The work of the Stock Exchange

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XI. The security collateral loan market

Collection:: Economics Books

SECURITY COLLATERAL LOAN MARKET 201 consists in the face of the envelope itself, made out as above described Diversification of Security Collateral.—One reason for the essential safety of security loans consists in the care exer- cised in diversifying their collateral. Each loan is thus a sort of miniature investment trust. The high degree of organiza- tion in the security loan market has developed an extensive technical practice in this respect. Years ago, American railway shares constituted a larger proportion of Stock Exchange turnover and listings than to- day, and were in addition more stable as a rule than American industrial shares. In consequence, many “all-rail” loans used to be made, as follows: ALL-RAIL Loan oF $100,000 Based entirely on railroad stocks. Margin about 299%, 200 Delaware & Hudson R. R. at 190. . t 100 New York Central R. R. at 193.. 300 Erie R. R. at 78... 200 Northern Pacific R. R. at 103... 200 Illinois Central R. R. at 138.. 38,000 9,300 3,400 ‘0c [,000 As industrial issues assumed increasing importance ang stability in the market, they came to be included in loan col- lateral. Thus additional diversification was provided. In fact, before the war, the favorite selection of such collateral con- sisted of two-thirds rails and one-third industrials, and was known as the “regular” loan on “mixed” collateral. OLp RecuLAr LoaN oF $100,000 Based on mixed collateral, %3 rails and 14 industrials. about ; - 200 Southern Railway at 138.. 300 Pennsylvania R. R. at 77... 300 Baltimore & Ohio R. R. at 124. 200 Consolidated Gas at FIZ cnvanevinnn 200 American & Foreign Power at 104. 27,400 23,100 37,200 22,600 20.800 [ 200 $121.100

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