common terms in finance
TRANSCRIPT
It refers to the percentage of the amount that banks have to keep with themselves in the form of :-
Bank rate, also referred to as the discount rate, is the rate of interest which a central bank charges on
That it extends to Commercial Banks and other Financial Intermediaries.
Repo rate is the rate at which commercial banks borrow rupees from RBI.
Ask price is a price a seller of a good is willing to accept for that particular good.
In the context of stock trading on a stock exchange, the ask price is the lowest price a
seller of a stock is willing to accept for a share of that given stock.
For mutual funds, the asking price is the net asset value plus any sales
charges.
Degree of Financial
Leverage=
Percentage Change in
EPS
Percentage Change in
EBIT
Firm’s ability to use Fixed Operating Cost to magnify the effect of changes in Sales on its Earnings Before
Interest and Tax
Degree of Operating Leverage = Percentage Change in EBIT
Percentage Change in Sales
An investment made in order to reduce the risk of adverse price movements in a security, by taking an offsetting position in a related security, such as an option
or a short sale.
A gain or loss in the cash position due to changes in price levels will be countered by changes in the value of a futures position.
The hedger tries to fix the price at a certain level with the
objective of ensuring certainty in the cost of production or
revenue of sale.