The Market Warrior

Operating Profit Margin {OPM}

2024-09-22T22:02:00.003+05:30

The operating profit margin is a vital financial metric comes under Profit & Loss statement, which shows how much of a company's profits come from its main business operations before the taxes and the interest are removed. It offers judgment into how effectively a business is handling its company operations while simultaneously earning money.

Suppose a Company ABC producing some finish product from raw material and sales the finish product in the market,

For current year total revenue generated from the sales of finish product are Rs. 10,00,000

Amount required for purchasing Raw material are Rs. 3,00,000

Amount required for operation to convert raw material to finish goods are Rs. 2,00,000

Amount required for Manpower and other fixed expenses are Rs. 2,50,000

These above amounts required for purchase of raw material and for conversion for raw material to finish product and man power and other fixed requirement are comes under expenses

So, the total expense for converting raw material to finish product is Rs. 7,50,000

And the Operating profit = Total Revenue - Total Expenses

= 10,00,000 - 7,50,000

= 2,50,000

Formula for calculating Operating profit margin,

So,

Total Revenue = Rs, 10,00,000

Total Expenses = Rs. 7,50,000

Operating Profit = Rs. 2,50,000

and Finally the Operating Profit Margin = 25 %

Conclusion:

The Operating Profit Margin makes it more straightforward for us to figure out how a company controls and manages its costs. It makes it possible to pinpoint top performers by comparing companies within similar industry. A larger operating profit margin demonstrates an organization's capacity to convert sales into real profit.

Disclaimer: This post is not considered a recommendation to buy, sell, or invest in any company; it is just intended for educational purposes. Do your own research and due diligence before making any investment decision, and talk to your financial advisor.

The Things We Should Know Before Investing In Stock Market

2024-03-24T00:49:00.033+05:30

To My Friends,

To survive, we have to work extremely hard in order to earn money.

And since someone else made a lot of money from the stock market very quickly that attract us also and So with a lot of confusions, we decide to invest our hard-earned money in stock market, in an attempt to increase our own earnings.

Without knowing - What should I purchase? When should I buy? Why should I buy? and then we experience losses in stock market.

No one think on it, why it happened so?

Have you ever thought what is the reason behind these losses?

The answer is pretty clear that the reason is "lack of stock market literacy"

People want to reach some destination but they really don't know the road to destination.

Have you ever considered the things that we must to know before making investments in stock market?

If "YES", that's fine; if "NO", please read the questionnaire below, take note of these questions, and try to answer them.

Below is the questionnaire:

1. What is stock?

2. What is stock market?

3 .What is stock trading?

4. Why stock trading required?

5. How companies get lists into stock market?

6. What is the name of Indian stock market?

7. What is the index? Nifty & Sensex

8. Where is Nifty and Sensex situated?

9. How Nifty moves up and down?

10. What is the Market Capitalization?

11. What is the Large Cap, Mid Cap & Small Cap means?

12. What is difference between Trading & Investment?

13. What are the types of Trading?

14. What are the types of Investment?

15. What is the Fundamental & Technical analysis?

16. What is the use of Fundamental analysis?

17. What is the use of Technical analysis?

18. What is P.E?

19. What is Book Value?

20. What is Dividend / Share?

21. What is Dividend yield?

22. What is Face value?

23. What is ROCE?

24. What is ROE?

25. What is EPS?

26. What is Price to book value?

27. What is Reserve?

28. What is Surplus?

29. What is Equity Capital?

30. What is EBITDA?

31. What is Debt?

32. What is Zero Debt?

33. What is OPM?

34. What is PAT?

35. What is Net Profit?

36. What is Interest & Borrowing?

37. What is Interest Coverage ratio?

38. What is Balance Sheet?

39. What is Profit Loss statement?

40. What is Cash Flow Statement?

41. What is Standalone & Consolidated result?

42. What is the Quarterly result period Q1, Q2, Q3 & Q4?

43. What is Bullish trend and Bearish trend?

44. Who is DII?

45. Who is FII?

46. Who is Promoter?

47. What is Share Holding?

48. What is Sectors?

49. How many sectors are there in Indian stock market?

50. What is mean by market trend?

51. What is Dow, Nasdaq, CAC, DAC, FTSE, Nikkei, Hang Seng, Shanghai Composite?

52. What is the importance of world stock market timing?

53. Which country market opens at what time?

54. Which is the costliest share in the world market?

55. When Nifty & Sensex started?

Honestly try to get answers for all the above questions.

This are very basic information, one should know all these things before making investment in stock market.

I hope this article will help you to improve your stock market knowledge for better investment decisions.

Books For Enhancing Your Stock Market Knowledge

2023-09-30T10:09:00.258+05:30

Books are always our best friends both in our good and bad times.

Books always talk with us, they never leave us alone.

Books have vast and endless knowledge, information and solutions in it.

Please go through below books to enhance your stock market knowledge.

1. A VISIT TO STOCK MARKET ( To Buy Book Click On Image)

A VISIT TO STOCK MATRKET gives very initial basic information about the stock, and stock market to the market beginners.

2. GUIDE FOR STOCK MARKET BEGINNER' ( To Buy Book Click On Image)

GUIDE FOR STOCK MARKET BEGINNER'S This book gives stock market beginners with basic knowledge and information in order to save their time and money. This book will show them, step by step direction, how to get started in the stock market and what they should do in their initial entry phase of stock market.

3. BALANCING FINANCIAL PLANNING ( To Buy Book Click On Image)

BALANCING FINANCIAL PLANNING This book is dedicated to my all-dear friends, who work hard, harder & harder day and night for their family livelihood. But missed to properly align their basic safety requirement of life for their families, when they are with them and when they are not with them. This happens mainly because of less time to investigate, our due to less knowledge of proper investment structure.

This book is for all of them. So that they can learn with less time and increase their basic knowledge and take right decision on right time for right thing. And secure their families.

4. WRITTEN BASED GOAL INVESTMENTS ( To Buy Book Click On Image)

WRITTEN BASED GOAL INVESTMENTS Friends, this book is very help to all of you, for design, selection and alignment of your financial goals. It is very to understand that your financial plan should be designed very minutely considering all our future requirements and the e9ect of inflation in future.

Thorough knowledge of financial planning for selection of proper financial goals will be a major factor in success of financial goals in our life.

So, friends go through this book and smartly plan your future financial goals and enjoy your life.

5. वित्तीय नियोजन संतुलन : Balancing Financial Planning (Hindi Edition) ( To Buy Book Click On Image)

वित्तीय नियोजन संतुलन : Balancing Financial Planning (Hindi Edition) यह पुस्तक मेरे सभी प्यारे दोस्तों को समर्पित है, जो अपने परिवार की आजीविका के लिए दिन-रात कड़ी मेहनत करते हैं। लेकिन अपने परिवारों के लिए, जब वे उनके साथ होते हैं और जब वे उनके साथ नहीं होते हैं, तो उनके जीवन की बुनियादी सुरक्षा की आवश्यकता को ठीक से पूरा करने में चूक जाते हैं। यह मुख्य रूप से जांच के लिए कम समय, उचित निवेश संरचना के कम ज्ञान के कारण होता है।

यह पुस्तक उन सभी के लिए है। ताकि वे कम समय के साथ सीख सकें और अपना मूल ज्ञान बढ़ा सकें और सही समय पर सही काम के लिए सही निर्णय ले सकें। और उनके परिवार को सुरक्षित करें।

Disclaimer: This posts are just intended for educational purposes. Do your own research and due diligence before making any investment decision, and discuss with your financial advisor.

Consistent Investment Habit, Creates Huge Wealth

2023-09-23T20:30:00.007+05:30

Dear Friends,

I want to have a discussion about an important topic with all of you today using an actual scenario.

We've previously talked about the compounding effect. However, after using this illustration, you will see the potential benefits of investing long-term investments more clearly.

Huge wealth may be generated with ease with little, regular investments.

Please make an effort to better understand the depth and concept of long-term investing.

You must choose a company with strong fundamentals and long-term business potential, and you must continue to invest in it through all highs and lows without taking a break.

And you receive a huge reward for your consistency.

The price history and business growth in this example are real, but we are using it as a case study to better understand the concept; hence, I am not providing the stock name.

Please avoid from trying to compare Stock A to any other stock. We shall refer to it as Stock A.

We must first learn and then earn.

In 2009 Stock A price was around Rs.92 and if we started our investment with monthly Rs.2000 in similar way as SIP.

If we continue to invest Rs.2000 every month until Sept. 2023, we would have invested around Rs.354,000 [Rs.3 Lac and 54 Thousand] to date. and roughly 846 Quantities might have been acquired at an average purchase price of 418 per share.

The current value of the investment is Rs.1294084 with a profit of Rs.940084 [if the investment amount is removed]. As on data the CMP for Stock A is Rs.1500. Dividend and stock splits are not included in this profit.

For better understanding and study, all the information is provided in the table below.

See what actually happened now.

We began investing in 2009 with a Rs.92 stock price and made monthly SIP investments of Rs.2000. Again, we made an investment of Rs.354,000 here.

But due to effect of yearly dividend [Dividend Re-invested] and Stock split twice, in its span of 13 yrs. from 2009 to 2023, the amount accumulated is Rs.8793921 [Rs.87 Lac and 93 thousand] w.r.t Stock A CMP Rs.1500.

Taking our initial investment of Rs.354,000 out of the equation, the profit is Rs.8439921.

Please try to under the beauty of long-term consistent investment and effortless reward.

Market Capitalization

2023-09-17T00:04:00.018+05:30

Although it's quite a simple subject, Still it's immensely interesting and significant. This is the initial stage of any stock's fundamental analysis.

It divides the stocks into distinct categories according to the market capitalization of the companies.

So, Let’s go,

What is Market Capitalization?

We will use a single, really straightforward example to illustrate the idea of market capitalization.

However, keep in mind that we commonly refer to this Market Capitalization as "Market Cap."

Returning to our example section...

Suppose we have 10 Mangoes in a box...

The cost of one Mango is Rs.10

Then what is cost of complete Mango box containing 10 Mangoes?

10 [Mangoes in box] * Rs.10 [Cost of one Mango] = Rs.100 [Cost of complete box]

Here Rs. 100 [Cost of complete box] , we can related this with Market Cap.

Now we will try to understand Market cap with respect Stock Market reference.

If we have 10 outstanding shares of company X in the market for trading and current stock price is Rs.10

then,

Company "X" Market Cap = 10 Outstanding shares * Rs.10 [Price of one share] = Rs.100.

So, the Market Cap of Company X is Rs.100.

Basically, Market Cap = No of Outstanding shares * CMP of one share.

So, Market cap is the measurement of company size on a particular day w.r.t CMP with Outstanding shares.

Now example with different scenario’s,

If Company A having 1 Cr outstanding shares in stock market available for trading and CMP on day 1 is Rs.10 then the Market cap of company on day 1 is Rs.10 Cr.

But on second day if the CMP changes to Rs.20 then the Market cap of company on second day will be Rs.20 Cr.

Next on third day if the CMP changes to Rs.15 then the Market cap of company on third day will become Rs.15 Cr.

The market capitalization of the firm may fluctuate or change as a result of pricing variations.

Depending on the variations in market capitalization, organizations can be categorized as

1. Large Cap

2. Mid Cap

3. Small Cap

Now a days further more classifications came into pictures like, if company having very large market cap, then it is classified as Giants and very small market cap then is it classified as micro-cap company.

Furthermore, please understand that companies in large cap have large qty of outstanding shares and have large market cap and some company have less no’s of outstanding shares also can come under large cap category.

For example,

Company B have 1000 Cr outstanding shares and CMP is Rs.1000, then the Market cap is 10,00,000 Cr.

Company C have 10 Cr outstanding shares and CMP is Rs.1,00,000, then again, the Market cap is 10,00,000 Cr.

Both companies have the same market cap but Company B have more outstanding shares and Company C have high CMP per share.

It is therefore quite possible that the Market Cap category might shift to one with a large quantity of outstanding shares at a fair price or one with a high CMP per share and a small quantity of outstanding shares.

Market capitalization provides an overview of a company's financial health.

Compared to mid and small cap companies, large cap companies are more stable and less impacted by the ups and downs of the market.

As contrast to mid and small size organizations, they also have a sizable reserve cash for company development if opportunities come as well as for managing operations through difficult times.

So, Friends Market Capitalization is an easy for us to understand yet crucial characteristic that should be taken into account when choosing any company for our investing purposes.

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Disclaimer: This post is not considered a recommendation to buy, sell, or invest in any company; it is just intended for educational purposes. Do your research and due diligence before making any investment, and talk to your financial advisor.

SIP Benefit [Good Friendships Key to Success]

2023-09-10T20:13:00.003+05:30

The fundamental SIP functioning premise was covered in our previous post.

We're going to talk about how SIP could be beneficial for us right now.

However, before discussing SIP, let's first define the term "mutual fund."

What is Mutual Fund?

Individual investors often purchase individual equities after conducting research and analysis. However, majority of individual investors struggle with stock selection, and retail investors in particular struggle with stock analysis and selection. They also lack the time to do in-depth company research.

For the benefit of individual investors, certain highly qualified stock analysts and fund managers perform this incredibly difficult jobs.

After a thorough review of each stock, they create groups of stocks. They then obtain funding from the individual investors and purchase those equities on their behalf.

Therefore, there is mutual understanding between the fund manager, who is knowledgeable about the stocks available for investment, and the individual investor, who has funds to invest.

We shall talk about mutual funds in more detail later on.

We shall now turn to our current topic of discussion, the benefits of SIP.

We'll attempt to comprehend it through an illustration.

First, We shall analyses the movement of mutual fund A

if mutual fund A's NAV continuous in uptrend, from Rs. 8 to Rs. 15.5 in two years.

The average NAV cost is then Rs. 11.32 [this is in-between Rs. 8 (Low) to Rs. 15.5 (High)], and using the current NAV of Rs. 15.5 we have made a profit of Rs. 8847.95, or a return of roughly 36.87%.

Furthermore, if the NAV increases to Rs 16 in the future, the profit would be Rs 9907.57, or 41.28%. Mutual Fund A details shown in below figure 1.

Fig 1. Mutual Fund "A" NAV keep on Uptrend

Second, We shall analyses the movement of mutual fund B

if mutual fund B's NAV keep on sideways, in between Rs. 8 to Rs. 15 in two years.

The average NAV cost is then Rs. 10.79 [this is in-between Rs. 8 (Low) to Rs. 15 (High)], and using the current NAV of Rs. 12 we have made a profit of Rs. 2695.50, or a return of roughly 11.23%.

Furthermore, if the NAV increases to Rs 16 in the future, the profit would be Rs 11594, or 48.31%. Mutual Fund B details shown in below figure 2.

Fig 2. Mutual Fund "B" NAV keep on Sideways

At last Third, We shall analyses the movement of mutual fund C

if mutual fund C's NAV keep on Downtrend, in between Rs. 12 to Rs. 8 in two years.

The average NAV cost is then Rs. 10.08 [this is in-between Rs. 12 (High) to Rs. 8 (Low)], and using the current NAV of Rs. 8 we have made a Loss of Rs. 4947.73, or the negative return of roughly -20.63%.

Furthermore, if the NAV increases to Rs 16 in the future, the profit would be Rs 14104.53, or 58.77%. Mutual Fund C details shown in below figure 3.

Fig 3. Mutual Fund "C" NAV keep on Downtrend

We thus do not know which of the three conditions listed above we will experience when we begin investing in mutual funds.

That’s why we need to have stretched investment time frame to cover all types of cycles of uptrend, sideways & downtrend.

If we kept investing even after our investments went through one or two up-and-down cycles, then eventual return would undoubtedly exceed the amount initially invested.

The greatest magic or beauty, ultimately, is that for earning this return, we need not to do anything special except to do investment only.

The fund manager and his team will pick the stocks, research the stocks, buy and sell the stocks, and monitor the stocks.

We just have to keep our patience and keep on investment going on at the up and down times.

Hope you understand and enjoyed the mutual fund up-down journey and the possible return after that up down cycle.

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SIP = [Experience + Discipline]

2023-09-09T12:37:00.000+05:30

SIP is a name that everyone is now quite in touch with. However, a sizable portion of our society is still ignorant of this well-known idea and how it works. So, today, we'll try to figure out this idea.

SIP 👉 Systematic Investment Plan.

What does "systematic investment plan" mean to you?

It is just a disciplined or well-planned approach of investing, as the name would imply.

But even with the preceding explanation, I don't think it is quite easily understood.

With the example below, we will attempt to decode it:

We'll use a very basic, everyday example next.

Let's imagine that we spent each month's some amount to buy 1 kilogram of rice through out the year. The average price of rice will therefore fall in-between the high and low prices, as seen by the graph below:

Avg. Rice Price = [10+8+12+14+11+15+14+11+8+10+9+12] / 12 = 11.2

The average price Rs. 11.2 fall in-between Rs.15 [High] and Rs.8 [Low].

Now, if the price of the rice you bought at the average price of Rs. 11.2 rose to Rs. 15, and you sold all of the rice you bought at the new price Rs.15, you would make a profit of Rs. 46.5.

Profit = [Rs.15 - Rs.11.2] * 12 = Rs. 46.5

Now, we try to understand working funda of SIP.

The same idea now applies to the equity market, and if we continue to purchase mutual funds each month, then our average purchase price will fall in-between our high and low mutual fund price (NAV).

If we had a SIP of Rs 1000 per month for two years, we would have invested Rs 24000 and received 2224.6 units at an average cost of Rs 10.79.

After that, we will be able to sell this accumulated mutual fund at a greater price [NAV] in the future.

After two years, the SIP will yield Rs. 31144.76, nearly a profit of Rs. 7144.75, when sold at current NAV Rs.14 [i.e NAV after 2 years].

We may continue to invest as well. Therefore, if the NAV rises in the future, we might profit more from the same investment.

SIP combined with mutual funds has a twofold impact. SIP stands for systematic investment plan [Discipline], and a mutual fund is a collection of equities that is overseen on our behalf by knowledgeable fund managers [Experience].

So, experience and discipline complement one another.

The next article will go into further detail and attempt to shed light on SIP, how to work out for SIP, and the advantages of goal based SIP.

Power of Stock Valuation Study

2023-09-03T19:55:00.019+05:30

Friends, we have a wonderful and significant topic to cover today regarding stock valuation.

Why is stock valuation necessary?

Why should every investor learn how to value stocks?

Does it actually assist us in making financial decisions?

I really hope you find the answers to all of your questions....

Friends Let's Go...

Suppose we are driving a car at 100 km/hr over a distance of 1000 km without stopping. If we run at a constant speed of 100 km/hr, we can complete the distance in 10 hours. Because we are aware that the speed is constant, we can determine this time.

However, in the same scenario as earlier when we are travelling 1000 miles, this time our pace is unpredictable and we are stopping sometimes. Because of this, we are unable to determine if it will take 15 or 20 hours to get at our destination.

The aforementioned example makes it very evident that we can forecast the time it will take to get at our destination if we know the constancy of our speed.

We will now attempt to apply this circumstance to the stock market. If we are aware of the consistency of our stock's growth and the pace at which it is expanding, we can forecast the future growth rate and therefore the relative price movement of succeeding stocks with ease.

In earlier articles, we learned how to do stock valuation and determine their entry and target prices [with steady growth rates]. Importance of Stock Valuation

We will now examine the accuracy of the stock valuation analysis.

In order to comprehend the "Power of Stock Valuation" better, we have one case study.

We looked at Infosys' price changes from FY19–20 to FY23–24.

Using the stock valuation approach, we forecast the entry and target prices for each of the following years: FY19–20, FY20–21, FY21–22, FY22–23, and FY23–24 and tracked those prices.

Additionally, we have recorded Infosys' actual 52-week high and 52-week low price movement for the relevant years.

In above graph the

Dark Green Colour Indicate – 52 Week High Price
Light Green Colour Indicate – Target Price
Blue Colour Indicate – Entry Price
Red Colour Indicate – 52 Week Low Price

Basically, we have determined the Target and Entry prices of the stock for each year using the stock valuation approach [methods 1 to method 6, As shown in table 1]. then kept track of it throughout the year to obtain the stock's 52-week high and low values. As you can see, the 52-week high is always higher than our calculated Target Price and the 52-week low is always lower than our derived Entry Price.

This process makes it extremely evident that we can calculate the target and entry prices for stocks each year. After that, if the stock is trading below the entry price, we will purchase it, and if it is trading above the target price, we will sell it.

Now there is no longer a need to constantly monitor stock price changes. To purchase or sell the stock, we only need to calculate the target and entry price once a year and keep track of it.

Disclaimer: This post is not considered a recommendation to buy, sell, or invest in any company; it is just intended for educational purposes. The stock name is used just as an example and for study purposes in this article. Do your research and due diligence before making an investment, and talk to your financial advisor.

Understanding Reserve And Surplus Fund

2022-04-01T00:14:00.000+05:30

RESERVE AND SURPLUS

Reserve & Surplus Fund

INTRODUCTION:

As the name implies, "Reserve" refers to something stored aside for future use, whereas "Surplus" refers to an abundance of items.

For example, if after all payments, we are left with Rs. 1000 in the current month and we already have Rs. 5000 in previous months' money in our account, and we intend to spend Rs. 500 from the current month's available fund of Rs.1000 for some reason.

So, from the current month's fund of Rs.1000, Rs. 500 is set aside for usage, and the remaining Rs. 500 goes to our surplus fund (i.e., 5000 + 500 = 5500). The new Surplus fund now stands at Rs. 5500.

This is a very basic example to demonstrate the concepts of Reserve and Surplus.

UNDERSTAND RESERVE AND SURPLUS IN FINANCIAL TERMS:

At the top of the balance sheet table, the phrases Reserve and Surplus appear.

The amount of Reserve and Surplus on the balance sheet reflects or provides a clear picture of a company's financial stability and strength. What is the company's financial situation like, and is it improving or not?

What is a Reserve Fund?

Reserve Fund

A reserve fund is a highly liquid asset set aside by a corporation to meet unanticipated as well as well-planned future expenditures or financial obligations. Reserves always have a credit balance (positive amount) and might refer to a portion of the shareholders' equity.

If a firm wants to acquire new machinery to ramp up production, replace outdated machines, upgrade technology, or build up a new production facility, the company's management must plan and set aside money from its revenues to carry out these goals.

What is a Surplus Fund?

Surplus Fund

A surplus fund is a money that remains accessible to the firm after all obligations have been met. If the corporation meets all standards and has additional cash available, the surplus fund grows year after year. This capital can also be utilized in the future for corporate development and upgrades, as well as for surviving in difficult economic times.

If, after making all payments and separating the reserve fund for usage according to the plan, there is still money left over, it is added to the surplus fund account. Every year, financially sound and stable organizations increase their surplus account fund by carefully managing inflowing and outflowing cash in the most effective and efficient manner.

CONCLUSION :

The value of the Reserve and Surplus Fund is now evident to all our readers. What is the goal of the Reserve and Surplus Fund buildup and how is it done? How it aids in the completion of specified tasks and the financial stability of the organization.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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Emergency Fund

2021-11-15T00:10:00.013+05:30

Emergency Fund

The word "emergency" has a variety of negative connotations, such as a serious, unexpected, and often deadly situation that necessitates quick action.

Similar way the importance of the emergency fund in financial planning is equally critical.

Now you'll ask yourself a question. What is an emergency fund and how does it work?

5 Level Financial Planning Pyramid

What is an emergency fund?

The emergency fund is the fourth level of the financial planning pyramid, as shown in the diagram above. It protects our financial planning against the unknown that enters our lives without warning. The goal of an emergency fund is to provide financial stability by providing a safety net that may be utilized to cover unexpected expenses like medical emergency or job loss for short duration of time and available easily in short time.

How much emergency fund is sufficient?

In general, the emergency fund amount should have to be sufficient enough to cover all of our basic needs for the following six months if we experience a misfortune such as a job loss or a medical issue and are unable to work.

If our monthly demand is $30,000, we should keep at least $30,000 * 6 months = $1,50,000, in liquid form in our account, which is conveniently available in the event of an emergency.

Or as an alternatively, you can keep at least 20% ($30,000) of your liquid emergency fund on hand at all times in your house.

How does one go about creating emergency fund?

We must concentrate on the accumulation of emergency fund first after finishing financial planning pyramid levels 2 and 3.

For example,

If your monthly salary is $50,000, any money left over after paying your monthly expenses, health insurance premiums, and term insurance premiums should be used to build up your emergency fund first.

Conclusion

Emergency fund is very important element of your financial pyramid. Before going for starting your investment journey, you should first accumulate sufficient required emergency fund. So that in case of any mishap, you can balance you financial responsibilities without getting disturb yourself and your financial plans.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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EBITDA - Earning Before + Interest + Tax + Depreciation + Amortization

2021-07-24T23:22:00.002+05:30

EBITDA - Earning Before + Interest + Taxes + Depreciation + Amortization

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EBITDA

If you are working in stock market then several times you have heard about the term EBITDA wherever there is Quarterly results or Annually results announced by company.

Full form of EBITDA - Earning Before + Interest + Taxes + Depreciation + Amortization. The full form its explains what is included in EBITDA. It is the profit of company before paying portion of Interest, Taxes, Depreciation and Amortization. EBITDA details founds in the Profit & Loss statement.

Earning - Amount generated by sales.

Interest - Amount paid in the form of monetary charge for loans taken.

Tax - Amount paid in the form of taxes levied by government.

Depreciation - Amount paid for the expensing of a fixed tangible assets over it useful life. Ex - Equipment, Vehicle, Land, Machinery & Building etc.

Amortization - Amount paid for the intangible assets over the asset's useful life. Ex - Patents, Trademarks, Franchise agreements, Proprietary processes (Copyrights) etc.

How to Calculate EBITDA?

EBITDA = Net Income + Interest + Tax + Depreciation + Amortization

EBITDA

Conclusion:

It's time to wrap up. So, EBITDA is now easily understandable to you as it is the profit of company before paying of Interest, Taxes, Depreciation and Amortization.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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For Shopping & Deals You Can Visit : https://bestchoice4every1.blogspot.com

CAGR % - Compound Annual Growth Rate

2021-07-23T23:07:00.000+05:30

CAGR% - Compound Annual Growth Rate

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ABSOLUTE RETURN Vs CAGR

The main moto of our investment is to get maximum return. And everyone excited to get more and more return on their investments. But people are totally confused or unware, how to measure their investment returns. Whether to calculate return in absolute return or CAGR.

So, lets go and learn CAGR,

What is CAGR (Compound Annual Growth Rate)?

The compound annual growth rate (CAGR) is a average annual growth measurement of your investments over a fixed time period. It give you clear picture of the average rate of return on your assets over the course of a year.

And it is measure in terms of % i.e CAGR%.

How CAGR is calculated (mathematical formula)?

CAGR = {(Final Amount / Initial Amount)^(1/n)}-1

n = no of years,

For example:

* Initial amount invested - $10000

* Final amount generate in 5 years - $16000

* n = 5 years

then,

CAGR = {(16000/10000)^(1/5)}-1

CAGR = 9.86 %.

So, how the Absolute Return and CAGR are different?

Let's again use same above example

* Initial amount invested - $10000

* Final amount generate in 5 years - $16000

* n = 5 years

Absolute return

= (Final amount - Initial amount)/ Initial amount * 100

= (16000-10000)/10000 * 100

= (6000/10000) * 100

= 60%.

Here in Absolute return there is no relation shown with the investment years, only initial amount ($10000) and final amount ($16000) taken into consideration for calculation of return.

Whereas in CAGR average out return is calculated, as in our above example of CARG return in 5 years is 9.86% means every year return is calculated with 9.86%,

1st year return is 9.86%

2nd year return is 9.86%

3rd year return is 9.86%

4th year return is 9.86%

5th year return is 9.86%

Return is similar in all years.

5 YEARS ABSOLUTE RETURN & CAGR

ABSOLUTE RETURN VS CAGR

Important point to remember,

Care to be taken to calculate the CAGR with proper duration:

For example,

Initial investment (0 Year ) - $10000

1st year - $9000

2nd year - $8000

3rd year - $9500

4th year - $11000

5th year - $13000

So,

initial 3 years CAGR = (-1.7)%

3 years CAGR

= {(9500/10000)^(1/3)}-1

= (-1.7)%

last 3 years CARG = 17.57%

3 years CAGR

= {(13000/8000)^(1/3)}-1

= 17.57%

5 years CAGR = 5.39%

= {(13000/10000)^(1/5)}-1

= 5.39%

Conclusion

It's time to wrap up. Basically in financial matter investment return calculation should be systematic addressed. Absolute return doesn't give clear picture of investment return with respect to duration (no of years of investment), which is very important fact. Whereas the calculation of investment return with CAGR consider the period of investment for calculating investment return.

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Best Informative Magazines For Stock Market

2021-07-21T19:32:00.000+05:30

Best Informative Magazines For Stock Market

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BEST INFORMATIVE MAGAZINES FOR STOCK MARKET

A Magazine is a piece of literature that is read by public, but these aren't the same as ordinary books. A Magazine's purpose is to teach, inspire and delight it's reader. These comes in weekly, fortnightly or monthly durations. Magazine comes in vast variety of subjects. Here in this article, we are highlighting on the magazine related the stock market.

This stock market magazines contain enormous information related to various stocks. This information related to stocks help us to increase our knowledge, clarity on stocks health, our decisive power and our faith for our long term investments.

This magazines update us day by day condition of our invested stock, what is the situation going on in the business of our invested stock. How it is going to perform in future based on their present working strategies and past performance.

In-all these stock market magazine shows us path, open our eyes and mind to think, compare, decide among thousand of stocks for investment and earning.

So, take a glance on the given below few famous and favorite stock market magazines and enjoy it.

DALAL STREET INVESTMENT JOURNALS

Website - https://www.dsij.in/

Image Source: DSIJ Site

VALUE RESEARCH

Website - https://shop.valueresearchonline.com/

Image Source: Value Research Site

CAPITAL MARKET

Website- https://www.capitalmarket.com/

Image Source: Capital Market Site

Hope this will help you to improve your knowledge and information.

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Important Books Related to Warren Buffett

2021-07-19T20:12:00.007+05:30

Important Books Related to Warren Buffett

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IMPORTANT BOOKS RELATED TO WARREN BUFFETT

Few inspiring points related to Mr. Warren Buffett,

1.When Warren Buffett was 11 years old, he purchased his first stock.

2.By the time Warren Buffett was 16 years, he had accumulated $53,000 in earnings.

3.Since 1958, Warren Buffett has resided in the same residence.

4.After turning 60, then Warren Buffett earned over 94 percent of his assets.

5.Warren Buffett likes to reads for 80% of his day time.

There are many more important and inspiring facts which is not possible include all here in this article. But, if you want you can learn from different books written on or related to Warren Buffett. It is great opportunity for us to know and learn about a great stock market legend.

Few important book related to Stock Market Legend Mr. Warren Buffett are given below :-

1.THE WARREN BUFFETT WAY - To Buy This Book Now Click Here

2.WARREN BUFFETT AND THE INTERPRETATION OF FINANCIAL STATEMENTS - To Buy This Book Now Click Here

3.THE WARREN BUFFETT STOCK PORTFOLIO - (WARREN BUFFETT STOCK PICKS: WHY AND WHEN HE IS INVESTING IN THEM) - To Buy This Book Now Click Here

4.7 SECRETS TO INVESTING LIKE WARREN BUFFETT - To Buy This Book Now Click Here

5.INTO THE MINDS OF WARREN BUFFETT AND CHARLIE MUNGER - To Buy This Book Now Click Here

For more books - Click Here

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Mr. Market Our Friend

2021-07-14T22:23:00.003+05:30

Mr. Market Our Friend

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Mr. MARKET OUR FRIEND

Many stock market legends have mentioned you several times that 'Stock Market is Always Right'. If market is upward or if market is downward.

There are several driving factors which moves the market up or down like sentiments, news, earnings, greed & fear, political and geo-political tensions etc. But the direction in which market moves is always right. We need to adjust our views according to the market movement direction to get profitable trades. So, how to judge this market direction.

For understanding the market movement direction Sir Benjamin Graham have introduced a concept of imaginary investor Mr. Market in his book 'The Intelligent Investor' in 1949.

Mr. Market Introduction:

Mr. Market is a fictional investor who is greatly affected by panic, excitement, and disinterest on any particular day, and who made investment decisions based on his mood rather than fundamental or technical analysis. Mr. Market is indeed thought to be bipolar, shifting from periods of optimism to moods of pessimism at random.

Working of Mr. Market:

Mr. Market is always eager to buy or sell a share based on how it has recent times increased or decreased in value. However, these decisions are based on emotion rather than good investing ideas as a result of previous developments.

Although Mr. Market is so emotional and moody, it provides opportunities for smart investors to enter and exit in market at advantageous situations.

When Mr. Market becomes overly negative, good stock values will be advantageous to buy, allowing investors to buy them at a decent price compared to their future potential. Means when Mr. Market become pessimistic about market conditions, then it will offer $100 price share at the price of $60 or $70 at lower rates then shares actual price.

When Mr. Market is overconfident, it may better opportunity to sell the shares at an unjustified higher price. Means when Mr. Market become optimistic about market conditions, then it will offer $100 price share at a price of $120 or $130 at higher rates then shares actual price.

But as per Sir Benjamin Graham, in addition to Mr. Market mood, we should always first evaluate stock value through its fundamental analysis and then look after company's future prospects to decide for a purchase or sale of the shares.

And try to grab these opportunities and conditions created by Mr. Market. We should buy when Mr. Market have a negative market outlook as shares will be available at cheaper price to us to buy and sell our shares when Mr. Market have a positive market outlook as we can sell our shares at higher prices to get more profit.

Conclusion

It's time to wrap up. So, we should do friendship with Mr. Market and take his help to decide our buy or sell views on shares. Mr. Market have negative market outlook we should get ready to buy shares and when Mr. Market have positive market outlook we should get ready to sell our shares.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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Margin of Safety

2021-07-13T21:25:00.006+05:30

Margin of Safety

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MARGIN OF SAFETY

The word 'Margin of Safety' itself having a huge weight. But most of the new comers or market beginners as well as many of old market participants are unaware of this powerful term.

The concept of 'Margin of Safety' was first introduced by the Sir Benjamin Graham (We know them as the Father of Value Investing) & He is the mentor of Mr. Warren Buffet.

Sir Benjamin Graham explained the concept of 'Margin of Safety' for normal public by example of weight carrying capacity of bridge. Suppose we have pass a truck of 1000 tons over a bridge then, we have to build a bridge with a carrying capacity of 1200 tons. This excess 200 tons is the 'Margin of Safety' for bridge to pass over the truck with a weight of 1000 tons.

Ok we will see the 'Margin of Safety' in technical term later on which is used in stock market, but in our day to day real life also we use this concept in many ways like 1. Reserve petrol concept in petrol tank in our vehicle is the extra 'Margin of Safety' to fill up petrol before it completely finished anywhere in unknown place. 2. The use of credit card is also one type of concept of 'Margin of Safety', whenever our cash is over still, we can pay money in case of emergency. In this way there are many more example in our life which we can relate with 'Margin of Safety'. So, intelligent calculated people use this concept very well in both personal and professional life.

So, lets talk about the concept of 'Margin of Safety' in technical way.

What is the concept of Margin of Safety?

Margin of safety is an investing idea that states that an investor should only buy shares if their market price is much lower than their true worth. In other words, the margin of safety is the gap between the market price of a stock (stock market price should have to be less than actual value) and your estimate of its actual value. Because investors can define a margin of safety based on their risk choices, buying shares when this gap exists allows for a low-risk investment.

By purchasing equities at a discount to their target price, a 'Margin of Safety' is built in case estimates are wrong or inaccurate.

Example of Investing with 'Margin of Safety'

If we estimates that our stock ABC has an intrinsic value of $150, and CMP of our stock ABC is $180. So our estimated intrinsic value is well below its current share price of $180.

Now we will apply a 20% discounting on our estimated intrinsic value of $150 then our purchase price will be $120.

In this case, we believe stock ABC is presently valued at $180 is ok, but we might not buy it for more than our estimated intrinsic value of $150.

For more safety we sets our buy price at $120 with a discounting of 20% on our estimate intrinsic value in order to completely eliminate our downside risk.

According to the model of 'Margin of Safety', we may not be able to purchase stock ABC in the coming years. But we may buy it with confidence, if the stock price come down to $120 for any reasons other than a downturn in stock ABC's earning outlook.

Conclusion

Its time to wrap up. So, 'Margin of Safety' is very strong concept beneficial for the long term investor. Who wants to buy a share on rare occasion when shares are available at their discounted rates.

To become a successful investor in stock market, we need to learn and imply practically this concept of 'Margin of Safety'.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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themarketwarrior journey

2021-07-12T20:58:00.003+05:30

themarketwarrior journey

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themarketwarrior journey

Friends today our 50 posts completed in our website www.themarketwarrior.co.in , journey started with 1 and now it is 50 posts. This is all possible because of your faith and support to themarketwarrior. Thank you very much! And keep connected.

Best Websites For Stock Market

2021-07-10T19:35:00.004+05:30

Best Websites For Stock Market

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Best Websites For Stock Market Learning

Internet have totally revolutionized our life. Really really we must thanks to internet. Whatever information we need at any point of time we get. Wherever information we need at any point of time we get. From the start of day till to end of the day, we use internet continuously for getting different new ideas and different required information's. So, internet is now almost part of our life. It help us in our learning and also in our earning.

Now stock trading is no longer the exclusive zone of investing professionals, thanks to the internet. Anyone with access to a computer or mobile device can now make money by trading in stocks. A growing number of people are turning to stock trading as a method to supplement to their income, and those who are most serious about learning the necessary skills can make a lot of money.

And for learning this necessary skills of stock market, there are few most popular and best websites for stock market.

1. www.moneycontrol.com

2. www.nseindia.com

3. www.bseindia.com

4. www.investing.com

5. www.screener.in

6. chartink.com

7. economictimes.indiatimes.com

8. www.valueresearchonline.com

So, this is not at all end of websites. There are many more website which are very very useful for the stock market beginners as well as the stock market professional players. We should always be in touch of this websites keep on exploring. They give us huge priceless valuable information's and most important the knowledge.

By reading these websites our thought process and mindset changes. We become more and more focused, informative, analytical and informed decision maker. These all websites gives us lot of latest information What is happening here and there in national and international platforms? How it will impact or effect the stock market? Various companies past data and present conditions. So, information is endless and narrating all of them in one article is almost impossible. So, all of you try and exploring all the above wonderful stock market websites. Each websites are better and best than previous ones.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything or any website to anyone.

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"Buy Right, Hold Tight" - A Need Of Hour

2021-07-08T23:18:00.032+05:30

"Buy Right, Hold Tight" - A Need Of Hour

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Buy Right Hold Tight

Everyone working in Stock Market are aware of about the nature of Stock Market, i.e. up & down, up & down. This up & down nature is the beauty of stock market. But no one can forecast or aware of, when stock will be up or when it will be down.

Market volatility is not liked by retail investors, they lack patience to stay engaged when markets perform wildly or when sharp corrections occurs.

Several times in the past, the stock market has dropped and investors have lost more than 50% in a single year, eroding most investors' wealth as they hurried to exit in panic and registered significant losses. The very next following year, the market made a strong comeback.

This is typical a market cycle, with a few really excellent years followed by a terrible year and maybe a particularly bad year. When an investor gets caught up in the cyclone of volatility and exits his or her holdings at the wrong time, he or she not only incurs significant losses, but also misses out on the opportunity to profit extravagantly when the economy recovers.

So, the guru mantra to survive in the unpredictable stock market is "Buy Right, Hold Tight".

Buy Right

What exactly do we mean when we say Buy Right?

Buy Right means buy stock at right time, right value, right quality, right quantity. Fundamentally strong company, with cutting edge in business and good earning growth potential but at their bad times with undervalued price.

When the markets are in the state of correction, there are opportunities to by high-quality stocks at discounted prices. Investors should take advantage of these opportunities to build a long-term portfolio or purchase high-quality stocks at a fair price. This is the right time to buy.

Hold Tight

What exactly do we mean when we say Hold Tight?

Stock market have a nature of up & downs cycle. So, we must try to accumulate as much as stock in market correction and keep it in holding for long and keep on accumulating and hold it.

It's important to keep in mind that while investing in the stock market, investors must bear some risk, and that significant portfolio value can only be derived over time. Short-term volatility or market corrections are unavoidable during the investment life cycle, the secret of success is to invest in high-quality stocks and overlook the distractions.

Eyes Opening Fact :

For the previous 25 years, the opportunity was a really a very localized opportunity. As a matter of fact, India GDP grew from $100-$150 billion in 1988 to more than $2 trillion today. The Indian economy will grow from $2 trillion to $5-$10 trillion in the next 25 years. In the next 20-25 years, India might be one of world's top three or four economies, and that thinking process is communicated all around the world.

So, the above fact is self explanatory and really really an eye opening fact and giving us a chance of participation in a very big opportunity to increase our invest to many folds by "Buying and Holding".

Conclusion

It's time to wrap up. "Buy Right, Hold Tight" needs digging deep properly with proper stock analysis to buy stock at right time and right price. And then holding stock for long time in markets ups and downs to get complete successful return on investment. One should not try to jump from one train to another train and then to next another train to reach our defined destination fast. It may result in delay in reaching in our destination.

But at the same time investing well and sitting tight does not imply that investor ignore their holdings. We need to evaluate our portfolio periodically.

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How Does Investing In Stocks Help You To Build Your Wealth?

2021-07-04T19:06:00.020+05:30

How Stock Investing Generate Wealth?

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Stock Investment For Wealth Generation

Stock Market the name itself having huge weightage. But it is a very risky game and you are not alone if you are afraid of investing in the stock market. Individuals with little or no expertise in stock investing are either horrified by horror stories about the typical investor losing 50% of their portfolio worth, or they are frustrated by the fact that the average investor loses 50% of their portfolio value every year.

The truth is that investing in the stock market is risky game, but when done correctly in disciplined way, it may be one of the most efficient methods to increase one's net-worth. While the value of one's property often accounts for the majority of an individual's net worth, most successful and very wealthy people invest the majority of their capital in stocks. Stock Market needs a deep dedication, discipline & passion.

Dedication - Committed to task

Discipline - Follow proper path

Passion - Strong emotion

Although every thing above is ok, but the important question is

How stock investing generates wealth?

We will try to understand the process of wealth generation by investing in stocks with the help of a simple example. Several studies have demonstrated that equities outperform all other asset classes in terms of investment returns over longer timeframes. We will consider a period of around 10 years for our study purpose.

Capital gains and dividends + Splits + Bonus are the sources of stock returns. When you sell a stock for a higher price than when you bought it, you have a capital gain. A dividend is a portion of a company's profit that is distributed to its investors.

Suppose we have bought 1 shares at the rate $10 that means we have invested $10 in share market initially.

So, first we will see the capital appreciation, if the stock appreciated with 25% CAGR.

Fig -1

Fig - 1: In 10 Yrs price of 1 share increase from $10 to $93 give CAGR of 25% without Dividend gain consideration.

Fig - 2

Fig - 2: In 10 Yrs price of 1 share increase from $10 to $113.8 give CAGR of 28% including Dividend gain consideration.

Fig - 3

But if we patiently wait and selected a good stock by doing proper stock valuation that give dividends, splits and bonus then in a period of 10 Yrs 1 share get converted into 80 shares and the amount accumulated is increase from $10 to $418.7 give CAGR of 45% including Dividend gain + Splits + Bonus.

So, Suppose you have bought 100 shares i.e. invested $1000 10 Yrs ago then after 10 Yrs it will become $41800 including price appreciation + dividend + split + bonus (45% CAGR return).

To Learn More About

Stock Splits - Click Here

Bonus Shares - Click Here

Now the concept is very much clear to every body.

Conclusion

It's time to wrap up. Kindly note that above all calculation is imaginary and used to clear the concept of benefit of investing in stock and how our investment amount appreciates, if we select proper stock with stock valuation concept and keep hold it for long period.

So, in this way investing in stocks help you to build your wealth.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything to anyone.

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Stock Splits

2021-07-01T22:39:00.010+05:30

Stock Split

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Learn About Stock Split

We have heard and seen about several stocks with price in 5 digits.

What do you think, isn't it possible for every stock market participants to buy such huge price stocks?

So, what do you think now what stock market participants should do? Shall they should buy this stocks or leave it.

But if this stock is in 5 digits means this stock having solid fundamentals and growth trajectory.

Now the situation in not balance, stock is good but not affordable for all. Several times such situation comes in stock market in many stocks.

This situation can be balanced and can be overcome by different techniques and one of this technique is stock split.

Suppose your friend having $10000 and he want to buy a share of price $10000, then he can buy 1 share of it. And now you are having $2000 in your pocket but you also want to buy same share of price $10000, then isn't it possible.

But now company had decided to split their shares into 10 for 1, that means now the share price is $1000/each. Means now your friend can buy 10 shares in $10000 with new share price $1000 and you can also buy 2 shares with your $2000.

What is Stock Split?

Split means breaking, when a firm declares a stock split, the number of shares issued increases, but the market capitalization remains unchanged. Existing shares get splits, but the underlying value is unchanged. The price per share falls as the number of shares grows.

There are various ratios in which company board splits their shares e.g.

2 for 1

3 for 1

5 for 1

10 for 1

3 for 2 like that,

Split Ratio's

Why company do stock splits?

A stock split is considered by corporations for variety of reasons. The first explanation has to do with psychology. As the price of a stock rises, some investors may believe it is too expensive to purchase, while small investors my believe it is unaffordable. Splitting the stock lowers the price of the stock to a more appealing level. While the stock's true value remains unchanged, the decreased stock price may have an impact on how the stock is viewed, perhaps attracting new investors. Existing shareholder will also feel as though they have more shares than they had before the stock was split, and they will have more stock to trade if the price rises.

Any advantage of stock split to investor?

There are many debates on whether stock splits benefit or harm investors. A stock split, according to one side, is a good buying indicator, indicating that the company's share price is rising and performing well. While this is true, a stock split has no influence on the stocks underlying value and provides no actual benefit to investors. Despite this, investing newsletters usually pay attention to the generally favorable sentiment surrounding a stock split. There are entire magazines dedicated to following split equities and attempting to profit from the positive nature of splits. Critics argue that this technique isn't tried and true, and is only marginally successful.

Conclusion

It's time to wrap-up, the major motive for purchasing a company's stock should not be due to a stock split. While there are some psychological motivations for corporations splitting their stock, none of the business fundamentals are affected. Remember that the split has no impact on the company's market capitalization.

Disclaimer: This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything to anyone.

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How to Learn Stock Market (e-book)

2021-06-23T05:31:00.008+05:30

Guide For Stock Market Beginner's

This e-book is exclusively for the stock market beginner's only.

Why this e-book?

The beginner in the stock market have lots of dream in their eyes, that he we earn lot of money from stock market very fast and then live in peace for rest of life. But they are not aware of anything about stock market and then start their stock market journey in confusion. No one is there to guide them what is right and what is wrong. what to do and what not to do. In this process lot of time they get confused and start taking lot of wrong decision in stock market which lead to them in loss. Then try to cover up loss and make again huge loss. Few of them understand and leave the stock market. So, if starting is not right then this type of situation will definite occur.

So, this e-book is exclusively for the beginner's only who don't no the if's and but's of the stock market.

CLICK HERE BUY NOW

JUST Rs. 199

What Topic's this e-book will cover?

This e-book exclusively will cover below given topic's:

Challenges for stock market beginner's?

Scope in stock market?

What is stock?

What is stock market?

What is stock trading?

Which stock is eligible for stock market participation?

What are the requirements for joining stock market?

What is demat account and trading account?

What are types of market / segment in stock market?

What are sectors in stock market?

What is fundamental and technical analysis?

What are trading strategies?

How to invest in stock market/

Stock friend or enemy understand it properly.

How to get ready for day trading?

How to do long term investment?

How to balance risk and reward?

Case study

Conclusion :

From the above topic coverage list now all of you are quiet clear about the vast coverage of all topic required by the stock market beginners.

So, Friend go and read this exclusive e-book "GUIDE FOR STOCK MARKET BEGINNER'S".

Demat Account Meaning

2021-06-18T14:10:00.091+05:30

Demat Account Meaning

LEARN ABOUT DEMAT ACCOUNT

Introduction

A demat account is a type of account that is used to keep electronic copies of shares and securities. A Demat account is a dematerialized account in its entire form. The goal of opening a Demat account is to hold shares that have been purchased, making online share trading easier for users. Depositories in India, such as The National Stocks Depository Limited (NSDL), which deals with NSE securities, and the Central Depository Securities Limited (CSDL), which serves as a depository for the BSE, are the depositories for demat accounts in India. , offer free Demat accounts. Intermediaries, depository participants, and stockbrokers provide these services, and they charge a appropriate fee for using their services.

What exactly is a Demat account and how does it function?

A Demat Account, also known as a Dematerialised Account, it is a secure electronic storage system for securities, allows you to hold shares and assets in an electronic format. Shares are purchased and held in a Demat Account while online trading, making it easier for customers to trade. It functions similarly to a savings account, allowing you to keep track of, buy, and sell assets on financial exchanges such as the BSE, NSE, and MCX. You can use a demat account to store, purchase, and sell stocks, bonds, mutual funds, initial public offerings (IPOs), commodities, derivatives, and exchange-traded funds (ETFs) electronically. When you purchase shares or securities, they are credited to your demat account, and whenever you sell them, they are deducted from your demat account.

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JUST Rs. 149

What is dematerialisation?

The process of changing physical share certificates into electronic form, which is much easier to maintain and available from anywhere in the globe, is known as dematerialisation. To trade online, an investor must first open a Demat account with a Depository Participant (DP). The goal of dematerialisation is to make it easier for investors to maintain and monitor their holdings by eliminating the need for them to hold physical share certificates.

Demat accounts come in a number of different forms.

1. Regular Demat Account - For investors based in India, a standard demat account.

2. Repatriable Demat Account - Non-resident Indians can have a repatriable demat account (NRIs). Funds can be sent internationally using this demat account, but it must be linked to an NRE bank account.

3. Non Repatriable Demat Account - The non-repatriable demat account is the third type of demat account. NRIs utilise it as well, although they are unable to move funds abroad using this demat account. An NRO bank account must be linked to this type of demat account.

Advantages of Demat Account

All of your securities, including shares, options, futures, commodities, mutual funds, debentures, ETFs, and bonds, are held in electronic format with a demat account. From a single window, you may buy, trade, and hold these securities as well as track your investment portfolio. A demat account provides various significant advantages that are critical for investment and trading success.

1. It's a secure and convenient approach to store securities.

2. It ensures that securities are transferred immediately.

3. There is no stamp duty on securities transfers.

4. Physical certificate risks such as faulty delivery, fake securities, delays, thefts, and so on are no longer a concern.

5. There is a significant reduction in the amount of paperwork involved in the transfer of securities, as well as a reduction in transaction costs.

What is the difference between a demat account and a trading account?

This is really a very confusion one question what is demat account and trading account, what is difference in between those two accounts.

A trading account is used to buy and sell stocks by deducting funds from your Demat account and selling them in the market. On the other hand, a Demat account allows investors to maintain their financial products in an electronic format only.

Conclusion

Its time to wrap up. There is no risk of misplacement, destruction, theft, or forgery with demat accounts because investors can hold shares in electronic form rather than physical form. It is now easier than ever to transfer shares, and it may be done in a matter of hours rather than months. Furthermore, the procedure of changing addresses has become more seamless and less time-consuming since with the advent of Demat accounts. Convenience is another aspect where Demat accounts continuously improving. It already removed time-consuming procedures like obtaining and pasting stock market stamps, as well as restrictions on selling shares in odd amounts. As a result, the technique is simple and straightforward. Also you can keep track of your demat account 24 x 7.

So, now demat account makes our process fast & convenient, safe & secure, cost effective and paperless.

Disclaimer : This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything to anyone.

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Quarterly Earnings Report

2021-06-08T12:27:00.000+05:30

Quarterly Earnings Report

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Introduction

"Result" word itself having very big meaning in it. It shows where we are early and where we are now.

So, Result can be define as the effect or outcome of our efforts and actions.

Result have different meaning if we add it with different prefixes, like education result, financial result, our workout result etc.

Here we will see about the financial results of companies in this article. Financial Result also known as the Earnings Report.

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What basically are Earnings Report?

An earnings report is a formal financial document released by a public company that details the firm's expenditure, earnings, and overall profit for a specific time period.

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Investors might use a company's earnings report to get a sense of how effectively it is run and whether it is operating well.

It's worth noting, though, that earnings announcements frequently paint a bright picture of the company's financial status. As a result, learning how to read and analyze an earnings report is critical in order to distinguish between the management team's marketing strategy and reality.

What information does a company provide in its earnings report?

A press release detailing the contents of audited and unaudited financial accounts is usually issued by companies. The press release usually consists of a few paragraphs of information, a statement from the company's leaders, and descriptions of some of the most important financial metrics for investors, such as revenue, net income, cash flow, earnings per share, and dividends.

Companies will also provide investors with a presentation deck that covers the period's financial highlights and successes. The deck, on the other hand, is created for investors and usually conveys a highly positive message.

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What kinds of Earnings Report are available?

Based on time frame Earnings Report are categories as below:-

1. Yearly or Annual, (mostly preferred)

2. Half Yearly, (not much preferred)

3. Quarterly, (mostly preferred)

4. Monthly. (not much preferred)

1. Yearly or Annual Earnings Report released by companies only once in a year.

2. Half Yearly Earnings Report released by companies twice in a year in a gap of six months.

3. Quarterly Earnings Report released by companies at the gap of three months.

4. Monthly Earnings Report not preferred by any company, but as name suggest it is monthly report.

Out of the above-mentioned Earnings Reports, Quarterly Earnings Reports are favored to see the company's functioning health at interval of every three months.

How are Quarterly Earnings Reports Defined in Terms of Time?

The majority of financial reporting and dividend payments are made quarterly.

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The fiscal quarter and the fiscal year are the two main accounting periods for businesses (FY). Most businesses have a fiscal year that extends from Apr. 1 to Mar. 31. The following are the traditional calendar quarters that make up the year in Indian stock Market:

April, May, and June (Q1)
July, August, and September (Q2)
October, November, and December (Q3)
January, February, and March (Q4)

Whereas the MNC companies generally follow Jan. 1 to Dec. 31 as fiscal year

January, February, and March (Q1)
April, May, and June (Q2)
July, August, and September (Q3)
October, November, and December (Q4)

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How do earnings reports affect investors?

For publicly traded companies and their investors, quarterly earnings reports are critical. Each press release has the potential to have a major impact on the company's stock price. A company's stock value may rise if it has a strong quarter. The value of the company's stock could collapse if the company experience a bad quarter.

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Forward-looking "guidance" for the following several quarters or through the end of the year is frequently included in quarterly earnings reports. Analysts and investors use these estimates to forecast performance over the following few quarters.

Conclusion

It's time wrap up. As a result, the Quarterly Earnings Report is the company's financial statement after a three-month interval. These reports depict the company's financial health from quarter to quarter. This aids investors in forming a clear picture of their investment choices and strategy in that company. To read and comprehend an earnings report, you do not need to be an equity analyst. Concentrate on stocks that are of interest to you, despite the fact that many publicly traded companies provide financial reports each quarter.

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Online Shopping EVERYONE'S SOLUTION IN ONE PLACE

2021-05-30T20:06:00.004+05:30

Introduction

The modern world moves at a breakneck speed and never sleeps. People who have money but not enough time. They desire domestic and international products of their choice, and they're willing to pay for them. Consumers can choose from a variety of similar products of different companies. Companies can also sell their products anywhere in the world because there are no geographical restrictions. E-commerce has made all of this possible. As a result, there are a growing number of large and small online purchasing businesses are working. This is a win-win situation for everyone involved: the company, the online business, and the consumers.

What is Online Shopping?

Online shopping is the act of purchasing goods and services from merchants all over the world using the Internet while sitting at your own computer at their own location.

What products are available for purchase through online shops?

We use products from the moment we get up until to we settle for the night. That is to say, whatever product we consume in a 24-hour period can be purchased from online stores that offer several varieties of the same product from several providers.

But some major categories are :

1. Fashion & Beauty

2. Clothing & Accessories

3. Educational Courses

4. Book & Music

5. Electronic

6. Software

7. Fitness

8. Home & Kitchen

and many more categories are there .....

What are the advantages of shopping online?

As we all know, online shopping provides access to a wide range of products 24 hours a day, seven days a week.

Similarly, there are numerous benefits to shopping online.

We will see in short -

1. Shopping is available 24 hours a day, 7 days i.e Day as well as in Night. Flexibility for us.

2. Many options to choose from a large number of brands. Find what you're looking for. Choice for us.

3. Discount, coupons and promotional codes. Profitable for us.

4. Price comparisons are simple and easier. Decision making easier for us.

5. Better value for money. Beneficial for us.

6. Home delivery is available. Convenience of us.

7. You can try on clothes in the privacy of your own home. Privacy for us.

8. No need to be have physical presence on shop. Hygienic for us.

9. Help us to Save our Time. Time conservation is most important for us.

10. Returning items and cancelling order is easier. Easy replaceable for us.

11. Information and reviews available. Informative for us.

12. There are no crowds and less stress. Relaxing for us.

13. You will be able to send gifts more effortlessly. Memorable for us.

14. It's easier to send things to far off locations. Anywhere approachable for us.

15. You will receive an electronic record of your purchase receipt, which will make record-keeping much easier. Authentic for us.

In a nutshell, everything in internet purchasing is for us and in our favours: choice, bargaining, decision-making, our safety, time flexibility, and information.

Most crucially, on a financial level, the cost of opening and operating an internet store is very low or non-existent. There is no requirement to buy or keep any of the items in our store. People generate a large amount of revenue via internet sales.

Conclusion

It's time to wrap things up. Now, most of you will agree with me that shopping has changed dramatically over time. Knowledge and information are expanding every day, and internet usage and reach are expanding as well. In our lives, we desire choice, flexibility, security, safety, and cost-effectiveness. As a result, we obtain everything through online purchasing. And the future of Internet commerce is highly promising.

Disclaimer : This article is only for knowledge and information sharing purpose and not for any type of recommendation or promotion of anything to anyone.

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