Agency -- Generally, a contract between two parties designating a principal and an Agent who is authorized to act on behalf of the principal in dealings with a third party.
In finance, it refers to specific accounts in trust institutions that are managed as a rule by trust officers in the interest of customers. For individuals, a bank may serve as an agent. For corporations, the services of an agency are concerned with the buying and selling of stocks .
In the domain of government, agency securities are those issued by government-sponsored bodies and federally linked organizations. These securities do not have to comply with registration prerequisites of the Securities and Exchange Commission (SEC).
In investment dealings, it is the purchase and disposal of stocks upon the account and hazard of a client. By and large, the agent or broker is no more than a go-between for buyer and seller, collecting a commission for service rendered and taking no risk either personally or as part of a company.
Agency -- An agency is created by an agreement by which one person delegates to another authority to act for him. Agency in the sense of influence on prices in the speculative markets means the same as factor and (sometimes) element.
About the author
Copyright © 2007 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.