What is Expense Ratio?
MEANING Expense ratio is an annual fee charged by the mutual funds to meet its expenses which are incurred for managing the funds. A mutual fund is a trust that pools money from a number of investors who share a…
FINANCE CRACKER
Decoding Finance
VINEET SINGH
What is Mutual Fund?
MEANING Mutual Funds are trust that pools money from a number of investors who share a common financial goal and invests the same in equities, bonds, money market instruments and/or other securities. Mutual funds are the most suitable investment for…
Put Option
What is Put Option? Put Option is a contract between two parties under which option buyer gets the right to sell the underlying or original asset (Stock, bond, index, commodity) at pre-determined price (Strike Price) within a specified period. But…
Call Option
What is Call Option? Call Option is a contract between two parties under which option buyer gets the right to buy the underlying or original asset (Stock, bond, index, commodity) at pre-determined price (Strike Price) within a specified period. But…
Option Contract Explained in Easy Language
What is option Contract? Option is a contract between two parties to buy or sell an underlying asset. This derivative contract provides buyer a right to buy or sell specified quantity of an underlying on or before a specific date…
Derivative
DISCUSSION AT A GLANCE Meaning- Derivative is a product or contract or instrument, which get its value from the value of an original or underlying asset or group of assets. Use of Derivative- hedging, speculation, arbitrage or leveraging trades Market…
International Fisher Effect
What is International Fisher Effect Theory ? International Fisher Effect theory is combo of two theories, fisher effect and relative Purchasing Power Parity. According to this theory exchange rate differential between two countries over period of time would be approximately…
Fisher Effects
What is Fisher Effect Theory? Fisher Effect theory is created by economist Irving Fisher. According to this theory real interest rate equal to nominal interest rate minus expected inflation rate but this is an approximate estimation. This theory decomposes nominal…
Purchasing Power Parity
What is Purchasing Power Parity? The Purchasing Power Parity (PPP) theory connects forex market to commodity market. According to this theory exchange rate between two currencies of two country depends upon purchasing power to buy same basket of goods in…
Interest Rate Parity
What is Interest Rate Parity? Interest rate parity is a no-arbitrage condition. In simple word an investor will not be allowed to gain a riskless return by borrowing at lower rate in one country and investing at high rate in…