Financial operations are exchanges of financial capital that are agreed between lenders y borrowers under equivalent conditions, according to a financial law, between capitals delivered between one party and another.
Ambas partes (la prestación y la contraprestación) deben ser financieramente equivalente. Es decir, que la suma financiera de capitales de prestación (S) y la suma financiera de capitales de contraprestación (S') deben coincidir. Se representa como: S = S'
What is the financial operation made of?
The elements involved are:
- The capitals that are exchanged (benefit and consideration). The benefit is the capital delivered by the lender, while the consideration is the capital delivered by the opposing party (borrower), who receives the benefit.
- The agents. The lender is the one who delivers the main benefit and the one who receives the consideration; while the borrower is the one who receives the benefit and the one who delivers the consideration.
- The duration. It is the time between the expiration of the first capital (delivered by the lender) and the delivery of the last one (which can be delivered by the lender or by the borrower).
- The financial law of valuation. It is the expression that we have commented previously and that makes the capital that is delivered by both parties financially equivalent.
Types of financial operation
We can classify financial operations according to different criteria:
- According to the type of capitalization: simple or compound.
- Depending on the term of the operation: short (less than 1 year), medium (between 1 and 3 years), long (more than 3 years), indefinite (according to an agreement between both parties) or perpetual (without expiration).
- According to the certainty in the exchange of capital: certain or defined operations and random operations.
- According to the agents involved: natural persons, legal persons, or both.