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What is Bull Market ? |
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A bull market refers to an extended period
of general price increases in the securities
market. |
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What is a Bear Market ? |
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A bear market refers to an extended period
of general price decreases in the securities
market. |
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What is Going Long ? |
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Going long means purchasing an investment
that will appreciate in value when the investment
goes up in price. Being long is also referred
to as being bullish on the market. |
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What is a Reward/Risk Ratio ? |
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The ratio, often called the "Upside/Downside
Ratio", measures the amount of risk (decrease
of your capital) as compared to the reward
(increase in your capital). |
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For our purposes, it is calculated by dividing
your average annual rate of return by largest
peak-to-valley draw down, (30% 10% = 3 or
3 to 1). Another way of saying this is that
for every Rupee you risk, your reward will
be 3. Your minimum objective for any system
you evaluate should be no less than 2. |
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What is a Round Trip Trade? |
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A round trip trade describes a trade that
includes both the purchase and sale of a security.
In other words, a round trip trade would include
two transactions. |
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What is Beta ? |
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Beta is what financial experts use to measure
the up and down movement in an investments
such as a mutual fund. By definition, the
market has a beta of 1.00. A mutual fund with
a beta higher than 1.00 is predicted to move
up and down more than the market itself moves
and vice versa. For example a fund with a
beta of 1.15 is expected to increase or decrease
15 percent more or less than the market. |
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What is the Uptick rule? |
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The uptick rule dictates that you can only
sell short on an uptick. You can execute a
market order to short sell a stock on an uptick
or place a limit order one point above the
bid without violating the uptick rule. |
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Financial Planning |
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Financial Planning is the process of meeting
your life's responsibilities and realizing
your goals through proper management of finances. |
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Life goals can include leading
a decent life-style, buying a house, saving
for children's higher education and marriage,
planning for retirement etc. Your quality
of life depends on how well you plan your
finances. |
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If you start financial planning
at an early stage, it is more convenient and
cheaper since payments of installment for
various risk-protection-cum-insurance-cum-tax
saving investment schemes, get reduced.
A life without financial planning is like
going to a new city without a road map. |
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