DCM6206 MANAGEMENT OF FINANCIAL INSTITUTIONS, MARKETS AND SERVICES JAN FEB 2026

Description

SESSION	JAN-FEB 2026
PROGRAM	MASTER OF COMMERCE (M.COM)
SEMESTER	II
COURSE CODE & NAME	DCM6206 MANAGEMENT OF FINANCIAL INSTITUTIONS, MARKETS AND SERVICES

 

 

Assignment Set – 1

 

Q.1. Describe the various types of Money Market Instruments. (10 Marks)

Ans 1.

Money market a section of the financial markets in where short-term financial instruments that have durations of one year at most are exchanged. The market provides the borrower with an efficient mechanism to meet their immediate liquidity requirements. It also gives investors a secured way to use surplus funds over short durations. A variety of different instruments are offered on the market. They each serve the purpose of investment and liquidity.

Treasury Bills (T-Bills)

Treasury Bills are short-term borrowing instruments issued by the Government of India through

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JAN-FEB 2026

 

 

Q.2. Describe the different categories of financial services and how do they shape economic activities. (6+4 = 10 Marks)

Ans 2.

Categories of Financial Services

Financial services cover a wide array of tasks that allow the transfer of money between borrowers and savers, reduce financial risk, and enable economic transactions. They can be broadly classified in a variety of categories, based on their function and the type of benefit they offer customers.

Fund-Based Services involve the application of funds by the financial institution. They include

 

 

Q.3. Explain the concept of Venture Capital. Discuss the various methods of venture capital financing. (4+6 = 10 Marks)

Ans 3.

Concept of Venture Capital

Venture Capital (VC) is the name of a type of private equity funding offered through professional investors and investment companies to young firms with a high-growth potential who usually are not able to get traditional bank loans because of their absence of cash flow history and collateral assets or track record of profitability. Venture capitalists make investments in exchange for an ownership stake in the business by becoming part owners of the company and

 

Assignment Set – 2

 

Q.4. Examine the role of credit rating as a financial service and describe its process. (3+7 = 10 Marks)

Ans 4.

Role of Credit Rating as a Financial Service

The credit rating process is an expert evaluation of the creditworthiness of an organisation, debt instrument or sovereign which is expressed in the form of a standardised alphanumeric symbol which indicates the likelihood of falling into default on financial obligations. Rating agencies for credit, such as CRISIL, ICRA, CARE along with India Ratings within India, and Moody’s, Standard and Poor’s, and Fitch across the globe, provide the service. Credit ratings provide

 

 

Q.5. Differentiate between factoring and forfeiting. Establish comparison between loan syndication and loan consortium. (5+5 = 10 Marks)

Ans 5.

Factoring vs Forfeiting

Factoring is a type of financial service that allows a business to sell its receivables from trade that are short-term (invoices) to a financier, also known as an factor at a reduced price. The factor advances a large proportion of the invoice’s value in a short time, usually around 80-90 percent and collects the loan from the purchaser upon its maturity. Factoring allows the seller to have immediate working capital without waiting for the expiration of the credit period and

 

 

Q.6. Illustrate the concept of Securitization and discuss in detail advantages of securitization. (4+6 = 10 Marks)

Ans 6.

Concept of Securitization

Securitization is a financial process wherein illiquid financial assets such as mortgages, loans trade receivables and credit card receivables, and lease rental are pooled and then converted into marketable security that are then offered to investors on the capital market. This process involves transfer of the pools of assets from the source that is usually an institution or bank that originally created the assets into a Special Purpose Vehicle (SPV) which is an independent legal entity that was specifically