Investment Insights

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Reinvestment Risk

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Reinvestment risk is one of the risk investor faces when invested in debt market.   It refers to the risk that the coupon or principal amount will have to be reinvested at a lower yield rate prevailing at the time of maturity or when the coupon amount is received.   Reinvestment risk is greatly influenced […]

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  Industry sector’s share in total GDP has mostly remained stagnant between 10% and 20% since FY1951, FY2014 being 18.7%.   Industry sector is broadly divided into 3 subsectors namely – Mining & Quarrying, Manufacturing and Electricity, Gas & Water Supply.   Manufacturing sector since FY1951 has the largest share contribution to the industry sector. […]

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A company can raise capital either by issuing debt or equity.   It can raise equity capital via public issue, rights issue, bonus issue or private placement.   Public issue refers to issue of shares to new investors and can classified as initial public offer (IPO) and offer for sale (OFS)1.   IPO snap shot  […]

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Per Capita Income

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Per capita income refers to income earned per person in a country on an average basis.   It is calculated by dividing country’s national income by its total population.   Per capita income is used as a tool to measure a country’s standard of living. However, it represents average income per person therefore does not […]

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Moving Average

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Moving average is a technical trend indicator used to gauge price direction of the stock or index.   As the name implies, it averages the price of the stock or index and as the price data moves, average also moves.   New daily price is included to calculate the average and old price data is […]

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Service sector is broadly divided into construction, trade, hotels, transport & communication, finance, insurance, real estate, community and social & personal services.     Since 1951, trade, hotel, transportation & communication sector has always had the highest share in service sector.   Over the years, share of finance, insurance, real estate & business service has […]

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Consumer level price changes of goods and services are measured by CPI.   Earlier India did not have a single CPI but there were four CPI namely CPI-Industrial workers, CPI- Rural Labourer, CPI-Agricultural Labourer and CPI-Urban Non-Manual Employees.   However CPI-Urban Non-Manual Employees has been discontinued and a new index was launched.   New CPI […]

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Indian economy is broadly divided into 3 sectors which contribute to the gross domestic product of (GDP)1 of the country namely agriculture and allied activities, industry and services.   Agriculture and allied activities include agricultural products, livestock, forestry & logging, fishery.   Share of agriculture and allied activities sector to total GDP was 13.94% in […]

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History of Personal Income Tax of India      In India, personal income tax is paid on the income earned. Higher the income, higher the tax paid.   Over the years, income tax slabs and rates have undergone a lot of changes.   Compared to today, historically tax rates were much higher with more income […]

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Alpha

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What is alpha?  Alpha refers to the excess return on a stock portfolio or fund over and above the benchmark1.   Alpha = Actual Portfolio Return – Benchmark Return  Generally, one generates alpha by actively managing a stock portfolio or fund with diversification, risk management.   It is one way to measure stock portfolio or […]

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