The financial account is one of the two major components under the financial and capital account. The major components of the financial account are:
-direct investment;
-portfolio investment;
- other investment;
-reserve assets.
The financial account records an economy’s transaction in external financial assets and liabilities. The major classifications in the financial account are:
- Functional type of investment (direct investment, portfolio investment, other investment, and reserve assets);
- Assets (residents’ financial claims on non resident) and liabilities non resident financial claims on resident);
- Instrument of investment (e.g. equity, debt);
- Sector of the domestic transactor (general government, monetary authorities, banks and other sectors)