for questions related to understanding basic concepts in finance or certain terms in a particular context

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0
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0answers
32 views

Free float is expressed as percentage of shares issued or shares outstanding?

Quiet often, one sees the free float expressed as a percentage number, e.g. http://www.pse.com.ph/stockMarket/companyInfo.html?id=154&security=165&tab=0 The question is, is the free float ...
5
votes
4answers
999 views

What exactly is a “derivative”?

I haven't been able to find exactly what a derivative means. It seems to be some sort of cross of insurance, stock, and lay-a-way. When I try to look it up, all I find is all the problems not ...
2
votes
4answers
195 views

Why does ExxonMobil's balance sheet show more liabilities than assets?

In analyzing balance sheet of ExxonMobile, based off of Yahoo Finance report, we run into the following figures for the year: Current Assets: 51,647,000 Total Liabilities: 175,592,000 Now Current ...
2
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2answers
70 views

Liquidity Balance Sheet

Should be or should we not deduct long term debt along with current liabilities from total current assets to arrive at current asset value per share?
1
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1answer
157 views

What does it mean to borrow short and lend long?

What does it mean that institution borrowed short and lent long?it would be great if u may use a comprehensive example. Thank you very much.
5
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2answers
232 views

When is the right time to pay my credit?

I am confused on when is the right time to pay my credit. Here is what is written in the paper included with my card. Statement Date: 21st of the month Payment Due Date: 24 days after statement ...
2
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2answers
338 views

converting annual interest rate to monthly when compounding frequency known

Just like the title I'm looking for the formula to convert APR to monthly when I also know compounding frequency eg APR is 8% and being compounded daily what is the monthly interest rate I earn. Or ...
2
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2answers
165 views

First Home Purchase - Understanding Closing Costs

My loan officer earlier gave me an estimate of $11,485 towards closing cost, now when I applied for loan I see the estimate going up to $17,110. For example the Origination Fee Charge ...
3
votes
3answers
285 views

Can anyone help me understand my loan payment?

My loan was $40500 for five years with 9% interest per year. I do not understand the total I would have to pay. I have been paying 700 per month since 2006 and it feels like I've been paying forever. ...
0
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1answer
146 views

How soon in advance to cancel a credit card to avoid the annual fee?

Last year I applied for a credit card (Delta Gold Amex) in order to get 50K bonus miles with the first year annual fee waived. I'm about to cash in the miles and I have never paid a dime in interest. ...
0
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1answer
96 views

How To Interpret Share Prices?

During conversation shares in Google came up as a topic. Out of interest I Googled the share price for Google and was presented the following: Google Inc. (GOOG) -NasdaqGS 523.40 My ...
2
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3answers
2k views

If I was to buy something a day before my due date for my credit card bill, would I be charged interest?

First of all, I am a resident of Canada. I am sort of new to credit cards, so I hope my question makes sense. I've had my card for a few months ago and I've always payed the balance in full by the ...
2
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1answer
269 views

What does “issued XXX and YYY shares” mean?

I'm looking at a random company, Hain Celestial Group (HAIN). Their 10-Q from 2014-11-07 says on the first page: "As of November 3, 2014 there were 50,460,313 shares outstanding of the registrant’s ...
1
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1answer
89 views

How do parent companies collect/handle net income from their subsidiaries?

Say Company A purchased 100% of Company B, and in 2012 Company turned over a net income of $X Were Company B to be its own owner, the $X would go in their "pockets", their bank account. But seeing ...
6
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1answer
206 views

Why do futures traders write months in a strange way?

I was reading up a bit on futures and found that futures clearing merchants write months in a very unexpected way: Month Month Code January F February G March H April J May ...
-2
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1answer
84 views

What does bank do with “Repaid Principal”? [closed]

When a bank on its loaned amounts receives payments towards repayment of the principal, what does it do with this amount received by them as "Repaid Principal"? Does this amount received as "Repaid ...
0
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1answer
149 views

Is Bitcoin practical? How does Bitcoin actually work in real life? It's a good way to invest? Did you use it only for shopping? [Edit] [closed]

How can I use Bitcoin? Is it convenient to convert euros/currency to Bitcoin and use it for shopping? Or is it better to hold the Bitcoin hoping for it to become more valuable and reconvert some back ...
1
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0answers
244 views

Learnvest vs. Wealthfront: Advantages and disadvantages for a beginner investor

I am very beginner in terms of investing, financial planning and growing my money to save for the future. My objective is to be able to start covering those bases by getting education as well as find ...
0
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1answer
128 views

College student lacking investment experience: How to begin investing money? [closed]

I am right now a college student with very little experience investing. I have a little bit of money now that I am looking to invest to increase it. how should I go about this? I have access to stock ...
1
vote
1answer
237 views

What do the points in a stock market index epresent?

For instance after the GFC, the ASX All Ords fell to about 3200. It last closed at 5777.2 (http://www.asx.com.au/) But what do these points actually mean in terms of what they represent?
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2answers
96 views

Would the lender care about getting regular payments, or just their total interest? [closed]

What will be the banks or lending institutions be more interested in; Making interest on a loan in a uniform manner Simply netting the required amount of interest In the second case, it wouldn't ...
1
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2answers
108 views

New to stock market, need some help understanding 'Stock Last Price v Ask Price'?

I entered Investopedia's Simulator game and was looking to buy some shares of Netflix. This is the data at the time: Last Price 574.60 Ask Price 574.76 When I placed my market buy order of 100 ...
1
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1answer
61 views

Book Value vs Market Value of PWT.TO

I'm new to this forum, so please excuse if my formatting or something is wrong. Anyways, I had a question regarding stocks. The particular question is regarding PWT.TO; Penn West Petroleum Ltd. on ...
1
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2answers
96 views

Using simple moving average in Equity

I have read about simple moving average. However I am still not able to analyse on how to use it in equity(Stocks). I have read about many SMA, 5 day SMA, 10 day SMA and 200 day SMA. However want ...
3
votes
2answers
152 views

Can someone please help me understand Foreign Exchange Rates?

As an example, this page gives the following rates: AUD/USD: Bank buys (I want to receive/sell) - 0.882 Bank sells (I want to send/buy) - 0.7448 Does this mean that if I want to ...
0
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2answers
105 views

Is forward P/E calculated using current price(if yes, how useful is it)?

From my understanding, F1/F2 P/E is calculated using forward estimated EPS. And It seems to be impossible to predict future price (otherwise everyone just follow the Est. price) However, if it's ...
1
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1answer
118 views

should the Market Capitalization be equal to the Equity of the firm

I am new in finance and I was wondering the following probably stupid questions that I don't seem to find answer anywhere. When the owner of a firm decides to make its firm public should the Market ...
4
votes
5answers
674 views

Why do stocks go up? Is it due to companies performing well, or what else? [duplicate]

I searched for this question but I didn't get any convincing answer. What everyone says is that if a company does well (I assume this means the company has good returns on its projects) then people ...
4
votes
2answers
458 views

How are stocks in an IPO allocated to investors

Example: the VRL Logistics IPO was subscribed 74x, how is it decided who gets shares and who doesnt? This is assuming the number of those who applied at the highest price point is still greater than ...
2
votes
2answers
180 views

Market Cap lower than Shares Outstanding x Share Price?

Why would the market cap for a company be lower than its shares outstanding x share price? Example: Meggitt trades at 544 a share with shares outstanding of 801,960,000. Their market cap is 4.37 ...
3
votes
5answers
219 views

What does “interest rates”, without any further context, generically refer to?

There's an old Far Side cartoon where someone discovers a guy in a room full of telephones behind a door labeled 'They' and shouts something like "MORTIMER STANLEY! So you're the they in 'That's what ...
3
votes
1answer
57 views

How does a CFD work behind the scenes?

I'm curious as to how the Contracts For Difference (CFDs) work. I understand how they work for the consumer side - you enter into an agreement to pay/be paid the difference between the stock price at ...
2
votes
2answers
151 views

Good habits pertaining to personal finance for someone just getting started?

I'm in college right now. I'm in my 20s and will graduate next year. I haven't invested in any funds/stocks or anything of that sort. I am not working currently (part time or full time) — well, ...
2
votes
4answers
335 views

Building financial independence

In my very late 20s I am working hard to become financially independent. I have a good job paying between 74-80k a year. I can live (pay rent, food, entertainment) for $1k a month. So after taxes I ...
1
vote
1answer
59 views

What is an “RRSP deduction limit” for?

I'm not asking what my limit is—I can see what is the dollar amount of my deduction limit. Rather, I don't quite grasp what is an RRSP deduction limit for? Why is there a limit? A limit to ...
1
vote
1answer
52 views

What's the difference between a company's after-tax profit and their sales/revenue?

Two fundamental analysis formulas have got me confused. One is the EPS (earnings per share) and the other is P/S (price/sales ratio). If I understand the formulas correctly, EPS is calculated by ...
1
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4answers
295 views

What is the opposite of a sunk cost? A “sunk gain”?

Here's an example of the sunk cost fallacy: You decided to buy a solar panel because you heard that you can make money from them over time. Unfortunately, you didn't do enough research and bought an ...
25
votes
11answers
6k views

Will a credit card issuer cancel an account if it never incurs interest?

I have a few credit cards that are currently carrying some larger "promotional" balances. These are purchases that I decided to put on a 6, 12, or 18 month 0% APR financing offer vs. taking any points ...
1
vote
1answer
421 views

How does a company get money by going public in an IPO?

If a company goes public, how does it get the money? Will the underwriter pay the company once it goes for initial public offering (IPO)? Does that have anything to do with the valuation? Say a ...
1
vote
1answer
47 views

Online resources for understanding credit reports, including a sample?

Could someone provide me sources where I can find some examples of a credit report (in the USA), how it looks like, etc.? I want to understand each and every section of credit report. Any ...
2
votes
4answers
1k views

What's the difference between Market Cap and NAV?

Here's my understanding: Market Captilisation is the market value of all of a company's shares. Then this sounds like the market value of a company's equity. NAV is Asset minus Liabilities. Wouldn't ...
1
vote
2answers
154 views

Given advice “buy term insurance and invest the rest”, how should one “invest the rest”?

It is often recommended that people buy term insurance for a lower premium cost, and invest the rest of the money. It is said that the returns from your own investment are higher than the ones from ...
2
votes
1answer
147 views

Formal Definition of APR

I have seen several conflicting sources on the internet about APR. Some say the effective rate is (1+APR/n)^n -1 while others say this formula is the APR since APR represents the rate over all ...
0
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1answer
73 views

Financial times vs free news

I am a student living in the UK and I am trying to improve my 'commercial awareness' for applying to finance related jobs. (In particular algorithmic trading) What advantages, if any, does reading ...
0
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1answer
58 views

calculating no. of payments

is there a formula to calculate the no. of payments "P" required to pay off a loan amount "X", with an interest rate "Y" and a monthly payment amount "Z". I think "X/Z" would be an approximation for ...
2
votes
1answer
217 views

What is the rationale for a separate “National Insurance” tax in the UK?

In the UK there's a type of income tax called "National Insurance", similar to regular income tax. http://www.hmrc.gov.uk/ni/ What is the rationale for having this separate income tax? How does it ...
4
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2answers
2k views

401k Hardship withdrawal (First home), without buying home?

Not saying this is a good idea, but honestly it was something I was just curious about. My and other 401(k) plans allows you to withdraw from your 401(k) before 59 years of age for "hardship" for the ...
31
votes
5answers
5k views

What are the economic benefits of owning a home in the United States?

I am trying to figure out if owning a home is more economical then renting. According to all the tools, according to the rent I pay now (< $800) owning a home is not economical, even in the long ...
-1
votes
1answer
212 views

Lump sum investment vs SIP when I have the lump sum

I am fresh out of college and placed with a good job. It's been two months now and I have with me (after making all deductions): Two months salary Signing bonus = Equivalent to another 1.5 months of ...
6
votes
1answer
563 views

I own a mutual fund that owns voting shares, who gets the vote?

I was looking at FSCSX and noticed that it owns some Google Class A shares. These shares get 1 vote each (Yeah I know Google voting shares cant really influence anything, lets ignore that). Who ...