Financial Services: Introduction
Segments
Accounting and Tax Preparation
This segment is comprised as services such as auditing accounting records, designing accounting systems, preparing financial statements, developing budgets, preparing tax returns, bookkeeping, billing, and processing payrolls.
Asset Management
In this segment, companies manage the financial assets of corporate, institutional, and individual clients. Their main services include portfolio management and investment advice.
Banking
Companies in this segment accept deposits and make commercial, industrial, and consumer loans.
Insurance
Companies in this segment act as agents to sell insurance policies and annuities underwritten by insurance carriers.
Private Equity
Private equity is a class of assets that consists of equity securities and debt in companies that do not publicly trade on a stock exchange. These types of investments are typically made by private equity firms, venture capital firms, or angel investors.
Venture Capital
Companies in this industry invest capital in new business ventures. These companies provide money to new, rapidly growing companies with new products or services that appear to be promising in exchange for equity in the company.
The Financial Services industry is Fragmented. The production in this industry is divided among a few different companies, however, no single firm has large enough share of the market to be able to influence the industry's direction or price levels.
Primary Demand Drivers
- Consumer income
- Wealth
- Demographics
Profitability Drivers
- Effective marketing
From the Blog 
It has been over a year since Vladimir Putin authorized Russia's “special military operations” in Ukraine, eventually leading to what we now know as the 2022 Russian Invasion of Ukraine. The human cost of the conflict is undeniable. It is difficult to estimate the number of casualties related to this invasion; however, the most extreme estimates by U.S. general Mark Milley suggest that over 100,000 Ukrainian and over 100,000 Russian soldiers have been killed or injured. Milley’s estimates indicate that nearly 40,000 Ukrainian civilians have been killed in the conflict, while UN estimates put that number at closer to 7,000. As a result of this horrific conflict, there has been an overwhelming international response by both governmental and corporate institutions.
In the first eight months of 2021, global M&A activity has grossed $3.6 trillion, the highest mark at this point in the year since at least 1995, when Dealogic started keeping records. This unprecedented volume of activity has been aided by low interest rates, soaring stock prices, and executives’ ability to address the imperfections in their business exposed by the pandemic. The U.S. alone accounted for $2.14 trillion worth of M&A deals this year, while Europe and the Asia-Pacific accounted for $657 billion and $620 billion, respectively. This wave of deal-making has Wall Street setting records as well, as deal advisory revenue has reached new heights for multiple investment banks. It’s no surprise that Goldman Sachs is the best performing stock in the Dow this year, up 56%.
Sources
- SelectUSA (Date Accessed: 6/1/2017)