Returns and Risks involved in Bonds – Part 2
In the previous article on Bonds – Part 1, we discussed the basics of Bonds and some important terms related to bonds. We also mentioned… Read More »Returns and Risks involved in Bonds – Part 2
Finance
What Are Bonds And What Happens When It Is Traded? – Part 1
In one of our previous articles on How a company raises capital, we discussed raising capital using two methods. One is equity and the other… Read More »What Are Bonds And What Happens When It Is Traded? – Part 1
Secondary market and it’s structure
In the previous Article, we discussed IPO. IPOs are issued in the primary market. Secondary market is where securities once issued are bought and sold… Read More »Secondary market and it’s structure
What is IPO and different types of investors:
In the previous article, we discussed the debt and equity instruments used to raise capital for a company. When the owner of the private company… Read More »What is IPO and different types of investors:
How a company borrows from the market?
Let’s discuss How a company borrows money from the market. When there is a personal need we borrow money usually from a bank or from… Read More »How a company borrows from the market?
Normal Contango and backwardation
Contango and Backwardation is used in the commodity market. This is two different situation based on the spot price and future price. Before going into… Read More »Normal Contango and backwardation
Mean reverting price in commodities market
Commodities and its purpose: Commodities can be used for two purposes such as investment purpose and consumption purpose. Example of Investment purpose commodities are metals… Read More »Mean reverting price in commodities market
Credit Risk
Let’s discuss what does Risk means. Risk is simply called uncertainty. For example, when you lend money to your friend and there is a risk when you are not sure about getting back since he lost his job recently.
Similarly, when you consider banking, their main business is to make people deposit in their bank and lend money to others. Credit risk arises due to uncertainty of collecting back the money from borrowers. Credit risk can be high when the credit quality of the borrower is low. Due to lower credit quality and non-repayment of borrowed loans, Banks can expect losses. These losses are calculated as Expected Loss
Read More »Credit Risk