World Of Finance

        World of Finance by M.Vijaya Sai Round one in the unseemly quarrel between two financial regulators — the Securities and Exchange Board of India, or Sebi, and the Insurance Regulatory and Development Authority of India, or IRDA — on who should supervise ULIPs (unit-linked insurance plans), has gone to IRDA. The government has brokered a temporary truce, leaving the matter to be settled in court. But, for IRDA, it may turn out to be a case of winning a battle but losing the war. The debate is whether ULIPs, which are nothing but mutual fund schemes with the added protection of an insurance cover, should be regulated by Sebi or by IRDA. Sebi, the capital markets regulator, has pointed out that the attributes of ULIPs are very different from traditional insurance products, which is correct. But barring 14 insurance companies from selling ULIPs, was — to say the least — a hasty and thoughtless move on Sebi’s par...

The ABC of Stock Market The Do’s and Don’ts Basics of Stock/Commodity market Stock Market is a place where the trading takes place. A place where lots of money is invested to buy stocks and lots of money is earned while selling stocks. Some people goes with profit and some people carries losses. But still for a trader it’s a everyday game. And in games there are certain rules and regulations to be followed then only you can’t make strategies and plans and play the game according to it and win it. For a new trader the first thing to know about is where to invest, how to invest, how much to invest and win the game of investment. Now the question is how to invest? When an investor starts investing in the stocks or the commodity market he has some prominent exchanges to invest in. Few important ones are as follows: 1. BSE (Bombay Stock Exchange ): BSE is the oldest stock exchange in Asia and has the greatest number of listed companies in the world, with 4700 listed as of August 20...

        World of Finance by M.Vijaya Sai You protect physical property with security systems and watchdogs, you protect your intellectual property with a patent, copyright, or trademark. To use these safeguards, you need to know the steps involved in the patent process, the basics of copyright protection, and how to identify your design, idea, or other creative work legally. You can use trade secrets to protect yourself and your work as well, and to speak the lingo, you need to become familiar with a new set of acronyms. The Patent Process A patent is the most expensive and complex type of IP ( intellectual property) right. Decide whether you can protect your IP with a copyright, trademark, or service mark, or by keeping it under wraps as a trade secret before you go though the patent process. If you and your IP professional decide that a patent is the way to go, and you have the time and money to see the process through t...

        World of Finance by M.Vijaya Sai What's the problem in Greece? Years of unrestrained spending, cheap lending and failure to implement financial reforms left Greece badly exposed when the global economic downturn struck. This whisked away a curtain of partly fiddled statistics to reveal debt levels and deficits that exceeded limits set by the eurozone. How big are these debts? National debt, put at €300 billion ($413.6 billion), is bigger than the country's economy, with some estimates predicting it will reach 120 percent of gross domestic product in 2010. The country's deficit -- how much more it spends than it takes in -- is 12.7 percent. So what happens now? Greece's credit rating -- the assessment of its ability to repay its debts -- has been downgraded to the lowest in the eurozone, meaning it will likely be viewed as a financial black hole by foreign investors. This leaves the country struggling to pay its bills as...

What is PPF…..??? Public Provident Fund (PPF) is a long-term, government-backed small savings scheme of the Central government started with the aim of providing old age income security to the workers in the unorganized sector and self-employed individuals. Currently, there are more than 30 lakh PPF account holders in India. An individual can have only one PPF account in India. Also, two adults cannot open a joint PPF account. The aggregate annual contribution towards PPF cannot exceed Rs.70,000 otherwise the excess amount will be returned without any interest. Currently, the interest rate offered through PPF is around 8 per cent, which is compounded annually. Interest is calculated on the lowest balance between the fifth day and last day of the calendar month and is credited to the account on March 31 every year. So to derive the maximum, the deposits should be made between 1st and 5th day of the month. People who are interested in liquidity or small-term gains would not be i...

        World of Finance by M.Vijaya Sai  Applications of Calculations in Time  Value Of Money   I. MORTGAGES Most of the problems from the time value material are likely to ask for either PV or FV and will provide the other variables. However, on a test with hundreds of problems, the CFA exam will look for unique and creative methods to test command of the material. A problem might provide both FV and PV and then ask you to solve for an unknown variable, either the interest rate (r), the number of periods (N) or the amount of the annuity (A). In most of these cases, a quick use of freshmen-level algebra is all that's required. We'll cover two real-world applications – each was the subject of an example in the resource textbook, so either one may have a reasonable chance of ending up on an exam problem. Annualized Growth Rates The first application is annualized growth rates. Taking the formula for FV of a single s...

        World of Finance by M.Vijaya Sai Reference: DeFusco, McLeavey, Pinto, Runkle, Quantitative Methods for Investment Analysis, 2nd edition, Chapter 1 (pages 1-55). I. BASICS The principle of time value of money – the notion that a given sum of money is more valuable the sooner it is received, due to its capacity to earn interest – is the foundation for numerous applications in investment finance. Central to the time value principle is the concept of interest rates. A borrower who receives money today for consumption must pay back the principal plus an interest rate that compensates the lender. Interest rates are set in the marketplace and allow for equivalent relationships to be determined by forces of supply and demand. In other words, in an environment where the market-determined rate is 10%, we would say that borrowing (or lending) $1,000 today is equivalent to paying back (or receiving) $1,100 a year from now. Here it is sta...