFCs over IFCs and RFCs. Since 2010, academics considered the services of OFCs to be synonymous with tax havens , and use the term OFC and tax haven interchangeably (e.g.

2080-481: The largest within the Federal Reserve System , regulates financial institutions and implements U.S. monetary policy , which in turn influences the world's economy. The three major global credit rating agencies – Standard and Poor's , Moody's Ratings , and Fitch Ratings – are headquartered or co–headquartered in New York City, with Fitch being co–headquartered in London. In Asia , Tokyo emerged as

2132-498: The markets in the financial sector, as per examples in the breakdown below. The capital markets may also be divided into primary markets and secondary markets . Newly formed (issued) securities are bought or sold in primary markets, such as during initial public offerings . Secondary markets allow investors to buy and sell existing securities. The transactions in primary markets exist between issuers and investors, while secondary market transactions exist among investors. Liquidity

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2184-399: The price. Fear can cause excessive drops in price and greed can create bubbles. In recent years the rise of algorithmic and high-frequency program trading has seen the adoption of momentum, ultra-short term moving average and other similar strategies which are based on technical as opposed to fundamental or theoretical concepts of market behaviour. For instance, according to a study published by

2236-616: The regulatory framework becomes particularly critical. In response to the systemic risks exposed by the global economic crisis in 2008, essential regulations such as the Dodd-Frank Act (US) and the EU Market Fundamentals Regulation (MiFID II) were enacted. These regulations have significantly changed the market structure and strengthened supervision and risk management of the derivatives market. Although regulatory measures have enhanced market stability, they have also had

2288-495: The rise of "partner OFCs" (offshore tax-havens to which funds are routed), such as Taiwan (a major Sink OFC for Asia, and 7th largest global Sink OFC), Mauritius (a major Sink OFC for South Asia, especially India, and Africa, and the 9th largest global Sink OFC). The private nationwide financial system in China was first developed by the Shanxi merchants , with the creation of so-called "draft banks". The first draft bank Rishengchang

2340-452: The same term [REDACTED] This disambiguation page lists articles associated with the title International finance centre . If an internal link led you here, you may wish to change the link to point directly to the intended article. Retrieved from " https://en.wikipedia.org/w/index.php?title=International_finance_centre&oldid=909678705 " Category : Disambiguation pages Hidden categories: Short description

2392-741: The second largest concentration of hedge funds (847 according to HedgeLists.com). London benefits from its position between the Asia and U.S. time zones, and benefited from its location within the European Union , although this ended on 31 January 2020 when the United Kingdom left the European Union following the Brexit referendum of 2016. As well as the London Stock Exchange , the Bank of England ,

2444-663: The second oldest central bank, is in London, although the European Banking Authority moved to Paris after Brexit. Since the middle of the 20th century, New York City, represented by Wall Street in Manhattan's Financial District , has been described as a leading financial centre. Over the past few decades, with the rise of a multipolar world with new regional powers and global capitalism , numerous financial centres have challenged Wall Street, particularly London and several in Asia, which some analysts believe will be

2496-664: The seller to get rid of their asset at a large discount. Financial markets attract funds from investors and channels them to corporations—they thus allow corporations to finance their operations and achieve growth. Money markets allow firms to borrow funds on a short-term basis, while capital markets allow corporations to gain long-term funding to support expansion (known as maturity transformation). Without financial markets, borrowers would have difficulty finding lenders themselves. Intermediaries such as banks , Investment Banks , and Boutique Investment Banks can help in this process. Banks take deposits from those who have money to save on

2548-518: The stock from the one to the other without using an exchange. Trading of currencies and bonds is largely on a bilateral basis, although some bonds trade on a stock exchange, and people are building electronic systems for these as well. There are also global initiatives such as the United Nations Sustainable Development Goal 10 which has a target to improve regulation and monitoring of global financial markets. Within

2600-424: The study of financial markets and how prices vary with time. Charles Dow , one of the founders of Dow Jones & Company and The Wall Street Journal , enunciated a set of ideas on the subject which are now called Dow theory . This is the basis of the so-called technical analysis method of attempting to predict future changes. One of the tenets of "technical analysis" is that market trends give an indication of

2652-475: The world. However, like New York, it faces new competitors including fast-rising eastern financial centres such as Hong Kong and Shanghai. London is the largest centre for derivatives markets , foreign exchange markets , money markets , issuance of international debt securities , international insurance , trading in gold, silver and base metals through the London bullion market and London Metal Exchange , and international bank lending . London has

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2704-576: Was created in 1823 in Pingyao . Some large draft banks had branches in Russia, Mongolia and Japan to facilitate the international trade. Throughout the nineteenth century, the central Shanxi region became the de facto financial centres of Qing China. With the fall of Qing Dynasty, the financial centres gradually shifted to Shanghai , mainly due to its geographical location at the estuary of the Yangtze River and to

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