One of the most enigmatic financial and investment strategies of the companies has been the stock split. Why is such a stock split done and how does it affect the company, its finance? How does the stock split affect the investment decision of the investors?
With a stock split the number of shares is increased through […]
The payback period of an investment project indicates to the investor the number of years required to recover the initial cash investment bases on the project’s future cash flows.
If the payback period of the initial investment in within the accepted time frame the project is deemed viable from the investor’s point of view, if not, […]
While considering a decision to invest in marketable securities every portfolio manger (you) must analyze how each potential investment purchase relates to certain key investment variables:
Safety
The most basic test that all investments much pass is the first concern of safety of invested principal. It indicates the probability of getting back the same amount of fund […]
There are three levels of market efficiency:
Weak form efficiency - the current pricing reflects the historical sequence of prices. In other words, knowledge of the past pricing patterns will not help in forecasting the future price trends.
Semi-strong from efficiency - current pricing fully reflects all information held in the public domain like the annual reports, […]
Investors and folks who still remember the stock market crash of 1987 are bound to question the efficiency of markets. The stock markets went into a tailspin and lost around 20% of their valuation in a matter of few hours.
The stock prices increase in step by step mode over an extended period of time, but […]
