Financials

Alternative Investment Fund In the dynamic world of finance, investors are constantly seeking avenues that offer diversification, higher returns, and risk mitigation. One such instrument that has gained prominence in recent years is the Alternate Investment Fund (AIF). In this blog post, we will delve into the fundamentals of AIFs, exploring what they are, how […]

How does price discovery take place in the stock market? Let us say a company makes Rs.1000/- as profit. Also, let us assume the company has 100 shares. So, earnings per share (EPS) i.e., profit / no. of shares = Rs.1000 / 100 = 10. Let us say the price per share in the market

We know that ‘Velocity of money’ – which is a term used to denote the number of times a unit of money in an economy changes hands during a certain period, say, one year. Here, by money, economists mean currency and coins in circulation and bank reserves with the central bank. The life of money

Let us say you have Rs.1,00,000/- with you. With the Rs.1,00,000/- you start a business. The business earns Rs.20,000/- per year. You have added to the value of Rs.1,00,000/- By Rs.20,000/- This is known as investment because you increase the value of the money. Let us say you buy a Car with this Rs.1,00,000/-. If

LIBOR is an acronym for London Inter Bank Offered Rate. LIBOR serves as a benchmark that gives an indication of the rate at which banks can borrow from London interbank market for a given period of time. The interbank borrowing is undertaken by financial institutions either to make profits or to cover short-term liquidity shortfalls.

Many magazines mention that “to improve exports, the central banks need to depreciate the currency.” However, what does it mean and how do exports get a boost by depreciating the currency? To understand how lowering the exchange rate of a currency affects exports of the country, Let us understand through a story…. Mr. A is

Rising interest rates come as sad news for those who wish to take a home loan or a car loan. However, rising interest rates bring several opportunities with them as well… And one opportunity in this regard is that of ‘Carry Trade,’ which means borrowing in one market where interest rates are lower and investing

India Inflation Rate reported at 0.27% for the week ending March 14, 2009! This had been the lowest since 1977. Did we go into negative space ? Yes, it was around – 0.36%. Will it happen next time? Did we head for deflation or was its disinflation? What are these terms and how do they

The PEG Ratio or Price Earnings to Growth Ratio determines a stock’s value while considering future earnings growth. Like the P/E Ratio, the PEG Ratio is used to get a better understanding of whether a company’s stock is overpriced, underpriced or right (priced). The PEG Ratio uses the P/E Ratio of a company and compares

Let’s assume you suddenly have a guest at home and you are running short of milk to prepare tea. In such a scenario you will have no option but to borrow some from your neighbors, which you can replace later. Likewise, external means non-Indian / foreign source, commercial would mean engaged in commerce and borrowing