World Of Finance

        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 interest rates on

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 sum of money and solving for r produces a

        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 stated another way: enough borrowers

        World of Finance by M.Vijaya Sai Introduction The Quantitative Methods section of the CFA curriculum has traditionally been placed second in the sequence of study topics, following the Ethics and Professional Standards review. It's an interesting progression: the ethics discussions and case studies will invariably make most candidates feel very positive, very high-minded about the road on which they have embarked. Then, without warning, they are smacked with a smorgasbord of formulas, graphs, Greek letters, and challenging terminology. We know – it's easy to become overwhelmed. At the same time, the topics covered in this section – time value of money, performance measurement, statistics and probability basics, sampling and hypothesis testing, correlation and linear regression analysis – provide the candidate with a variety of highly essential analytical tools and are a crucial prerequisite for the subsequent material on fixed income, equities, and por

        World of Finance by M.Vijaya Sai Stock market investment is a game Successful investing requires more than just a little bit of knowhow and a dash of luck. It requires a cool head, an analytical mind, and the ability to make quick money decisions. This is especially true when investing in the Stock Market. Investing naturally comes with a level of risk. The market’s activity fluctuates on a daily basis during the opening and closing bells. Factors Affecting Stock Prices There are two basic factors that affect the movements of stock prices. Fundamental Factors Fundamental Factors Fundamental Factors Following are the major Fundamental Factors which are affecting the price of stocks Demand and supply Market Cap Earnings per share (EPS) Price/Earning Ratio (P/E Ratio Demand and Supply Demand and Supply is the fundamental factors of economics, which holds good for the equity market as well. The price of stock is d

        World of Finance by M.Vijaya Sai As part of continuous endeavour on enhancing investors on stock market trading , here is a CNBC TV18 Classroom session from technical analyst on trading stocks . This session elaborates on stock technical analysis and it's use Share |