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Showing posts from June 6, 2021

Beta- Analyzing mutual funds

 The risk of any investment made always depends on the volatility in the following investment. If we can have a factor that could tell us about the volatility of a investment and help us judge our risk and corelate it with our capability to take risk, how would that be? Well Beta factor is one such factor that could help us know the sensitivity of our stock or portfolio fund that we have chosen to invest. Beta ratio:- Understanding Beta:-  Beta is a metric used in fundamental analysis to determine the volatility of a stock with comparison to the overall market that has a fixed beta ratio of 1 always. Stocks or funds that are ranked with a beta ratio above 1 generally tend to fluctuate more and hence give access to more risk but yielding higher returns too at the same time if gone in favour. While the risk is slightly less in the funds with beta ratio below 1 they give less but yet stable return on investments generally. Hence, the beta factor can be said as a risk- reward factor, helpi

Rising crude oil and its hurdle to Indian economy

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Petrol and Diesel prices both have breached the Rs. 100 mark and crude oils continue to rise with the opening of the economy, geopolitical fears, overpotential demand supply disruption or any policy stands taken by OPEC countries( Organization of the Petroleum Exporting Countries) , all around the world. Officials at oil marketing companies have however noted that even current record-high prices are lower than what refiners should be charging in line with international prices and that prices are set to rise further unless there is a cut on levies on autofuels or a fall in crude oil prices.   But, How could this effect the Indian economy indirectly or directly? Well let's discuss. India being the third largest importer of crude oil spends a huge amount on crude oils buying almost 1.5 billion barrels of crude oil every year at approx which accounts to almost 85% or more of its total crude oil requirements.  Well I hope you might be aware that the exchange currency for buying the crud

Devaluation and depreciation of currency. Are they same???

When the value of currency decreases, people often get confused between devaluation and depreciation. But what is the difference? Is the value of currency really important to be a developed nation? Devaluation:-   Devaluation is the deliberate downward adjustment of the value of a country's money relative to another currency or currency standard. It is done deliberately to reduce the export costs and shrink trade. It also helps in paying debts by printing of more notes which also decreases the value of money. Unlike depreciation, it is not the result of nongovernmental activities. This is often done to render themselves more efficient in the global market and gain better foreign investments by offering a low labour cost to the foreign companies. A export oriented country would always prefer to stay more committed towards a lower currency value as cheaper costs would attract more investors. Depreciation:-  Currency depreciation is a fall in the value of a currency in a floating exch

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