Characteristics and Features of Financial Intermediaries - Jose Miguel Artiles Ceballos
Financial Intermediaries are usually engaged in bringing together the big borrowers and big lenders. Their main objective is to convert savings into investments and charge a certain amount of fee for providing their services, which is called Intermediation Cost. Similar to the Intermediation cost, Financial Intermediaries have many different characteristics and features, based on their type. Jose Miguel Artiles Ceballos, the director of Bandenia Formula Capital LTD , is an expert in financial intermediaries and identifies them with the following characteristics. Risk Reduction : When compared to individuals, financial intermediaries have greater resources to bear and spread the risk among different individuals. Moreover, since financial intermediaries are experts in managing diversified portfolios, it reduces the risk through diversification. Apart from this, financial intermediaries carefully screen and examine the borrowers, which greatly reduces the risk of default. They even pro