The most comprehensive educational resources for finance

How to Become a Derivatives Trader?

I received a question from one of the users asking me about how he can build a career as a derivatives trader on Wall Street. In this post I will explain the role of a derivatives trader and what you can do to become one. So, what does a derivatives trade do? As the name

JOBS Act 2012 – Jump Start Your Business (or Not)

Jump Start Our Small Businesses Act or the JOBS Act was passed by the U.S Senate, 73 to 26 on March 22 2012. The Bill was amended before its vote. The highlights of the ACT include: A company can now have a higher number of stock holders before it is required to go public and

Financial Analyst: A Rapidly Growing Career Option in Finance

During the recent financial crisis of 2008, this was one career that was badly affected. We saw many financial analysts working in large investment banks losing their jobs and the future looked bleak. However, with the recovering economy, the prospects for this career option are again looking good. As per the recent projections by the

Real Estate Portfolios

In developed countries such as US and Europe, there are real estate indexes that provide a measure of average returns on real estate investments. Other countries also have recently developed real estate indexes. The returns from real estate consist of income and capital appreciation. Measuring the income from a property is easy but assessing appreciation

Real Estate Valuation: Part 3 (Discounted Cash Flows)

This approach is called Discounted After-Tax Cash Flow Approach. This method is used as a supplement to the other valuation methods, such as cost, sales, and income approach. Under this approach, the investor calculates the net present value of after-tax cash flows from the property discounted by his required rate of return. For the investment

Wealth Management: Clients and their Satisfaction

Evaluation Point for Banks and Wealth Management Arms; Does WIPRO offer some food for thought? Ever wondered how people involved in wealth management are evaluated. It should be a no brainer: a wealth manager should be evaluated based on the basis of money made by clients through his investment. If not entirely, but a larger

The Mechanics of Carry Trade

Carry trade is a strategy in which an investor borrows or sells a financial instrument with low interest rate and uses the proceeds to lend or purchase a financial instrument with high interest rates. For example, an investor can borrow money in another country’s currency where the interest rates are very low, and lend the

Sources of Return from Commodity Investments

An investor can invest in commodities by taking a collateralized long position in commodities derivatives such as futures, forwards, and swaps. There are three primary sources of return:  1. Collateral Yield: Long derivative positions require margin, which acts as collateral. Collateral yield is the return earned on this margin money. It’s generally equivalent to T-bill

The Different Forms of Real Estate Investments

Everyone likes to own a piece of land they can call their own. This can be as shelter or as increasingly the case is turning out to be as a worthwhile investment. Real estate would include homes, offices, retail spaces, parking lots, apartments, warehouses, etc. It is a tangible, immovable asset. Insurance and pension funds

Ratios to Assess Stock Value for Beginners

For a lot of us playing the stock market seems like risky business, which needs an extremely high level of expertise. The stock market seems full of complexities. How to pick a stock, which sector, how to assess their performance are all questions that most beginners ask. There are some basic ratios that are used