This document provides an overview of investment concepts including:
- The different types of financial and real assets that make up an investor's portfolio, such as stocks, bonds, real estate, and commodities.
- Key considerations for investors like risk, returns, diversification, and the tradeoff between risk and return.
- The different players and structures in capital markets, including stock exchanges, market indices, and margin trading.
- Concepts of fundamental analysis, technical analysis, and valuation methods that investors use to evaluate assets.
The document covers these concepts across 15 modules in detail with examples and calculations. It is intended as an introductory resource for understanding the landscape of investment opportunities and analysis.
This document provides an introduction to bond markets, including:
- A brief history of war bonds and the growth of bond markets since the 1970s.
- Defining bonds as debt instruments issued by borrowers to raise capital from lenders/investors.
- Describing the roles of primary dealers, central banks, and how globalization has impacted bond markets.
- Noting some past difficulties in bond markets like lack of a centralized marketplace and complexity.
- Stating bonds represent debt contracts and have similarities to both bank loans and equity markets.
The document provides definitions and examples of key concepts related to landscape from various fields including architecture, art, philosophy, and literature. It begins with definitions of "hermetic" and "inflection" from architecture. It then discusses the philosophical concept of "dialectic" and provides examples of art that demonstrate dialectic principles, including works by Escher and Aalto. The document continues giving examples from landscape painting, architecture, and other art forms that illustrate concepts like figure/ground relationships, vicarious vs. visceral experience, and landscapes as both noun and verb. It concludes with several quotes analyzing landscapes as man-made spaces that mediate nature.
This document discusses key concepts in geomorphology including geomorphological processes that have shaped the Earth over billions of years such as tectonic movement, weathering, erosion, transportation, and deposition. It notes that these geomorphological processes require agents to perform the work, listing examples of agents such as gravity, water, wind, ice, and their associated landforms including rock pedestals, erratics, spits, oxbow lakes, stacks, and folds with unconformities.
Landscape design involves planning and designing outdoor spaces by considering various factors related to the site, climate, infrastructure, and human needs. Some key factors in landscape design include climate, topography, drainage, codes and regulations, soils, access, recreation areas, safety, and artistic composition. The design process involves site analysis, site planning, and developing a site plan. Site analysis involves researching and mapping information about a site such as slope, soils, vegetation, and hydrology. Site planning organizes the use of land and placement of elements. A site plan is a detailed drawing that shows the arrangement of all buildings, structures, and landscape elements within a property to scale.
The document provides details of Joan Tachado's landscape architecture portfolio, including their curriculum vitae, professional experience, and major projects. It describes Joan's education and awards, positions held at various companies in Australia, the Philippines, and United Arab Emirates, and roles on several large-scale projects including residential and commercial developments, airports, and parks.
This document provides information about a landscape architect named Suvarna Lele and their projects. It discusses how creating green spaces can improve urban quality of life by maintaining ecological balance. An architect has responsibility regarding environmental degradation and creating eco-friendly designs. The document also includes images of some of Lele's projects, which include a concrete pergola painted to look like wood, rock gardens, gravel and lawn layouts, brick kiosks, and other landscape elements like retaining walls, sculptures, lighting, plants and shrubs. Floor plans are also included for one of the projects.
Landscaping refers to modifying the visible features of an area of land through both living and non-living elements. Key elements of landscape design include plants, water features, and stones. Plants are used to frame buildings, define spaces, and provide environmental benefits. Water features such as fountains and ponds add aesthetic appeal and ecological value. Stones are utilized for structures like retaining walls, pathways, and decorative elements. Together, the thoughtful incorporation of these natural and manmade components can transform exterior spaces.
This document provides an introduction to bond markets, including:
- A brief history of war bonds and the growth of bond markets since the 1970s.
- Defining bonds as debt instruments issued by borrowers to raise capital from lenders/investors.
- Describing the roles of primary dealers, central banks, and how globalization has impacted bond markets.
- Noting some past difficulties in bond markets like lack of a centralized marketplace and complexity.
- Stating bonds represent debt contracts and have similarities to both bank loans and equity markets.
The document provides definitions and examples of key concepts related to landscape from various fields including architecture, art, philosophy, and literature. It begins with definitions of "hermetic" and "inflection" from architecture. It then discusses the philosophical concept of "dialectic" and provides examples of art that demonstrate dialectic principles, including works by Escher and Aalto. The document continues giving examples from landscape painting, architecture, and other art forms that illustrate concepts like figure/ground relationships, vicarious vs. visceral experience, and landscapes as both noun and verb. It concludes with several quotes analyzing landscapes as man-made spaces that mediate nature.
This document discusses key concepts in geomorphology including geomorphological processes that have shaped the Earth over billions of years such as tectonic movement, weathering, erosion, transportation, and deposition. It notes that these geomorphological processes require agents to perform the work, listing examples of agents such as gravity, water, wind, ice, and their associated landforms including rock pedestals, erratics, spits, oxbow lakes, stacks, and folds with unconformities.
Landscape design involves planning and designing outdoor spaces by considering various factors related to the site, climate, infrastructure, and human needs. Some key factors in landscape design include climate, topography, drainage, codes and regulations, soils, access, recreation areas, safety, and artistic composition. The design process involves site analysis, site planning, and developing a site plan. Site analysis involves researching and mapping information about a site such as slope, soils, vegetation, and hydrology. Site planning organizes the use of land and placement of elements. A site plan is a detailed drawing that shows the arrangement of all buildings, structures, and landscape elements within a property to scale.
The document provides details of Joan Tachado's landscape architecture portfolio, including their curriculum vitae, professional experience, and major projects. It describes Joan's education and awards, positions held at various companies in Australia, the Philippines, and United Arab Emirates, and roles on several large-scale projects including residential and commercial developments, airports, and parks.
This document provides information about a landscape architect named Suvarna Lele and their projects. It discusses how creating green spaces can improve urban quality of life by maintaining ecological balance. An architect has responsibility regarding environmental degradation and creating eco-friendly designs. The document also includes images of some of Lele's projects, which include a concrete pergola painted to look like wood, rock gardens, gravel and lawn layouts, brick kiosks, and other landscape elements like retaining walls, sculptures, lighting, plants and shrubs. Floor plans are also included for one of the projects.
Landscaping refers to modifying the visible features of an area of land through both living and non-living elements. Key elements of landscape design include plants, water features, and stones. Plants are used to frame buildings, define spaces, and provide environmental benefits. Water features such as fountains and ponds add aesthetic appeal and ecological value. Stones are utilized for structures like retaining walls, pathways, and decorative elements. Together, the thoughtful incorporation of these natural and manmade components can transform exterior spaces.
Vikram Dhumal's project report discusses mutual fund analysis and portfolio management for Vantage Wealth Management Solutions Pvt. Ltd. The report includes chapters on investment management, introduction to mutual funds, measuring mutual fund performance, fees and expenses, accounting and valuation of mutual funds, and the Securities and Exchange Board of India. The objective is to analyze mutual fund performance and study equity, debt, bonds and securities to help investors achieve good returns and capital appreciation through right portfolio selection and investment timing.
Perception of derivatives @ smc investment project reportBabasab Patil
This document provides a summary of a study conducted on investors' perceptions of derivative products in Hubli City. Key findings from the study include:
1) Around 50% of people surveyed in Hubli were unaware of derivatives.
2) Risk, returns, and volatility were the main factors investors considered when investing in derivatives.
3) While derivatives were seen as potentially high returning, they were also viewed as volatile and risky investments.
The document concludes by suggesting ways for SMC Investment Solutions & Services to increase awareness of derivatives in Hubli in order to gain more investors, such as educational seminars and maintaining ongoing contact with customers.
This document summarizes the 2009 EVCA Buyout Report from the European Private Equity & Venture Capital Association (EVCA). Some key findings include:
- Buyout investment activity declined in 2008-2009 due to the economic downturn but has begun to recover. Debt markets stabilized in 2009 but debt multiples remain conservative.
- Fundraising declined in 2008 but has begun to recover in 2009, with North America remaining the largest source of funds. Buyout funds focusing on later stage transactions dominated fundraising.
- The number and size of buyout deals declined in 2008-2009 from previous years, though early stage deals have increased. Investments remained concentrated in traditional sectors like business services.
- Dive
The 2009 EVCA Buyout Report analyzes the impact of the economic downturn on European buyout activity from 2007 to Q3 2009. Key findings include:
- Fundraising declined sharply in 2009, with total funds raised only 8% of 2008 levels and average fund sizes halving.
- Investment amounts dropped significantly more than deal numbers, with more activity in smaller deals. Total investments in 2009 were about a quarter of 2008 levels, though deal numbers were around half.
- Divestment activity held up relatively well through trade sales, though write-offs increased. Performance remained strong for vintage years prior to the downturn, but interim short-term returns turned negative across all fund sizes due to valuation
This document provides details of various certification examinations conducted by the National
Stock Exchange of India. It lists 26 modules across different subject areas of finance and
banking. For each module, it provides information on fees, duration of test, number of
questions, maximum and passing marks, and validity period of certificate. The modules cover
topics such as financial markets, mutual funds, derivatives, banking, depository operations,
financial planning, and more. The fees for the modules range from Rs. 1000 to Rs. 5000 and
the certification validity is between 2 to 5 years depending on the module. Disclaimers are also
provided at the bottom for some modules regarding the language of workbook and option to
take the test
This document outlines various wealth management modules offered by the National Stock Exchange of India. It provides details of 44 modules covering topics like financial markets, mutual funds, derivatives, banking, insurance, portfolio management, and more. The fees for each module ranges from Rs. 1,123 to Rs. 5,618. Each module has a test duration of 60-240 minutes, with 30-80 questions carrying maximum marks of 100 or 140. Modules also specify the minimum passing percentage, which ranges from 50-60%. The validity period for certifications is typically 2-5 years. The document aims to equip individuals with skills to help clients or themselves manage wealth effectively over the long term.
The document provides an overview of the banking sector in Bangladesh. It discusses the banking system in pre-independent Bangladesh and post-independent Bangladesh. It notes that after independence, the significant phenomena were the nationalization of existing banks and the entrance of private commercial banks. The document also provides background on the ownership and establishment of banks in pre-1971 Bangladesh.
A project report on study of banking products and investment behavior of cons...Projects Kart
This document provides a summary of a report on a study of banking products and investment behavior of consumers. It begins with an introduction to the Indian banking system, including new business opportunities in India and major foreign banks operating in the country. It describes investment strategies in India and provides an overview of Standard Chartered Bank, the products it offers including savings accounts, ULIPs, and mutual funds. The report methodology and findings from analyzing consumer investment patterns are presented across several chapters. Key areas of analysis include identifying potential customers, influential factors in investment decisions, and strategies to better tap the market.
This document outlines the curriculum for Capital Market Operations and Derivative Market Operations courses. It includes 10 chapters on topics like the Indian securities market, trading membership, trading systems, clearing and settlement, regulations, and valuation concepts for capital markets. For derivatives, it covers 9 chapters on introduction to derivatives, interest rates and stock indices, futures and options contracts, pricing models, trading, clearing and settlement, and regulations. Students will also complete practical modules on trading software to develop their skills.
Hedge funds (The Indian Context and the Regulatory Framework)Sham Chandak
This presentation in a broad sense gives an idea about the hedge funds, their objectives, their participants, their evolution. It talks about how India attracts the eye of Hedge Fund managers world wide. The growth potential in India as an emerging economy. The various types of Hedge Funds and the strategies implemented. The indices which track Hedge Fund performances around the globe. Some empirical findings about the absolute returns generated by hedge funds. The regulatory framework in India for Hedge Funds as a part of Alternative Investment Funds as guided by SEBI
This document provides an overview of investing and doing business in Turkey. It covers Turkey's geography, political system, economy, major industries, incentives available, business regulations, taxation, and how Deloitte can help foreign investors. The document is an investor's guide that aims to introduce opportunities in Turkey and provide essential information for businesses considering investing and operating there.
Deloitte - How to do business in turkey 2011Unialta
This document provides an overview of investing and doing business in Turkey. It covers Turkey's geography, political system, economy, industries, incentives, regulations, taxes, and how Deloitte can help foreign investors. The document is an investor's guide that aims to introduce opportunities in Turkey and provide essential information for businesses considering investing and operating there.
The document is a report by the Working Group on Warehouse Receipts and Commodity Futures appointed by the Reserve Bank of India. It examines the role of warehouse receipts and commodity derivatives in financing agriculture in India. The report finds that warehouse receipts can improve farmers' access to credit by allowing them to use their stored agricultural produce as collateral. However, it notes that financing against warehouse receipts in India is still limited due to issues like the lack of negotiability of receipts and the absence of electronic warehouse receipt systems. The report makes various recommendations to promote warehouse receipt-based lending and the use of commodity derivatives to help farmers better manage price risks.
Price per earning ratio is very simple and important metric to decide whether any stock is fairly valued or not. The project PE ratio and it's application has been done by MBA student under my guidance.
This document discusses modern approaches to measuring market risk for banks. It describes value at risk (VAR) models, which estimate potential losses over a given period at a certain confidence level, usually 1% or 5%. The document provides an example of calculating VAR using the variance-covariance method for a portfolio with two asset classes. It also briefly mentions stress testing as another modern approach to measure market risk. Overall, the document outlines how VAR models have become important tools for banks to quantify and manage their exposure to market risk.
This document provides an overview of a summer training project on equity analysis of banks. It includes an introduction to technical analysis and fundamental analysis. It discusses the investment portfolio of Kotak Life Insurance, including their investments in various banks. It also outlines the objectives, research methodology, and structure of the document. The document is a summary of a student project analyzing equity investments in banks using both technical and fundamental analysis approaches.
The document provides details of various back office operations modules offered by the National Stock Exchange of India. It includes 38 modules across different subject areas of financial markets. The summary includes:
- The modules range from beginner to advanced level and cover topics such as financial markets, mutual funds, derivatives, banking, insurance, and macroeconomics. Fees for the modules range from Rs. 1,000 to Rs. 5,618 depending on the duration and difficulty level.
- Testing details are provided for each including duration, number of questions, marks, and pass percentage. Certificates are valid for periods ranging from 2 to 5 years depending on the module.
- Modules are offered by NSE as well as
This document analyzes hedge fund strategies in India. It discusses what hedge funds are and their investment approaches. Several hedge fund strategies are evaluated based on their returns from 2006-2010 using the Hedge Fund Research Index and Dow Jones Credit Suisse indices. Merger arbitrage and market directional strategies performed best according to the HFRX index, while emerging markets and managed futures strategies led in the Dow Jones index. Convertible arbitrage ranked lowest in both indices. Indian hedge funds saw strong growth and returns improved in 2010.
This document provides details about an online certification exam on the Banking Sector Module offered by the National Stock Exchange of India.
It includes 15 chapters that cover topics like the introduction and evolution of banking in India and other countries, the structure of the banking sector in India, bank deposits and services, non-performing assets, understanding bank financials, the regulatory framework, and financial inclusion.
The document also provides test details for the Banking Sector Module exam, including the fees, duration, number of questions, marks, and pass percentage for the certification. It notes that the curriculum is available on the NSE website and advises checking the site for any updates to NCFM modules or new offerings.
Vikram Dhumal's project report discusses mutual fund analysis and portfolio management for Vantage Wealth Management Solutions Pvt. Ltd. The report includes chapters on investment management, introduction to mutual funds, measuring mutual fund performance, fees and expenses, accounting and valuation of mutual funds, and the Securities and Exchange Board of India. The objective is to analyze mutual fund performance and study equity, debt, bonds and securities to help investors achieve good returns and capital appreciation through right portfolio selection and investment timing.
Perception of derivatives @ smc investment project reportBabasab Patil
This document provides a summary of a study conducted on investors' perceptions of derivative products in Hubli City. Key findings from the study include:
1) Around 50% of people surveyed in Hubli were unaware of derivatives.
2) Risk, returns, and volatility were the main factors investors considered when investing in derivatives.
3) While derivatives were seen as potentially high returning, they were also viewed as volatile and risky investments.
The document concludes by suggesting ways for SMC Investment Solutions & Services to increase awareness of derivatives in Hubli in order to gain more investors, such as educational seminars and maintaining ongoing contact with customers.
This document summarizes the 2009 EVCA Buyout Report from the European Private Equity & Venture Capital Association (EVCA). Some key findings include:
- Buyout investment activity declined in 2008-2009 due to the economic downturn but has begun to recover. Debt markets stabilized in 2009 but debt multiples remain conservative.
- Fundraising declined in 2008 but has begun to recover in 2009, with North America remaining the largest source of funds. Buyout funds focusing on later stage transactions dominated fundraising.
- The number and size of buyout deals declined in 2008-2009 from previous years, though early stage deals have increased. Investments remained concentrated in traditional sectors like business services.
- Dive
The 2009 EVCA Buyout Report analyzes the impact of the economic downturn on European buyout activity from 2007 to Q3 2009. Key findings include:
- Fundraising declined sharply in 2009, with total funds raised only 8% of 2008 levels and average fund sizes halving.
- Investment amounts dropped significantly more than deal numbers, with more activity in smaller deals. Total investments in 2009 were about a quarter of 2008 levels, though deal numbers were around half.
- Divestment activity held up relatively well through trade sales, though write-offs increased. Performance remained strong for vintage years prior to the downturn, but interim short-term returns turned negative across all fund sizes due to valuation
This document provides details of various certification examinations conducted by the National
Stock Exchange of India. It lists 26 modules across different subject areas of finance and
banking. For each module, it provides information on fees, duration of test, number of
questions, maximum and passing marks, and validity period of certificate. The modules cover
topics such as financial markets, mutual funds, derivatives, banking, depository operations,
financial planning, and more. The fees for the modules range from Rs. 1000 to Rs. 5000 and
the certification validity is between 2 to 5 years depending on the module. Disclaimers are also
provided at the bottom for some modules regarding the language of workbook and option to
take the test
This document outlines various wealth management modules offered by the National Stock Exchange of India. It provides details of 44 modules covering topics like financial markets, mutual funds, derivatives, banking, insurance, portfolio management, and more. The fees for each module ranges from Rs. 1,123 to Rs. 5,618. Each module has a test duration of 60-240 minutes, with 30-80 questions carrying maximum marks of 100 or 140. Modules also specify the minimum passing percentage, which ranges from 50-60%. The validity period for certifications is typically 2-5 years. The document aims to equip individuals with skills to help clients or themselves manage wealth effectively over the long term.
The document provides an overview of the banking sector in Bangladesh. It discusses the banking system in pre-independent Bangladesh and post-independent Bangladesh. It notes that after independence, the significant phenomena were the nationalization of existing banks and the entrance of private commercial banks. The document also provides background on the ownership and establishment of banks in pre-1971 Bangladesh.
A project report on study of banking products and investment behavior of cons...Projects Kart
This document provides a summary of a report on a study of banking products and investment behavior of consumers. It begins with an introduction to the Indian banking system, including new business opportunities in India and major foreign banks operating in the country. It describes investment strategies in India and provides an overview of Standard Chartered Bank, the products it offers including savings accounts, ULIPs, and mutual funds. The report methodology and findings from analyzing consumer investment patterns are presented across several chapters. Key areas of analysis include identifying potential customers, influential factors in investment decisions, and strategies to better tap the market.
This document outlines the curriculum for Capital Market Operations and Derivative Market Operations courses. It includes 10 chapters on topics like the Indian securities market, trading membership, trading systems, clearing and settlement, regulations, and valuation concepts for capital markets. For derivatives, it covers 9 chapters on introduction to derivatives, interest rates and stock indices, futures and options contracts, pricing models, trading, clearing and settlement, and regulations. Students will also complete practical modules on trading software to develop their skills.
Hedge funds (The Indian Context and the Regulatory Framework)Sham Chandak
This presentation in a broad sense gives an idea about the hedge funds, their objectives, their participants, their evolution. It talks about how India attracts the eye of Hedge Fund managers world wide. The growth potential in India as an emerging economy. The various types of Hedge Funds and the strategies implemented. The indices which track Hedge Fund performances around the globe. Some empirical findings about the absolute returns generated by hedge funds. The regulatory framework in India for Hedge Funds as a part of Alternative Investment Funds as guided by SEBI
This document provides an overview of investing and doing business in Turkey. It covers Turkey's geography, political system, economy, major industries, incentives available, business regulations, taxation, and how Deloitte can help foreign investors. The document is an investor's guide that aims to introduce opportunities in Turkey and provide essential information for businesses considering investing and operating there.
Deloitte - How to do business in turkey 2011Unialta
This document provides an overview of investing and doing business in Turkey. It covers Turkey's geography, political system, economy, industries, incentives, regulations, taxes, and how Deloitte can help foreign investors. The document is an investor's guide that aims to introduce opportunities in Turkey and provide essential information for businesses considering investing and operating there.
The document is a report by the Working Group on Warehouse Receipts and Commodity Futures appointed by the Reserve Bank of India. It examines the role of warehouse receipts and commodity derivatives in financing agriculture in India. The report finds that warehouse receipts can improve farmers' access to credit by allowing them to use their stored agricultural produce as collateral. However, it notes that financing against warehouse receipts in India is still limited due to issues like the lack of negotiability of receipts and the absence of electronic warehouse receipt systems. The report makes various recommendations to promote warehouse receipt-based lending and the use of commodity derivatives to help farmers better manage price risks.
Price per earning ratio is very simple and important metric to decide whether any stock is fairly valued or not. The project PE ratio and it's application has been done by MBA student under my guidance.
This document discusses modern approaches to measuring market risk for banks. It describes value at risk (VAR) models, which estimate potential losses over a given period at a certain confidence level, usually 1% or 5%. The document provides an example of calculating VAR using the variance-covariance method for a portfolio with two asset classes. It also briefly mentions stress testing as another modern approach to measure market risk. Overall, the document outlines how VAR models have become important tools for banks to quantify and manage their exposure to market risk.
This document provides an overview of a summer training project on equity analysis of banks. It includes an introduction to technical analysis and fundamental analysis. It discusses the investment portfolio of Kotak Life Insurance, including their investments in various banks. It also outlines the objectives, research methodology, and structure of the document. The document is a summary of a student project analyzing equity investments in banks using both technical and fundamental analysis approaches.
The document provides details of various back office operations modules offered by the National Stock Exchange of India. It includes 38 modules across different subject areas of financial markets. The summary includes:
- The modules range from beginner to advanced level and cover topics such as financial markets, mutual funds, derivatives, banking, insurance, and macroeconomics. Fees for the modules range from Rs. 1,000 to Rs. 5,618 depending on the duration and difficulty level.
- Testing details are provided for each including duration, number of questions, marks, and pass percentage. Certificates are valid for periods ranging from 2 to 5 years depending on the module.
- Modules are offered by NSE as well as
This document analyzes hedge fund strategies in India. It discusses what hedge funds are and their investment approaches. Several hedge fund strategies are evaluated based on their returns from 2006-2010 using the Hedge Fund Research Index and Dow Jones Credit Suisse indices. Merger arbitrage and market directional strategies performed best according to the HFRX index, while emerging markets and managed futures strategies led in the Dow Jones index. Convertible arbitrage ranked lowest in both indices. Indian hedge funds saw strong growth and returns improved in 2010.
This document provides details about an online certification exam on the Banking Sector Module offered by the National Stock Exchange of India.
It includes 15 chapters that cover topics like the introduction and evolution of banking in India and other countries, the structure of the banking sector in India, bank deposits and services, non-performing assets, understanding bank financials, the regulatory framework, and financial inclusion.
The document also provides test details for the Banking Sector Module exam, including the fees, duration, number of questions, marks, and pass percentage for the certification. It notes that the curriculum is available on the NSE website and advises checking the site for any updates to NCFM modules or new offerings.
1. CONTENTS
Module 1: Introduction to the Landscape of Investment
1.1. Investment 3
1.1.1. Meaning and Definition of Investment 3
1.1.2. Nature and Characteristics of Investment Decision 4
1.1.3. Objectives of Investment 6
1.1.4. Need and Importance of Investment 6
1.1.5. Constraints of Investment 7
1.1.6. Investment Process 8
1.1.7. Common Errors in Investment 9
1.1.8. Types of Investor 10
1.1.9. Qualities of Investors 12
1.1.10. Qualities for Successful Investing 13
1.1.11. Investment and Speculation 13
1.1.12. Investment and Gambling 14
1.2. Investment Alternatives 15
1.3. Financial assets 15
1.3.1. Security/Marketable Financial Assets 16
1.3.1.1. Equity Shares 16
1.3.1.2. Preference Shares 16
1.3.1.3. Bonds or Fixed Income Securities 17
1.3.1.4. Derivatives – Innovative Products 17
1.3.2. Non Security/Non-Marketable Financial Assets 18
1.3.2.1. Bank Deposits 18
1.3.2.1.1. Characteristics of Bank Deposits 18
1.3.2.1.2. Various Kinds of Bank Deposits/Accounts 18
1.3.2.2. Other Deposits 19
1.3.2.3. Money Market Instruments 25
1.3.2.4. Mutual Funds 25
1.3.2.5. Life Insurance 25
1.4. Real Assets 26
1.4.1. Real Estate 26
1.4.2. Precious Objects 29
1.5. Capital Market 30
1.5.1. Development of Indian Capital Market 30
1.5.2. Capital Market Reforms 31
1.6. Securities/Stock Trading 32
1.6.1. Introduction 32
1.6.2. Order Size and Time Limit 33
1.6.3. Types of Orders 33
1.6.4. Nature of Transaction in Security Trading 34
1.6.5. Types of Transaction 35
1.6.6. Transaction Costs 36
1.6.7. Clearing Process 37
1.6.8. Settlement of Contracts 38
1.7. Electronic Trading 39
1.7.1. Meaning of Electronic Trading 39
2. 1.7.1.1. Benefits of Electronic Trading 39
1.8. Margin Trading 40
1.8.1. Meaning of Margin Trading 40
1.8.2. Types of Margin 41
1.8.3. Margin Account 42
1.8.4. Mechanism of Margin Trading 44
1.8.5. Advantages of Margin Trading 45
1.8.6. Disadvantages of Margin Trading 45
1.9. World Market 45
1.9.1. Major World Stock Market 45
1.9.2. Types of Securities Traded in World Market 48
1.10. Stock Market Indices 48
1.10.1. Sensex 49
1.10.1.1. Objectives of Sensex 49
1.10.1.2. BSE Sensex 49
1.10.1.3. BSE Sensitive Index 50
1.10.2. Sensex Construction 51
1.10.2.1. Sensex - Scrip Selection Criteria 51
1.10.2.2. Sensex Calculation Methodology 52
1.10.2.2.1. Free-float Methodology 52
1.10.2.3. BSE – 100 Index 53
1.10.2.4. BSE-200 54
1.10.2.5. BSE-500 Index and Sectoral indices 54
1.10.2.6. BSE Bankex 54
1.10.2.7. Dollex-30 55
1.10.2.8. Dollex-200 55
1.10.3. Nifty 55
1.10.3.1. NSE 50 Index – Construction 56
1.10.3.2. CNX Nifty Junior 57
1.10.3.3. S&P CNX 500 57
1.11. Commodity Indices 58
1.11.1. MCX Commodity Indices 58
1.11.2. NCDEX Commodity Indices 60
1.12. Risk 61
1.12.1. Concept of Risk 61
1.12.2. Causes of Risks 61
1.12.3. Sources/Types/Classification of Total Risks 62
1.12.3.1. Systematic Risk 62
1.12.3.2. Unsystematic Risk 63
1.12.3.3. Systematic Risk versus Unsystematic Risk 66
1.12.4. Management Risk 66
1.12.5. Market Risk 67
1.12.6. Interest Rate Risk 69
1.12.6.1. Mitigating Interest Rate Risk 69
1.12.6.2. Calculating Interest Rate Risk 69
1.12.6.3. Types of Interest Rate Risk 70
1.12.7. Inflation Risk/Purchasing Power Risk 70
1.12.8. Credit Risk/Default Risk 72
1.12.8.1. Assessing Default Risk 72
1.12.8.2. Mitigating Default Risk 73
3. 1.13. Measuring Risk 74
1.13.1. Introduction 74
1.13.1.1. Standard Deviation 75
1.13.1.2. Variance 76
1.13.2. Methods of Risk Management 77
1.14. Returns 78
1.14.1. Meaning of Return 78
1.14.2. Types of Return 78
1.14.2.1. Real Return and Nominal Return 78
1.14.2.2. Nominal Return 79
1.14.2.3. Historical/Past Return 80
1.14.2.4. Expected/Future Return 80
1.14.3. Components of Return 81
1.14.4. Measuring Return 81
1.14.4.1. Traditional Methods of Measurement 81
1.14.4.2. Modern Methods of Measurements 83
1.14.5. Relationship between Risk and Return 84
1.14.6. Risk Return Trade-Off 85
1.14.7. Portfolio Risk 86
1.14.8. Power of Diversification 86
1.15. Miscellaneous Problems 87
Module 2: Security Analysis and Valuation
2.1. Security Analysis 102
2.1.1. Introduction 102
2.2. Fundamental Analysis 103
2.2.1. Concept of Fundamental Analysis 103
2.2.2. Strengths of Fundamental Analysis 103
2.2.3. Weaknesses of Fundamental Analysis 104
2.2.4. Top-Down Approach/Economy-Industry-Company Approach 104
2.3. Economic Analysis 105
2.3.1. Introduction 105
2.3.2. Concept of Environment 106
2.3.3. Types of Economic Forecasting 108
2.3.4. Economy and Trade Cycles 108
2.3.5. Economic Forecasting Techniques 109
2.3.6. Factors Affecting Economic Forecasting 111
2.3.7. Significance of Economic Analysis 113
2.4. Industry Analysis 114
2.4.1. Introduction 114
2.4.2. Characteristics of Industry Analysis 114
2.4.3. Need for Industry Analysis 116
2.4.4. Classification of Industries 117
2.4.5. Factors Influencing Industry Analysis 118
2.4.6. Frameworks of Industry Analysis 119
2.4.6.1. Industry Life Cycle Stages (Product Life Cycle Theory) 119
2.4.6.2. SWOT Analysis of Industry 120
2.4.7. Industry Forecasting Methods 121
2.4.8. Problems of Industry 123
4. 2.5. Company Analysis 123
2.5.1. Introduction 123
2.5.2. Nature and Style of Management 124
2.5.3. Framework of Company Analysis 125
2.5.3.1. Financial Indicators 125
2.5.3.1.1. Ratio Analysis 126
2.5.3.1.2. Statement of Cashflows 128
2.5.3.2. Non-Financial Indicators 129
2.5.4. Sources of Information – Trouble Shots of Financial Statements 130
2.5.5. Company Forecasting Methods 132
2.6. Technical Analysis 135
2.6.1. Concept 135
2.6.2. Assumptions of Technical Analysis 135
2.6.3. Factors Considered in Technical Analysis 136
2.6.4. Criticisms of Technical Analysis 136
2.6.5. Distinctions between Fundamental and Technical Analysis 138
2.6.6. Superiority of Technical Analysis 138
2.6.7. Tools And Application of Technical Analysis 138
2.7. Price Indicators 139
2.7.1. Price Indicators of Market 139
2.7.1.1. Dow Theory 139
2.7.1.1.1. Criticisms of Dow Theory 143
2.7.1.2. Elliot Wave Theory 143
2.7.1.3. Breadth of Market 145
2.7.1.4. New Highs and New Lows 145
2.7.1.5. Market Sentiment Indicators 146
2.7.1.6. Confidence Indicator (Disparity Index) 146
2.7.1.7. Most Active List 147
2.7.2. Price Indicators of Individual Stock 147
2.7.2.1. Charting Techniques 147
2.7.2.2. Moving Average Analysis (MAA) 149
2.7.2.3. Relative Strength Analysis 151
2.8. Volume Indicators 151
2.8.1. Volume Indicators of Market 151
2.8.2. Volume Indicators of Individual Stock 152
2.9. Other Indicators of Market 154
2.10. Valuation 155
2.10.1. Introduction 155
2.10.2. Scope of Valuation 155
2.11. Valuation Of Preference Shares 156
2.12. Equity Valuation 157
2.13. Equity Valuation Models 157
2.13.1. Discounted Cash-flow Technique 158
2.13.1.1. Dividend Discount Models 158
2.13.1.1.1. Single-Period Valuation Model 159
2.13.1.1.2. Multi-Period Valuation Model 160
2.13.1.1.3. Zero Growth Model 160
2.13.1.1.4. Constant Growth Model (Gordon Model) 161
2.13.1.1.5. Two-Stage Growth Model 161
2.13.1.1.6. H-Model 164
5. 2.13.1.2. Present Value of Free Cashflow to Equity 165
2.13.1.3. Present Value of Operating Free Cashflow 167
2.13.2. Balance Sheet Valuation 168
2.13.3. Price-Earnings Ratios 169
2.13.4. Other Comparative Valuation Ratios 170
2.13.4.1. Price-Book (P/B) Ratio 170
2.13.4.2. Price-Sales (P/S) Ratio 171
2.14. Efficient Market Theory 172
2.14.1. Introduction 172
2.14.2. Meaning of Efficient Market Hypothesis 173
2.14.3. Assumptions of Efficient Market Hypothesis 174
2.14.4. Forms of Efficient Market Hypothesis 174
2.14.5. Random Walk Theory 175
2.14.5.1. Implications of Random Walk Theory 176
2.14.5.2. Limitations of Random Walk Theory 177
2.14.6. Empirical Tests 177
2.14.6.1. Empirical Tests of Weak Form 177
2.14.6.2. Empirical Tests of Semi-Strong Form 179
2.14.6.3. Empirical Tests of Strong Form 180
2.14.7. Implications of EMH for Investment Decisions 180
2.15. Behavioral Finance 182
2.15.1. Introduction 182
2.15.2. Biases in Behavioral Finance 182
2.15.3. Prospect Theory of Behavioral Finance 183
2.15.4. Behavioral Portfolios 184
2.16. Miscellaneous Problems 185
Module 3: Fixed-Income Securities and Derivatives
3.1. Bond/ Fixed Income Securities 191
3.1.1. Meaning of Bond/Fixed Income Instrument 191
3.1.2. Features of Bonds/Fixed Income Instruments 191
3.1.3. Types of Bonds/ Fixed Income Instrument 192
3.1.4. Investment Process in Bonds 195
3.1.5. Bond Risk 196
3.1.6. Bond Price 197
3.1.7. Reasons for Issuing Bonds 198
3.1.8. Valuation of Bond 199
3.1.9. Bond Yield 200
3.1.10. Bond Pricing Theorems 202
3.2. Structuring Terms/ Term Structure Of Interest Rates 204
3.2.1. Types of Term Structure of Interest Rates/ Yield Curve 205
3.2.2. Causes of Term Structure/Term Structure Finance 206
3.3. Duration 208
3.3.1. Properties of Duration 210
3.3.2. Determinants of Duration 211
3.3.3. Modified Duration 212
3.3.4. Convexity 214
3.3.5. Applications of Convexity and Duration 215
3.4. Derivatives 216
6. 3.4.1. Meaning and Definition of Derivatives 216
3.4.2. Features of Derivatives 216
3.4.3. Role/Functions of Derivatives 217
3.4.4. Types of Derivatives 219
3.4.5. Structure of Derivative Markets 220
3.4.5.1. Financial Derivatives Market 221
3.4.5.2. Commodities Futures Market 222
3.4.6. Participants in Derivatives Market 222
3.4.7. Valuation of Derivatives 222
3.4.8. Advantages of Derivatives 224
3.4.9. Disadvantages of Derivatives 224
3.5. Options 225
3.5.1. Meaning of Options 225
3.5.2. Option Terminology 226
3.5.3. Uses of Options 226
3.5.4. Types of Options 227
3.5.5. American Options & European Options 228
3.5.6. Options Strategies 229
3.5.6.1. Bullish Strategies 229
3.5.6.2. Bearish Strategies 235
3.5.6.3. Neutral Strategies 239
3.5.7. Options Trading 245
3.5.8. Options Pricing 247
3.5.8.1. Factors Determining Option Price 247
3.5.8.2. Pricing of Call Options at Expiration 249
3.5.8.3. Pricing of Put Options at Expiration 250
3.5.8.4. Pricing of Call Options before Expiration 250
3.5.8.5. Pricing of Put Options before Expiration 251
3.6. Option Valuation 253
3.6.1. Binomial Options Pricing Model 253
3.6.1.1. Assumptions of Binomial Options Pricing Model 253
3.6.1.2. Advantages of Binomial Option Pricing Model 254
3.6.1.3. Disadvantages of Binomial Option Pricing Model 254
3.6.1.4. Types of Binomial Option Pricing Model 254
3.6.1.5. Single Period Binomial Model 254
3.6.1.5.1. Binomial Option Pricing Model (BOPM) for Call 255
3.6.1.5.2. Binomial Option Pricing Model (BOPM) for Puts 258
3.6.1.6. Two-Period Binomial Model 259
3.6.2. Black-Scholes Option Pricing Model (BSOPM) 261
3.6.2.1. Assumptions of Black and Scholes Model 262
3.6.2.2. Advantage of Black & Scholes Model 263
3.6.2.3. Disadvantage of Black & Scholes Model 263
3.7. Futures 263
3.7.1. Meaning of Futures 263
3.7.2. Characteristics of Futures Contract/ Futures Terminology 264
3.7.3. Futures Market 265
3.7.4. Types of Futures 265
3.7.5. Trading of Futures 266
3.7.6. Strategies for Using Futures 267
3.7.7. Futures Pricing 270
7. 3.7.7.1. Pricing by Arbitrage 270
3.7.7.2. Cost-of-Carry Model 271
3.7.8. Advantages of Futures 273
3.7.9. Disadvantages of Futures 274
3.7.10. Difference between Futures and Options 274
3.8. Swaps 275
3.8.1. Introduction 275
3.8.2. Features of Swaps 275
3.8.3. Types of Swaps 276
3.8.4. Components of Swap Price 278
3.9. Miscellaneous Problems 279
Module 4: Portfolio Management
4.1. Portfolio Management 284
4.1.1. Meaning of Portfolio Management 284
4.1.2. Phases of Portfolio Management 284
4.1.3. Qualities of a Portfolio Manager (PM) 287
4.1.4. Types of Portfolio Management 288
4.1.5. Benefits of Portfolio Management 289
4.2. Portfolio Analysis 290
4.2.1. Meaning of Portfolio Theory 290
4.2.2. Portfolio Risk and Return 290
4.2.2.1. Expected Return on Portfolio 290
4.2.2.2. Portfolio Risk 291
4.2.3. Power of Diversification/ Reduction of Risk through 292
Diversification
4.2.4. Portfolio Risk in Two Asset Model 295
4.2.5. Portfolio Risk in n-Asset Model 295
4.3. Portfolio Construction 297
4.3.1. Inputs for Portfolio Construction 298
4.3.2. Inputs for Optimum Portfolio Construction 299
4.4. Portfolio Selection 299
4.4.1. Approaches in Portfolio Selection 300
4.4.1.1. Traditional Approach 300
4.4.1.2. Modern Approach 302
4.4.2. Factors Influencing Portfolio Selection 303
4.5. Markowitz Portfolio Theory 303
4.5.1. Assumptions of Markowitz Theory 304
4.5.2. Construction of Optimum Portfolio 307
4.5.3. Efficient Frontier/Portfolio 307
4.5.3.1. Feasible Frontier for Different Degrees of Correlation 308
4.5.3.2. Efficient Frontier for the n-Security Case 309
4.6. Single Index Model 310
4.6.1. Assumptions of Single Index Model 310
4.6.2. Uses of Single Index Model 311
4.7. Capital Market Theory 311
4.8. Capital Asset Pricing Model (CAPM) 311
4.8.1. Introduction 311
4.8.2. Assumptions of CAPM 313
8. 4.8.3. Shortcomings of CAPM 314
4.8.4. CML and SML 315
4.8.5. Capital Market Line (CML) 315
4.8.6. Security Market Line (SML) 316
4.8.7. Beta as a Measure of Risk 319
4.8.7.1. Calculation of Beta 320
4.9. Arbitrage Pricing Theory 321
4.9.1. Risk Factor in APT 321
4.9.2. Assumptions of APT 323
4.9.3. Factor Model 323
4.9.3.1. One-Factor Model 323
4.9.3.2. Two-Factor Model 324
4.9.3.3. Multifactor Arbitrage Pricing 325
4.9.4. Arbitrage 326
4.9.4.1. Principle of Arbitrage 326
4.9.5. Arbitrage Portfolios 327
4.9.5.1. Characteristics of Arbitrage Portfolio 327
4.9.6. Relationship of APT with the Capital Asset Pricing Model 328
4.10. Miscellaneous Problems 328
Module 5: Portfolio Evaluation and Revision
5.1. Portfolio Revision 335
5.1.1. Meaning of Portfolio Revision 335
5.1.2. Need for Revision 335
5.1.3. Constraints in Portfolio Revision 336
5.1.4. Portfolio Revision Strategy/Techniques 336
5.1.4.1. Active Revision Strategy 336
5.1.4.2. Passive Revision Strategy 337
5.1.5. Formula Plan 337
5.1.5.1. Assumptions of Formula Plan 338
5.1.5.2. Advantages of Formula Plan 338
5.1.5.3. Disadvantages of Formula Plan 338
5.1.5.4. Types of Formula Plan 339
5.1.5.5. Rupee Cost Averaging Plan 339
5.1.5.5.1. Advantages of Rupee Cost Averaging Plan 340
5.1.5.5.2. Disadvantages of Rupee Cost Averaging Plan 340
5.1.5.6. Constant Value Plan 340
5.1.5.6.1. Advantages of Constant Value Plan 341
5.1.5.6.2. Disadvantages of Constant Value Plan 341
5.1.5.7. Variable Ratio Plan 342
5.1.5.7.1. Advantage of Variable Ratio Plan 343
5.1.5.7.2. Disadvantages of Variable Ratio Plan 343
5.1.5.8. Dollar Cost Averaging Plan 343
5.2. Performance Evaluation Of Portfolio 344
5.2.1. Meaning of Portfolio Evaluation 344
5.2.2. Need for Evaluation 344
5.2.3. Evaluation of Mutual Funds 345
5.2.4. Sharpe’s Ratio 346
5.2.5. Treynor’s Measure 347
9. 5.2.6. Jensen Measure 347
5.2.7. Modigliani & Modigliani Measure (M2 Measure) 349
5.2.8. Fama Measure of Net Selectivity 350
5.2.9. Performance Measurement with Changing Portfolio Composition 351
5.2.10. Factors Affecting Use of Performance Measures 353
5.3. Mutual Funds 353
5.3.1. Meaning and Definition of Mutual Funds 353
5.3.2. Characteristics of Mutual Funds 355
5.3.3. Difference between Mutual Fund and Investment Companies 355
5.3.4. Mutual Funds Superiority vis-à-vis Other Investment Options 356
5.3.5. Types/Classification of Mutual Funds 356
5.3.5.1. General Classification 356
5.3.5.2. Broad Classification 357
5.3.6. Open-Ended Fund/Schemes 366
5.3.7. Close-Ended Fund/Schemes 366
5.3.8. Difference between Open-End and Close-End Fund/Schemes 366
5.3.9. Risks Associated with Mutual Funds 367
5.3.10. Choosing a Mutual Fund 368
5.3.11. Advantages of Mutual Funds 369
5.3.12. Disadvantages in Operation of Mutual Funds 371
5.3.13. SEBI Guidelines for Mutual Funds 373
5.3.14. Structure/Organization of Mutual Funds 374
5.4. Asset Management Company 377
5.4.1. Meaning of Asset Management Company 377
5.4.2. Functions of Asset Management Company 377
5.4.3. Structure of Asset Management Company 378
5.4.4. Restrictions for Asset Management Company 380
5.4.5. SEBI Guidelines on Asset Management Company (AMC) 380
5.5. Miscellaneous Problem 381