Finance

Definition: Certificate of Deposit (CD) implies an unsecured, money market negotiable instrument, issued by the commercial bank or financial institution, either in demat form or as a usance promissory note, at a discount to face value at market rates, against the amount deposited by an individual, for a stipulated time. In finer terms, certificate of deposit is a fixed … [Read more...] about Certificate of Deposit (CD)

Definition: Factoring implies a financial arrangement between the factor and client, in which the firm (client) gets advances in return for receivables, from a financial institution (factor). It is a financing technique, in which there is an outright selling of trade debts by a firm to a third party, i.e. factor, at discounted prices. Factoring is a financial alternative, in … [Read more...] about Factoring

Definition: Credit Rating can be defined as the assessment of the ability of the borrower, to discharge their financial obligations. It is an approximation of the creditworthiness of an individual, entity or commercial instrument, considering various factors, representing the capability and willingness, to pay financial commitments in time. Credit rating is instrument … [Read more...] about Credit Rating

Definition: Margin of Safety (MOS) is defined as the excess of actual or projected sales over break-even sales, that can be expressed in monetary terms or units, or as a percentage of total sales. The margin of Safety implies the sales point over and above the break-even point, that results in profit. Break-even point (BEP), is the point wherein total cost and total revenue … [Read more...] about Margin of Safety

Definition: Treasury Bills, also known as T-bills are the short-term money market instrument, issued by the central bank on behalf of the government to curb temporary liquidity shortfalls. These do not yield any interest, but issued at a discount, at its redemption price, and repaid at par when it gets matured. T-bills are the key segment of the financial market, which is … [Read more...] about Treasury Bills

Definition: Financial Market refers to a marketplace, where creation and trading of financial assets, such as shares, debentures, bonds, derivatives, currencies, etc. take place. It plays a crucial role in allocating limited resources, in the country's economy. It acts as an intermediary between the savers and investors by mobilising funds between them. The financial market … [Read more...] about Financial Market

Definition: The Post Office Recurring Deposit Account works on the same principle as that of the recurring deposit account in a bank, where the investor can deposit a fixed sum of money on a monthly basis. It is a scheme offered by the department of post and backed by the government of India on which fixed interest is paid. The salient features of the Post Office Recurring … [Read more...] about Post Office Recurring Deposit Account

Definition: The Post Office Monthly Income Scheme is a saving scheme backed by the government of India on which fixed interest is paid. This scheme is offered by the department of post and aims at providing regular monthly income to the depositors. The post office monthly income scheme offers several features to help investors to earn regular monthly returns on the deposits. … [Read more...] about Post Office Monthly Income Scheme

Definition: The Post Office Time Deposits are a saving scheme offered by the Indian Postal Service on which a fixed interest is paid. Often, the investors deposit a good chunk of their financial assets with a view to earning a fixed interest on it. The Post Office Time Deposits are similar to the fixed deposits of commercial banks (a saving or term deposit account opened in … [Read more...] about Post Office Time Deposits

Definition: The Post Office Savings Account is the deposit scheme offered by the department of post on which fixed interest is paid. The individual investors deposit a good portion of their financial assets in a postal savings account in order to earn a fixed rate of interest on the investments. The post office savings account is similar to a saving bank account ( a portion … [Read more...] about Post Office Savings Account