Discy Latest Questions

  1. Yes Rayon, swaps are indeed OTC(over-the-counter). They are customized contracts traded in the over-the-counter market privately, versus options and futures traded on a public exchange. Basically, firms and financial institutions dominate the swaps market, with few individuals that rarely participatRead more

    Yes Rayon, swaps are indeed OTC(over-the-counter). They are customized contracts traded in the over-the-counter market privately, versus options and futures traded on a public exchange. Basically, firms and financial institutions dominate the swaps market, with few individuals that rarely participating. Since, swaps occur on the OTC market, there is always the risk of a counter party defaulting on the swap.

    See less
    • 0

  1. Swapping is the process of creating a contract through which two parties exchange the cash flows or liabilities from two different financial instruments. Generally swapping involve cash flows based on a notional principal amount such as a loan or bond, although the instrument can be almost anything.Read more

    Swapping is the process of creating a contract through which two parties exchange the cash flows or liabilities from two different financial instruments. Generally swapping involve cash flows based on a notional principal amount such as a loan or bond, although the instrument can be almost anything. Although, the principal does not change hands. Each cash flow comprises one leg of the swap. One cash flow is generally fixed, while the other is variable and based on a benchmark interest rate, floating currency exchange rate or index price.

    See less
    • 0

  1. An answer to that is both yes and no. Suffice to say, sometimes they could be paid more and sometimes less. It depends upon what type of work you are doing if you are an online blogger or developer chances are you could be making more money. Although technically they should be paid less as they don'Read more

    An answer to that is both yes and no. Suffice to say, sometimes they could be paid more and sometimes less. It depends upon what type of work you are doing if you are an online blogger or developer chances are you could be making more money. Although technically they should be paid less as they don’t have to waste their money and efforts on transportation and setting up a traditional work environment.

    See less
    • 0

  1. As we know that a corporate raider is an investor who buys a large interest in a corporation whose assets have been judged to be undervalued with the goal to affect profitable change in the company's share price. Let’s work through an example of how do they do it. So, firstly an investor uses a stocRead more

    As we know that a corporate raider is an investor who buys a large interest in a corporation whose assets have been judged to be undervalued with the goal to affect profitable change in the company’s share price. Let’s work through an example of how do they do it. So, firstly an investor uses a stock screener and identifies a company whose market value is trading significantly below its book value. Then in determining the rationale for the low market value of the company, the investor finds that its historical profitability ratios are comparable to competitors, but that the company’s management demonstrates a poor track record in sourcing deals to grow the business. As such, the investor acquires a majority interest in the company by purchasing shares on the open market. At the company’s annual general meeting, the investor votes out the current management team and reconstitutes the management team with seasoned veterans. On this news, the company’s share price skyrockets and that is how he mints money.

    See less
    • 0

  1. In business, a corporate raid is the mechanism of buying a large stake in a corporation to make profit and then using shareholder voting rights to require the company to undertake novel measures designed to increase the share value, generally in opposition to the desires and practices of the corporaRead more

    In business, a corporate raid is the mechanism of buying a large stake in a corporation to make profit and then using shareholder voting rights to require the company to undertake novel measures designed to increase the share value, generally in opposition to the desires and practices of the corporation’s current management. It involves a corporate raider, who is an investor that buys a large number of shares in a corporation whose assets comes out to be undervalued. The large share purchase would permit the corporate raider significant voting rights, which could then be used to bring some changes in the company’s leadership and management. So basically raiding generally occurs when the company’s share price has recently fallen significantly. It is also called venture arbitrage.

    See less
    • 0

  1. According to a definition on Wikipedia, "The effective interest rate, effective annual interest rate, annual equivalent rate or simply effective rate is the interest rate on a loan or financial product restated from the nominal interest rate and expressed as the equivalent interest rate if compoundRead more

    According to a definition on Wikipedia, “The effective interest rate, effective annual interest rate, annual equivalent rate or simply effective rate is the interest rate on a loan or financial product restated from the nominal interest rate and expressed as the equivalent interest rate if compound interest was payable annually in arrears.”
    Simply speaking we can say that, Annual Equivalent Rate or AER is the real or actual interest rate that an investor would manifest at the end of the year for his shares and bonds or loans. It could also be noted that the AER will be higher than the stated interest rate.

    See less
    • 0

  1. According to the definition on Wikipedia, "Insider trading is the trading of a public company's stock or other securities based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal." Broadly speaking, every companyRead more

    According to the definition on Wikipedia, “Insider trading is the trading of a public company’s stock or other securities based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal.” Broadly speaking, every company has its own private information on its working, planning, financing, marketing etc. This information is although not as private and safe as it might seem. Since employees who work in that organization has most of this information as they are trusted with it. When employees secretively leak this information, or we can say when an insider trade this information for his or her own profit then it is known as insider trading.

    See less
    • 0