What is Benjamin Graham’s Model of Asset Valuation?
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What is Benjamin Graham’s Model of Asset Valuation?

Outside of Warren Buffet, no other investor is as well-known as his mentor Benjamin Graham.

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Why is analysing Cash Flow Statements Important?
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Why is analysing Cash Flow Statements Important?

Cash flow statement is an important financial statement that analyses and summarises the amount of cash and cash equivalents that enter and leave the company. It measures how effectively a company is utilising its cash balances that is, how well it manages its operating expenses and how well it generates cash to pay its debts.

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Does your company have enough Liquidity?
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Does your company have enough Liquidity?

Your company’s revenue figures are great to flaunt, but they don’t ultimately mean much if your cash flow is out of whack. Profit offers peace of mind, surely, but it doesn’t indicate that your business financials are sound. Only stable, reliable cash flows can truly demonstrate success. 

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What is the Fixed Asset Turnover (FAT) Ratio?
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What is the Fixed Asset Turnover (FAT) Ratio?

A fixed asset turnover ratio is an efficiency ratio that shows the return received by a company on the investments made by them in fixed assets such as plant, machinery, equipment, etc., in relation to the total sales generated. In other words, it measures how efficiently a company uses its fixed assets to make sales. Creditors and investors refer to this ratio to identify the efficiency of the company in managing its fixed assets. They do so to interpret the returns they might earn on their investments made in the company and make sure that the earnings/revenues from the equipment are enough so that the company can pay back the loans that it has taken for it. The formula for calculating the fixed asset turnover ratio 

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Why is it important to understand your investments?
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Why is it important to understand your investments?

“Caveat Emptor” or “Buyers Beware” is the central theme that runs across the world of investing.  Every investor should have truckloads of knowledge about the investing world and where they are investing in. In this Monetary world, people want quick money.. easy money.. fast money.. And for this, they often resort to fraudulent activities, embezzlement, treachery, etc.

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5 components of P&L that influence Investor
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5 components of P&L that influence Investor's Decisions

Ever wondered about what makes a person invest in one company and not in another?

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5 components of Balance Sheet that influences Investment Decisions
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5 components of Balance Sheet that influences Investment Decisions

People in current markets are inclined towards making profits and increasing their earnings. They want to invest in sectors and companies that are at their booming phase and would probably provide them with the highest returns. But how are their investment decisions made by their individuals? On what grounds do they decide whether they should invest in one particular company or another? These decisions are made by referring to the financial statements of the company and studying their growth pattern over the years. Financial statements such as Balance Sheet, Profit, and Loss accounts, Cash Flow Statements, etc. reflect the position of the company in terms of profitability and liquidity. It tells us where the company has made its investments and how much reserves it has created by now and how much money does it need to run its business on a daily basis and the kind of liquidity it has. Now, let us go through the 5 components of the balance sheet that influence the investment decisions of the investors:

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Impact of inflation on Indian Stock Market
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Impact of inflation on Indian Stock Market

What is stock market and stock exchange?

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Special purpose vehicle (SPV)
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Special purpose vehicle (SPV)

In the current financial market, there exists numerous enterprises and entities who are working towards providing goods and services to the nation and contribute to the growth of the economy.

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What is Inflation and Index fund
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What is Inflation and Index fund

With the opening up of the economies and the growth in various sectors, numerous enterprises spread over sectors like FMCG, education, banking, automobile, healthcare etc. have been set up which provide the people with goods and services which are needed and essential for the survival as well as improvement in the standard of living. As these enterprises set up and grow, they require funds to operate which can be in the form of equities or debt from the outside investors for a specified or an unlimited period of time. The sources from where such organizations can raise funds can be: equities, loans, mutual funds, debentures, bonds etc.

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What is credit rating
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What is credit rating

Before we go about on how credible the credit ratings are, allotted by the rating companies, it is important to have a clear understanding of what these credit ratings are? How do they function? And who actually assigns these ratings to companies?

Continue Reading about 1 years ago