Level 2B liquid assets and Penny shares: Difference between pages

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imported>Doug Williamson
(Create the page. Sources: linked pages.)
 
imported>Doug Williamson
(Create page - source - FCA - https://www.fca.org.uk/consumers/penny-shares)
 
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''Bank regulation - liquidity''
1.  ''Investment - investment strategies - equities - listed equities.''


Level 2B liquid assets are those of lower liquidity quality, compared with Level 2A.
An ordinary equity share with a very low current market price.


A common threshold for classifying a share as a penny share in the UK is a maximum current market price of GBP 0.20 = 20 pence 1 per share.


Level 2B liquid assets are subject to correspondingly greater haircuts when included in the computation of total HQLAs, compared with Level 2A.
 
Investing in such shares can be appealing to certain very naive investors, on the basis that the potential for large proportionate gains - for example a doubling of the value per share - could be considered more likely than for a stock with a higher current market price per share.
 
 
They are generally very high risk investments, and unsuitable for non-professional investors.
 
 
2.  ''Investment - investment strategies - equities.''
 
Shares in very small companies, whose shares may have a very low market value per share.




== See also ==
== See also ==
* [[Credit Quality Step]]
* [[Equity]]
* [[Haircut]]
* [[Financial Conduct Authority]] (FCA)
* [[HQLA]]
* [[Ordinary shares]]
* [[Level 1 liquid assets]]
* [[Penny]]
* [[Level 2 liquid assets]]
* [[Penny stock]]
* [[Level 2A liquid assets]]
* [[Preference shares]]
* [[Liquidity buffer]]
* [[Share]]
* [[Stock]]
 
 
==External link==
*[https://www.fca.org.uk/consumers/penny-shares Find out why you should be cautious about investing in penny shares or penny stocks - UK Financial Conduct Authority (FCA)]
 
[[Category:Accounting,_tax_and_regulation]]
[[Category:The_business_context]]
[[Category:Corporate_finance]]
[[Category:Investment]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]
[[Category:Financial_products_and_markets]]

Latest revision as of 16:09, 10 February 2022

1. Investment - investment strategies - equities - listed equities.

An ordinary equity share with a very low current market price.

A common threshold for classifying a share as a penny share in the UK is a maximum current market price of GBP 0.20 = 20 pence 1 per share.


Investing in such shares can be appealing to certain very naive investors, on the basis that the potential for large proportionate gains - for example a doubling of the value per share - could be considered more likely than for a stock with a higher current market price per share.


They are generally very high risk investments, and unsuitable for non-professional investors.


2. Investment - investment strategies - equities.

Shares in very small companies, whose shares may have a very low market value per share.


See also


External link