A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. In a monopoly market, factors like government license, ownership of resources, copyright and patent and high starting cost make
Cash and carry trade is an arbitrage strategy which involves buying the underlying asset of a futures contract in the spot market and carrying it for the duration of the arbitrage. Traders use this strategy to take advantage of the difference between the price of the underlying security and its corresponding futures price. The trade
The Return On Equity ratio essentially measures the rate of return that the owners of common stock of a company receive on their shareholdings. Return on equity signifies how good the company is in generating returns on the investment it received from its shareholders. Mathematically, Return on Equity = Net Income or Profits/Shareholder’s Equity. The
Return on Capital Employed or RoCE essentially measures the earnings as a proportion of debt+equity required by a business to continue normal operations. In the long run, this ratio should be higher than the investments made through debt and shareholders’ equity. Otherwise diminishing returns shall render the business unsustainable. This is a better measure of
Dividend refers to a reward, cash or otherwise, that a company gives to its shareholders. Dividends can be issued in various forms, such as cash payment, stocks or any other form. A company’s dividend is decided by its board of directors and it requires the shareholders’ approval. However, it is not obligatory for a company
Beta is a numeric value that measures the fluctuations of a stock to changes in the overall stock market. Beta measures the responsiveness of a stock's price to changes in the overall stock market. On comparison of the benchmark index for e.g. NSE Nifty to a particular stock returns, a pattern develops that shows the
It is a rate at which the price of a security increases or decreases for a given set of returns. Volatility is measured by calculating the standard deviation of the annualized returns over a given period of time. It shows the range to which the price of a security may increase or decrease. Volatility measures
A Rights Issue is a method through which companies can raise additional capital from their existing shareholders. Normally these stocks are offered at a discounted price than the existing market price. The Right Issue is attractive because the existing shareholder gets profit probably at the outset itself. It would be a Win-Win situation for both
Moat is a ditch around the castle .It is filled with water that makes it difficult to attack for the enemies to attack the castle. The Concept of the Moat in Investing was propounded by Warren Buffet himself. Warren Buffet advises finding stocks with strong Economic Moats. If a stock is equipped with strong Moats,
A blue-chip is a stock with a good reputation for quality, reliability, and the ability to operate profitably in good and bad times. These stocks are known to have the capabilities to endure tough market conditions and give high returns in good market conditions. They withstand the pressures of the Bear market and perform very
