Articles
Degree of Financial Leverage
Financial leverage arises when a firm has fixed financing costs in its income stream. The presence of financial leverage...
How to Calculate Degree of Operating Leverage
Operating leverage arises when a firm has fixed operating costs in its income stream. The presence of operating leverage...
How to Calculate Annualized Standard Deviation
A stock trader will generally have access to daily, weekly, monthly, or quarterly price data for a stock or a stock port...
The Accounting Equation
Businesses exchange items of equal value, real or perceived. Imagine that an exchange is like balancing a scale: the le...
Put Option Payoff
A put option is the right, but not the obligation, to sell an asset at a prespecified price on, or before, a prespecifie...
Call Option Payoff
A call option is the right, but not the obligation, to buy an asset at a prespecified price on, or before, a prespecifie...
How to Buy Shares
Shares are one of the most important and lucrative investment classes. Some of the richest people in the world have crea...
Global Depositary Receipts
Global Depositary Receipts (GDRs) give issuers exposure to the global markets outside their home market. Depositary r...
American Depositary Receipts (ADRs)
American Depositary Receipts (ADRs) offer the issuing company access to the US capital market and at the same time provi...
Class A and Class B Common Stock
A company can also issue various classes of common stock, such as Class A and Class B, with each class having different ...
Voting Systems: Statutory Voting and Cumulative Voting
Common shares provide voting rights to the shareholders which provide the shareholders the ability to participate in maj...
Convertible Preference Shares
Convertible preference shares give the preference shareholders the right to convert their shares into a specified number...
Preference Shares - Meaning, Types and Features
Preference shares are another type of equity securities issued by firms that combine the features of common shares as we...
Common Equity Shares - Meaning and Features
Equity refers to the ownership interest or residual claim in the assets of a firm after all the liabilities of the firm ...
Arbitrage-free Valuation Approach for Bonds
The simplest way to calculate the value of a bond is to take the cash flows of the bond till its maturity and then disco...
Calculate the Value of a Zero-coupon Bond
Suppose you have a pure discount bond that will pay $1,000 five years from today. The bond discount rate is 12%. What...
Calculate the Value of a Coupon Paying Bond
The value of a coupon paying bond is calculated by discounting the future payments (coupon and principal) by an appropri...
What does gold mean in the 21st century economy?
Bringing back the economy’s gold standard According to Christian Post, gold is a pillar of “tangible and transportabl...
Ways To Send Money Overseas
If you are running a business, there is going to come a time when you want to make an overseas purchase. This may be a ...
Forex Trading for Beginners – A Guide
Thanks to a variety of confusing terms and the potential for losing money whilst trading, many people are both unaware a...
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