Financepro

Key Factors and Indicators to be considered before making Investment in Capital Market: Investors have a different mindset when they decide about investing in a particular avenue. Every individual wants his saving to be invested in the most secure and liquid way. However, the decision varies for every individual depending upon their risk aptitude. Investors shall look at the Fundamental  part of the company and bifurcate them into quantitative and qualitative  aspects before making an investment in the companies listed in the capital market. By the end of the blog, you will be able to know the basic terminology used in the capital market. Share : Total capital of the company is divided into units of small denomination. one of the units into which the capital of the company is divided is called a  Share . for example, in one company the total capital of Rs 7,00,000 is divided into 7,000 units of Rs 100 each then each unit of Rs 100 is called a  Share . Capital:  ...

  Profitability Ratio for shareholders: Return On Equity, Return On Capital Employed, Return On Assets, Operating profit, Gross Profit, and Net profit. Interpretations and analysis of profitability ratios. Dupont Analysis of Return On Equity and Return On Capital Employed. so, to calculate the return on equity using the Dupont model, simply multiply the three components that are net profit margin, asset turnover, and equity multiplier.  Table of content   Return On Equity(ROE)  Return On Capital Employed(ROCE)  Return On Assets (ROA) Gross Profit Ratio Operating  profit Ratio Net Profit Ratio conclusion 1) Return On Equity(ROE) This ratio calculates return on equity shareholder's fund only. It excludes preference shareholder's  funds. A  high return  on equity shows better productivity or efficiency in the utilization of the owner's funds. Return on equity is also called return on net worth. let us understand it by one example. suppose Coca-...