The Phenomenon of Conglomerates – A Case Study of ITC
The Phenomenon of Conglomerates – A Case Study of ITC
Investing in Conglomerates is Tricky! Learn to Tackle the Challenge
The Phenomenon of Conglomerates – A Case Study of ITC
ITC Limited has nearly doubled since February 2022 and now it is trading at its all-time high of Rs.443 (8th June 2023). Most brokerage houses have been issuing research reports that recommend it as a Buy or Add. Now, as a thinking retail investor, how do you look at it? How do you decide if you will buy it now if you missed putting it in your portfolio or will you hold it if you are already sitting on some nice long term capital appreciation?
The Secret Formula for Selling Stocks at the Right Time Revealed
The Secret Formula for Selling Stocks at the Right Time Revealed
These are valuable lessons for any investor who wants to achieve success in the stock market.
One important lesson Karan learned was the significance of evaluating a stock's market value in relation to its intrinsic worth. Just as a precious gem's value can be determined by its clarity and cut, a stock's true value lies beneath its market price.
The Art of Quick Diagnosis of a Stock
The Art of Quick Diagnosis of a Stock
Often friends tell me, “Buy stock X at the current price. It will double in two years.”
When you buy a Rs.25,000 mobile or a refrigerator, you would spend quite some time researching for the machine with the best package of features, reliability, prestige value, and cost. That would often take hours on the internet and a couple of visits to the store; so why not spend less than an hour on the stock you have been tipped to buy?
Unveiling the Truth About Cyclical Stocks: Why They Aren't a 'Forever' Bet and How They Really Work!
Unveiling the Truth About Cyclical Stocks: Why They Aren't a 'Forever' Bet and How They Really Work!
When do cyclical stocks outperform and underperform?
Commodity cyclicals can be one of the most challenging sectors to analyze, comprehend and profit from due to the market participants' inability to accurately predict the movement of underlying commodity prices, which influences the fluctuation in the prices of these stocks.
Types of Momentum Investing
Types of Momentum Investing
Momentum investing resonates with the prominent proverb – ‘cut your losses and let your profits run.’
Momentum strategy aims at buying high and selling even higher.
Explained: Free cash flows, types, and valuation
Explained: Free cash flows, types, and valuation
As free cash flows provide a sound basis for evaluation, it is often considered that free cash flow models are more useful than DDM models, in practice.
Discounted cash flow, which is popularly known as DCF valuation, denotes the intrinsic value of a security as the present value of its expected future cash flows. When applied to dividends, the DCF model is the discounted dividend approach or dividend discount model (DDM).
Is Justified P/E ratio same as Standard P/E ratio? Let's find it out in the below article!
Is Justified P/E ratio same as Standard P/E ratio? Let's find it out in the below article!
Justified P/E associates a particular value of the P/E with a set of forecasts of the fundamentals and the dividend payout ratio.
The valuation of a company is a critical aspect for analysts and investors studying a potential company for investment purposes. The most commonly used, valuation metric is the price-to-earnings ratio which is, defined as the ratio for the valuation of the company, which measures its current share price relative to its earnings per share (EPS).
Explained: EV to sales ratio
Explained: EV to sales ratio
EV to sales ratio is one of the simplest multiples for valuation purposes. During the process of mergers and acquisitions, the ratio gives all parties a good idea.
Enterprise value-to-sales (EV/sales) is a financial ratio measuring the company’s total value (in enterprise value terms) to its total sales revenue. To simplify more, it is EV per dollar of sales. This means that the higher the ratio, the more ‘expensive’ or valuable the company is, and vice versa. The ratio is used for financial analysis and valuation strategies while doing research for a potential investment.
Which type of investor are you - hedger, speculator or arbitrageur?
Which type of investor are you - hedger, speculator or arbitrageur?
Investors prefer derivatives as they facilitate price discovery, strengthen the underlying asset's liquidity, and work effectively as a hedging tool.
Investors prefer derivatives as they facilitate price discovery, strengthen the underlying asset's liquidity, and work effectively as a hedging tool.
ROIC vs ROCE: Decoding the difference between key performance ratios
ROIC vs ROCE: Decoding the difference between key performance ratios
Which one is a superior metric? Let us find out.
Return on Invested Capital (ROIC) and ROCE (Return on Capital Employed) are financial ratios to understand how efficiently a company invests its capital.
Why do investors prefer derivatives over underlying assets?
Why do investors prefer derivatives over underlying assets?
A ‘derivative’ is a financial contract or a security with a price. Derivative contracts come in many different forms, such as forwards, futures, options, and swaps.
A ‘derivative’ is a financial contract or a security with a price. Derivative contracts come in many different forms, such as forwards, futures, options, and swaps.
Here are the key terms one must know while analysing a banks financial performance
Here are the key terms one must know while analysing a banks financial performance
With the rising interest rates and looming recession, it becomes of utmost importance to analyse a bank’s ‘health condition’.
In this educative article, we shall introduce you to the basic banking terms that are a ‘must-know’ in analysing financial reports.