Thursday, 14 July 2011

Derivatives for dummies - Currency Forwards

The valuation of currency forwards are based on some of the very basic principles of Macroeconomics. Interest rate parity:- According to the Interest rate parity principle, suppose you invest in your home country and earn a return, this return has to...
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Monday, 4 July 2011

Derivatives for dummies: Hedging strategies using forward contracts

An important question that the investors face is how to protect their portfolio in times of volatility. One way is getting out of the cash markets (stock market) for now and entering again when market stabilizes. But this strategy may lead to a lot...
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Friday, 1 July 2011

Derivatives for Dummies II

FORWARD MARKETS AND CONTRACTS FORWARD CONTRACTS A forward contract is a contract between two parties in which one party agrees to buy and one party agrees to sell a particular asset at a particular date in future. Suppose today is June 13th and the...
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Friday, 24 June 2011

Derivatives for Dummies-An Overview

A derivative instrument, broadly, is a financial contract whose pay off structure is determined by the value of an underlying commodity, security, interest rates, share price index, exchange rate, oil price etc. Just think of a contract whose price or...
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Saturday, 19 March 2011

Role of PE firms

PE firms perform a number of roles in the investee company. They can be majorly classified as follows: ·       Source of CapitalThe main role of PE firm in any investee organization is to provide capital which may not...
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Thursday, 17 March 2011

STOCK PRICES JUGGLING IN 2011

There has been turmoil of sorts in the Indian stock market in the recent months. On 4th of February, investors lost a mammoth Rs 1.2 trillion. We have tried to capture the reasons behind the convulsion in the points listed below. Inflation: In January,...
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Wednesday, 16 March 2011

PTC India Financial Services IPO (update)

The price band has been fixed at Rs. 26-28 per share for the IPO that will be open from 16th March to 18th March, 2011. The shares are to be offered through a 100% book building process. The company is to raise Rs. 407-439 crore depending upon the issue...
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Sunday, 6 March 2011

PTC Financial Services IPO by mid-March

PTC India Financial Services (PFS), an arm of the state-run PTC India, has received a nod from market regulator SEBI for an initial public offering (IPO) and plan to come out with it by mid-March. This clearly shows that firms are still upbeat about...
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Saturday, 5 March 2011

Budget 2011-12 - Analysis

This budget has been presented when rising inflation worries are overshadowing Indian growth story. Inflation rate of more than 8% and food inflation in double digits has already brought the SENSEX to its 6 months low. Finance Minister had the daunting...
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