Primary security refers to the main asset the borrower provides to secure and safeguard the lender for the loan. It serves as the primary source of repayment in case of default.
Collateral security acts as a secondary security, supplementing the primary security to mitigate/reduce the lender’s risk further.
Having the right and accurate financial information can be a game changer element in your personal as well as professional life, it not only helps individuals master their personal financial objectives but also helps them to be better capital allocators, financial controllers, financial managers, entrepreneurs, company owners.
Building a great and effective business needs a strategic framework and an excellent execution system on a consistent and continuous basis.
Finance is such a powerful medium that, it performs an important role to operate, co-ordinate and control the various economic activities of the business enterprise.
Finance is essential for expansion, diversification, modernization, as well as for establishment of new projects.
The financial manager is a person who is a professional/expert in the field of finance and looks after the fiscal affairs and financial health of the business organisation.
He/she is responsible for the various financial transactions, decisions, deployment of cash, return on investment (ROI), cash inflows and outflows.
Goodwill plays an important role in strengthening the fundamentals and overall image of the business organisation, it is an intangible asset but not a fictitious asset which means that it has some realisable value.
By understanding various financial terms and the mechanism in which it functions, one can reach great heights. Finance is a vast subject with several branches.
Capital rationing is a situation, whereby, the funds available for completing a project are limited.
It is a situation where a constraint or budget ceiling is put in place on to the total size of capital expenditure under the assumption that the availability of financial resources is quite limited.
It is a financial strategy used by companies or financial institutions or investors to limit the number of projects to be taken up at a time. If there is a pool of available investments which are expected to be profitable, the strategy of capital rationing provides the investors with the most profitable one to choose from.
The abbreviation SIP stands for Systematic Investment Plan, this is a type of investment which helps the investors save and grow the investors’ money over a period of time. SIP helps investors to invest small amounts of money on the regular basis instead of investing a large sum of money all at once. SIP primarily gives the benefit of the term Rupee Cost Averaging. SIP works on the foundation of this approach of Rupee Cost Averaging. Investing in SIP provides with the benefit of averaging out the costs of the investments without having to worry about the market conditions.
By understanding various financial terms and the mechanism in which it functions, one can reach great heights. Finance is a vast subject with several branches.
Debt mutual funds are those funds which primarily invest in debt instruments such as bonds, debentures, certificates of deposits, etc.
This is a category of mutual fund that primarily invest in fixed-income securities, such as corporate and government bonds, treasury bills, and money market instruments. They are also known as income funds or bond funds. Investment in debt mutual funds is ideal for investors who are not willing to take up major risks but want safety of capital along with a stable return on their investment.
Mutual fund refers to a large pool of money invested in proportions, in the stock exchange by sound professional expert known as the finance manager.
Mutual funds are ideal for investors who either lack large sums for investment, or for those who do not have the time to research the market, yet want to grow their wealth. The money collected in mutual funds is invested by professional fund managers according to the scheme’s stated objective.