Basics of Finance/ Stock Market

  Mutual Funds Mutual Funds What are mutual funds? It is a way to invest in which money is pooled to invest in stocks, bonds, etc.; it is an excellent way for people who don’t have a massive chunk of money (for stocks, real estate, gold, etc.) and knowledge of the stock market. Here a fund manager manages your funds, and it is dependent on his trades that decide your fortune. Types of mutual funds: 1.   Equity Mutual Funds : In this, your money is invested in the stock market. 2.   Debt Mutual Funds : In this, your money is invested in debt, which means less risk as well as fewer returns. 3.   Hybrid Mutual Funds : In this, your money is invested in both equity and debt. 4.   Goal-oriented Funds : these are funds one makes for some specified goal in mind. 5.   Other Funds : Mainly index funds, in this money is in invested in the index. A mutual fund gives small investors access to a professionally managed portfolio, but it has its demer...

  Inflation Inflation It is the most important financial term in our lives. It is referred to as a rise in the prices of goods and services of daily use (other than these, our life cannot go smoothly). It is measured in percentage change in avg. price of these everyday use commodities. In simple words, if suppose inflation rate is 7p.a. and your monthly expense is around 10000, then after one year, it will be around 10700. This number seems to look so small in the short run, but in the long run, it is very much as it is getting compounding every year. If you don’t invest your money and let it be dormant in a savings account with a 2% interest rate, you are losing around 5% every year. And in F.Ds with 5.5% interest rates, you are losing approximately 1.5% every year. And the Inflation rate I have taken is avg. inflation rate, while during hyperinflation, these rates go as high as 10-15% , so now you can calculate how much money you are losing every year.  In India, the Minist...

ITC Itc Analysis Incorporated in the year 1910, is a Large Cap. Company operating in Tobacco sector ITC Ltd. key Products/Revenue Segments include Packaged Food Item, Agricultural Products, Paper & Paper Boards, Others, Service (Hotel),Tobacco Unmanufactured, Printed Materials. With 75% market share in cigarettes. True Value Stock indeed! A great pick on the basis of fundamental analysis. Dividend Yield: 5.19%