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Investing in Gold (I)
I will not be the first, and probably also will not be the last, who spoke about the Gold Rush that shakes down the world for the last few years. Just in this time it is a little different than in the days when desired f
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Investing in Gold (II)
The upper limit of the price is even more difficult. In our times gold is not founded in streams as was shown in the movies. Now gold is mined from the deep earth and separated from gold dust, metal ore or rock. In natur
http://www.investingforbeginners.eu/investing_in_gold_ii-p0-i5
Investing in Uncertain Period
Investing always has some uncertainty, but there are some situations when rise even more questions than usually. The current situation is just like one of those uncertain periods. When the economic cycle so inconclusive,
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Investing in Russia
Investing in Russia has gotten really widely promoted for the last period. I can remember the talks that stocks in Russia are the cheapest over the world for not less than year. The fact, that those stocks are st
http://www.investingforbeginners.eu/investing_in_russia-p0-i9
Investment in Bulgaria
Starting from the very beginning I will try to make clear why I am bullish about investing Bulgarian stock market. At first I would suggest to look at the chart below. Five year Bulgarian stock market in
http://www.investingforbeginners.eu/investment_in_bulgaria-p0-i10
What to Do With investments in Current Turbulence?
The question is really not an easy one. The problem is that there is no left any good investments on this world. Let’s looks at the most topical investments classes: Stocks. Even before
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Investing in Land - Agricultural REITs
Investing in land I have noticed an increased interest in agricultural land investments during the last period. And I can it understand completely. When stocks are so volatile and bonds may offer such low return
http://www.investingforbeginners.eu/investing_in_land_agricultural_reits-p0-i12
US Debt Relief
Let me give you few facts at first that we would now what are we talking about: The General government gross debt in percent of GDP in the United States was reported at 83.21 percent of GDP in 2009 (90% of GDP
http://www.investingforbeginners.eu/us_debt_relief-p0-i13
Where Are the Investment Markets Moving Now?
Some of the market participants call the current situation a “crisis” others are starting to be convinced that we are in a bear market. While others just don’t know how to call it. Well, I call
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Stocks Riskier than Bonds?
It is so common that stocks are riskier investments than bonds; nobody is even considering this question. Would I doubt it? Of course not, stocks are stocks and bonds are bonds. But I would like to look at it fro
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Foundation of the Europes Financial Market
The key question in Europe now is how European Union will look after few years from now. This question is the most important at these days for all the Europe and may have affect to the entire world.
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Bond Investment: Government Bonds and Corporate Bonds
Corporate Bonds and Government Bonds Today I want to discuss another untraditional topic. However, this topic concerns the most traditional investments – bonds. Bonds been used for very long time a
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How ECB Is Affecting Investment Markets?
Today was announced very interesting news. The news is about the fact that ECB (European Central Banks) lends 489 billion of Euros to the banks. It is a really huge amount of capital that flows from ECB to the fi
http://www.investingforbeginners.eu/how_ecb_is_affecting_investment_markets-p0-i18
Problems in Greece: Is It Going to End?
Greece sounds like a curse for all investors and all other participants of the financial market. Yes, it is a small country compared to the global or European economy by the size of a GDP or other economical indi
http://www.investingforbeginners.eu/problems_in_greece_is_it_going_to_end-p0-i19
How to Beat the Stock Market
Investing is good, but the real challenge for every portfolio manager is to beat the stock market, or beat the market. Of course the term ‘market’ is not very exact. In reality to beat the market is t
http://www.investingforbeginners.eu/how_to_beat_the_stock_market-p0-i20
European Dividend Stocks
Before getting to the exact stocks, at first, please let me explain why I have chosen European dividend stocks as a topic. For the beginning, lets solve the question why dividend stocks. The true is that many inv
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What means long term in investing?
When I talk to non-professional investors, I often get surprised on their interpretation of ‘long-term investment’. Of course, everyone wants to enjoy their lives and to do it fast, while not many are ready t
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Is the Bubble of Commodities Going Down?
It can be said that commodity bubble already went down. The prices of the most commodities have slumped significantly during several last months. But was there really a bubble? Yes, the prices have
http://www.investingforbeginners.eu/is_the_bubble_of_commodities_going_down-p0-i24
How Oil Price Influence Investment Markets?
After Saudi and Russia decisions to increase supply oil has smashed to the unseen levels. But, what's next? Everything revolves around oil and it's inevitable that the fluctuations in the oil industry will
http://www.investingforbeginners.eu/how_oil_price_influence_investment_markets-p0-i31
How Investment Horizon Affects Your Investment Portfolio?
All investors have an investment horizon, which is the amount of time that they're willing to keep their money on the market. In layman's terms, it measures how long one is willing to wait before selling one's securiti
http://www.investingforbeginners.eu/how_investment_horizon_affects_your_investment_portfolio-p0-i32
Tips to let small business investments take off
Studies show that small business investments peter out or fall by the wayside within the first two to three years after the owners have started investing and operating. Lack of planning, management skill, or tech
http://www.investingforbeginners.eu/tips_to_let_small_business_investments_take_off-p0-i33
BRIC Countries
BRIC countries are the largest emerging economies over the world. The first letters of every country make a name of B R I C and those countries are: Brazil (population - 192m) Russia (population - 143m) Indi
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Investments
(Are you looking for investment definition?) investments are instruments that allow us to receive a higher amount of money than was spent. If someone spends 10 euros or dollars and he knows that he will receive
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Interest Coverage Ratio
Interest coverage ratio shows company’s ability to pay interests for its financial debts. Interest coverage ratio is a ratio between operating profit (EBIT to be more exact) and expenses for interests. The
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Investing
Investing - what is that exactly? Probably you have heard many different definitions of investing. However, what is the essence of it? The essence is very simple: investing - a present sacrifice for the future.If
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Derivatives
Derivative Financial Instruments Derivatives are so called because they are constructed from other traditional securities, and operate the rights to them. Apart from the fact that there are some basic derivative instrum
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Investing 10 NOT
INVESTING 10 things that you should try NOT to do: Do not let the emotions to take over control. The investment market is always full of emotions. It is very important to maintain sanity and
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Investment in Stocks
Stocks (shares) are investments that attract the most attention in financial markets, and perhaps stocks are worth it, because investors can expect the highest return from stocks among the range of traditional investme
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Investing for Retirement
Investing for retirement may be one of the most reasonable investment objectives. Sometimes, people invest so they can afford expensive things that they otherwise could not afford without investing. For example
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Investment in Cash
Bank (saving) Accounts, Deposits, Deposit Certificates, Treasure Bills, Money Market Funds When we are talking about investment, cash is not only the real paper (or metal) money that are held in the wallet or under the
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Investment in Mutual Funds
Investment Funds (Collective Investment) Investment in mutual funds is one of the most popular types of investment. A mutual fund is just a large and well diversified investment portfolio of many securities, in which ca
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Investment in Commodities
Investment in Oil, gold, Silver, Copper, Wheat Commodities (raw materials) are indeed a tangible asset class, but it can be also assigned to financial investments, because in current days most investments in commo
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Asset Management
Definition Asset management which also is called as investment management has many similarities to finance management but investment management is more specific and narrow area of finance. Invest
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Non-Financial Investments
When talks go about investing and investments everybody focuses on financial investments forgetting that spectrum of investments is much broader. Investment in non-financial investments is also popular, especiall
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Terminal Value
Terminal value is a value of the business (or other asset) used in discounted cash flow (DCF) method that is added after the discontinuing of the cash flow forecasting. DCF valuation is based on the sum
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Investment in Collectibles
Many kinds of collectibles may also be considered as investments, but their value and benefits are much more elusive, than more serious traditional investment instruments. Works of art, stamps, antiques, coins,
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Investing in Commodities Directly
Investment in Oil, Gold, Silver Directly Commodities has been already described as financial investment. It was assigned to financial investments because investors are investing in commodities not directly but w
http://www.investingforbeginners.eu/investing_in_commodities_directly
Direct Investment
Investment in Tangible Assets Direct investment are very wide issue to study, but it‘s not so close to traditional investing. Direct investments are more related with business development and would depend
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Investing in Funds
Investment Funds Strategy Indeed, investing in mutual funds is not complete investment strategy, but only a part of it, or more precisely, only the choice of investment instrument. For example, if the strategy d
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Investment Objectives for Beginners
The full investment objectives for beginners are very individual parameters. They were already mentioned briefly in article about benefits of investment. However, the basic investment objective is one - to make capital w
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Finance Management
Financial management, asset management, investment management, wealth management in fact are similar processes only called in different names. An investments definition may include both financial assets and real
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Investment Strategy by Age
It is very popular to allocate asset classes in investment portfolio according to investor’s age. And it has some reasonable justification: when investor’s age is changing – his risk tolerance a
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Investment Book:
Investing for Beginners Exposed: Or What Investment Consultants Hide from You Rokas Lukosius (Author of the book and this website) No matter whether you are a seasoned inv
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Investment Securities
Investment securities may have different understandings as a term, but most commonly investment securities are securities held on investment purpose to get a return from invested capital over mid-long term.
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investments in Ultra ETF
Ultra ETF by most characteristics is similar to normal ETF but there is one main difference: if Ultra ETF follows the same index as normal ETF does, it makes it twice. For example, if normal ETF follows index tha
http://www.investingforbeginners.eu/investments_in_ultra_etf
Investment in Short ETF
Investment in Short ETF is very different from regular investing. “Short” – means short selling transactions when securities are loaned and sold with obligation to return it after some pre-agree
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Investment Definition
Investment definition may have two meanings: 1) An investment as a process (investing) when tangible or financial assets are acquired on purpose to earn more money (or other material benefits) than was s
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Bond Market
A bond market includes all the bonds (debt securities) that are issued and traded or just held. Bond market is a part of a whole financial market. This market covers all the fixed income securities that are
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Bear Market
A bear market is a market trend when investment market is decreasing over longer period and is believed to decrease in the future. Bear market is a well known term in the investment world and is opposite to bull
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Investor
An investor is an individual or corporate unit that invests in any class of investments on purpose to earn some return from invested capital. There may be more criteria to distinguish very small investments
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Share Investor
A share investor is an investor who invests in shares (stocks) but not the other investments. If investor invests in different asset classes he is a regular investor. If investor is specializing in shares he must
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Stock Exchange
A stock exchange is an operator/company that takes bids from the sellers and buyers and executes transactions if conditions allow it. Usually stock exchanges offer trading not only for stocks but also for other f
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Investment Portfolio
An investment portfolio is a composition of different investments made on purpose to achieve the highest return at predetermined risk level. Investment portfolio can include all kinds of investments: stocks,
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Market Timing
Market timing is investor's actions when investments are switched between asset classes and may be a part of investment strategy. For example, if investor sees that stocks are very high and economical downturn is
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Global Investment
Global investment is investment that includes investments from different world’s regions. Investment can be local, regional or global. Local investment would focus on one country or state market, when regio
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International Investment
International investment is investment that includes investments from different countries. If investor acquires investments in several countries, we could call him international investor. If investment portfolio
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Diversified Investments
Diversified investments are investments that are well diversified, which should include regional diversification, allocation between asset classes, sectors, maturity, denomination of currencies and other characte
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Buying on Margin
Buying on Margin Costs of Buying Stocks on Margin Margin Call The Pros and Cons Psychology: Is it worth? Buying on margin gets popularity during every strong bull market. Unfortunately, it be
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Diversification
A diversification is an investment technique or a part of an investment strategy, which is used to reduce the investment risk of the portfolio, including in it larger number of different securities or other inves
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Pioneer Investments
Pioneer investments is an US investment company that main business is investment management. Now Pioneer investments is a worldwide company, but its activity is mostly exposed to Italy, because it was acquired by
http://www.investingforbeginners.eu/pioneer_investments
Capital Investment Group
Capital investment group is an organization that can have many juridical forms. Usually capital investment group is privately held or public organization, that invests in stakes of non-listed companies, real esta
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Real Estate Investment Group
Real estate investment group is mostly similar to the capital investment group. The main difference is that real estate investment group concentrates its investments on real estate property, when capital investme
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Private Equity Fund
A private equity fund is a fund that invests in a stakes of non-listed companies (private equity). Investment in private equity funds is much different from investment in mutual funds. They are illiquid, riskier
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Institutional Investment
Institutional investment is an investment that is made by an organization/institution. Usually, institutional investments are large scale and has important role in financial markets. Most institutional investment
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Institutional Investor
An institutional investor is an investor that is a corporation/institution. Institutional investors have high impact to investment markets and sometimes decisions of most known institutional investment manag
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Retail Investor
A retail investor is a small investor, which normally is an individual. Most of the investors in financial markets are retail investors, but retail investor makes an investments in much smaller amounts than
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Blue Chip Stocks
Blue chip stocks are stocks of the biggest large cap companies. Blue chip stocks usually are safer than average investment in stocks, have stable cash flow and pay stable dividends according dividend policy. Blue
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Hedge (Hedging)
Hedge (hedging) is protection of investment portfolio against fluctuations using financial instruments. Hedge is very popular at investment theory, but not so popular at investment practice. In theory everything
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Brokerage Company
A Brokerage Company is a financial institution that has a license to provide intermediary services for a securities trading to the clients. Every retail client cannot by securities on stock exchange by himself be
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Sole Proprietorship
A sole proprietorship is form of business that is owned by one individual. The main advantage of the sole proprietorship is the simplicity of starting business in this form. No weighty investments are needed. The
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Money Market
A money market is the market, in which money market investments are traded. Such money market investments can be deposits certificates, bills or other short term high grade fixed income securities.
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Capital Markets
Capital markets are the markets, in which stocks and medium to long term bonds are traded. Could be said that capital markets include stock markets and bond markets and are a part of financial markets. C
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Primary Markets
Primary markets are the markets, in which new capital investments are raised. The perfect example of primary market is an IPO, but even if it is not the first issue of securities for the company, it still counts
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Secondary Markets
Secondary markets are markets, in which securities are traded, but not acquired directly from the issuers. This is why secondary markets differ from primary markets, where securities are bought directly from issu
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Junk Bonds
Junk bonds are bonds that have a speculative-grade credit rating, which is BB or lower. Junk bonds are riskier but they have higher yields. The spread between junk bond yield and safe bond yield (c
http://www.investingforbeginners.eu/junk_bonds
Penny Stocks
Penny stocks used to be described as stocks which price on stock exchange are lower than 1$ or 5$ (there is no officially approved norm). However, it is not very fair to judge a company for its share price on exc
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Dividend Growth Stocks
Dividend growth stocks are stocks that are hard to find in reality. Because the stock must be either value stock (large dividend payments) either growth stock (small dividend payments) or either something in betw
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Value Penny Stocks
Value penny stocks are stocks that have characteristics of both: value stock and penny stock. Investment in value penny stocks isn’t very popular, because stock investors who seek for safety invest in norma
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Investment Market
An investment market is a part of a financial market and represents all investments that were issued by corporations, governments or other entities. All the trades made by retail and institutional investors can b
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Operating Leverage
An operating leverage is a company’s EBIT (earnings before taxes and financial operations) sensitivity to changes of sales. As the sensitivity is measured to operating income (close to EBIT), the
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Investment Growth
An investment growth may have two different meanings: Most probable it refers to growth investing. It is an investment strategy or part of it, which concentrates on investments in stocks that grow faster than
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Direct investments in Stocks
Direct investments in stocks are investments made without financial intermediaries (only theoretically). It means an investor buys stock directly from the company without intermediation of stock exchange or broke
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Investment Management Fees
Investment management fees (fees that are paid straight to investment manager) basically are one of these types: Performance based fee. Performance based fee is calculated according to increase of inve
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INVESTMENT MANAGEMENT HOW TO MANAGE YOURS investments PROPERLY
Investment management is a complete science and if you are expecting to become a professional investment manager in few hours you should get disappointed. However, there are several most important guidelines at i
http://www.investingforbeginners.eu/investment_management_how_to_manage_yours_investments_properly
Treynor Ratio
Treynor ratio is another popular ratio that is used to measure the performance of investment portfolio. This ratio compares the excess return (above risk free return) of a portfolio to beta of that portfolio. Whi
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Investment Risk Management
There are several main methods of investment risk management: Diversification. Diversification is the easiest and most of the times the cheapest way to reduce risk level of the investment portfol
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Quantitative Investment Management
Quantitative investment management says, “Don’t worry about investment management, and let to do the job for the computer”. It is a completely different approach compared to ‘value d
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Working Investment
Working investment mostly refers to working capital, which is equal to current assets less current liabilities. The other meaning of working investments might be that those are investments that are
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Foreign Direct Investment
Foreign direct investment (FDI) traditionally was understood as investment that is made by foreign country in direct assets, for example factory, including land, building and machinery. When financial markets evo
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Inflation
Inflation is a percent that reflects a price increase of goods and services portfolio. When inflation occurs, money is losing its purchasing power. For example, if inflation would keep at 8% for 9 years (it would
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Hyperinflation
Hyperinflation is an economical situation when inflation is extremely high. Regularly it is a result of inflation spiral and some disasters (as war), and is very dangerous for the economy. Just try imagine your b
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Deflation
Deflation is a process opposite to inflation and occurs when inflation is negative. Deflation means that prices of goods and services are decreasing. Such situation when prices are decreasing is not very common i
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Stagflation
Stagflation is an economical situation, when high inflation and stagnation of the economy come together. It is very difficult situation, because it not allows using monetary politics efficiently to revitalize the
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P/E Ratio
P/E ratio is the most popular valuation multiple that is used for stock analysis. This ratio shows the price of the stock compared to its earnings. The multiple is so popular because of its simplicity and im
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DCF Valuation
Discounted Cash Flow Analysis DCF valuation might be applied to any asset that generates positive free cash flow or is expected to generate that cash flow in the future. DCF valuation might be directly applied t
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Correlation
Correlation is a statistical measure that shows the relationship between two objects. Correlation may range between +1 and -1. If correlation between the objects is 0 that means they are not dependable on each ot
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Discounted Cash Flow
Discounted cash flow (DCF) is forecasted net cash flow of the company or other asset that is recalculated (discounted) to its current value. Discounted cash flow is important for investment assessing and mostly i
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Depository Receipts
Depository receipts are certificates that makes easier to invest in foreign stocks. Depository receipts lowers administration costs for foreign investment and makes foreign investments more trustful for local inv
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EBITDA Coverage Ratio
EBITDA coverage ratio (also called EBITDA to Interest Coverage Ratio) shows company’s capability to deal with its financial leverage. If this ratio is too low, that may show company is in trouble and may ha
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ROE
ROE (Return on Equity) shows profitability of company’s book value. Company’s book value (equity) is equal to company’s assets less liabilities, and ROE is usually higher if company ha
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ROA
ROA (Return on Assets) shows what profits are earned by company’s assets. Of course, assets alone usually do not earn the profit, because most of the times profit is the result of know-how and hard work of
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The Pros and Cons of Buying on Margin
Buying on Margin Costs of Buying Stocks on Margin Margin Call The Pros and Cons of Buying on Margin Psychology of Buying on Margin: Is it worth? The opportunity provided by buying on margin i
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Financial Investment
Financial investment is any financial asset that should provide a return for investor. Financial asset is an asset that doesn’t have tangible form and has some financial obligations to its owner. All securi
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Bearish
Bearish is attitude of an investor if investor expects market to go down in the near future. Most often term bearish is applied for stock investments when is believed that stocks are going to decrease in value. T
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Bullish
Bullish is an investor's attitude when he believes that the investment market is going to rise in the near future. Most of the times this term is applied for investments in stocks, when is believed that stock mar
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Investment Products
Investment products basically are investments that are packed and adopted for every investor. The best example of investment product could be mutual funds or any other investment funds that are well diversified a
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Pig (investor)
A pig is an animal known by every farmer. However, at investing pigs are also popular yet the meaning is different. In investment world are two kinds of animals mentioned the most: bulls and bears. Bulli
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Risk Tolerance
Risk tolerance is a characteristic that describes the investor and his ability to withstand losses from investments. The higher risk tolerance of investor the more losses he/she may handle. Investm
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Risk Averse
Risk averse is a characteristic of an investor who is avoiding risk. The more investor is avoiding the risk the more is he risk averse. Almost all the investors (as people are too) are more or less risk averse an
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Growth Funds
Growth funds are investment (mutual) funds that concentrate on investing in stocks of fast growing companies. Growth funds can be passively managed or actively-managed funds but all growth funds are riskier than
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Fund Manager
A fund manager is an employee of investment management company which is responsible for the management of the fund’s assets. Most of the times, more than one person is involved in fund’s management bu
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Balanced Fund
A balanced fund is a mutual (investment) fund that invests in different asset classes: stocks, bonds and money market investments according to the fund’s investment strategy. It may
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Stock Option
A stock option is derivative financial instrument that gives the holder of the option the right to buy some particular stock at the predetermined strike price till the end of the option (or at the end, depending
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Index Options
Index options are derivative financial instruments that provide for the buyer of the option the right (possibility) to make profits from index value changes. It may be a good investing instrument for the investor
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High Return Investments
High-return investments (or high-yield investments) are investments that can provide the higher return than average investments, and of course such investments are riskier. The reality is that people have differe
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Stock Trader
A stock trader is a speculator that is trying to make profits from quick changes in value of stocks or other securities that he trades. Stock trader have few differences from normal investor and the main differen
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Investment Bubble
Investment bubble is a jump in price of particular investment when price starts increasing faster and faster as long as the price reaches its peak and falls down to a similar to previous level, if there are no ot
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Active Investment
Active investment (management) is opposite to passive investment and means that investments are managed by some investment professional that picks the securities according to investment market tendencies and
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Passive Investment
Passive investment (management) is an investment style when investors skips the steps of securities picking and market timing and invests mainly in index funds that have the lowest expenses. P
http://www.investingforbeginners.eu/passive_investment
Best Investments
Best investments are always wanted, but the reality is that there are no best investments for everyone. And if such investment would exist then those investments would become an investment bubble and would not st
http://www.investingforbeginners.eu/best_investments
Investment Websites
Investment websites are websites that provide useful information about investing and investments or websites that allow you to open a trading platform and trade some investments online. There are m
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Investment Information
Investment information is crucial to make good investment decisions. It is information that may help to make good investment solution and would help to reach for better investment results. The deta
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Short-Term Investments
Short term investments are investments that are suited for short term investing. There can be different understanding of short term investing but it is normal that investments for period till one year can be cons
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Safe Investments
Safe investments are investments that contain low risk and considered to be safe. Safe investments do not necessary have to be 100% safe because there is no 100% safe investments in this world as this world isn&r
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Personal Investing
Personal investing is investing when investments are made by an individual but not a corporation which is corporate investment. Personal investing is a part of personal finance that is responsible for pe
http://www.investingforbeginners.eu/personal_investing
CIS countries
CIS countries (Commonwealth of Independent States) is by Russia led group of countries that earlier belonged to the Soviet Union. However, not all the countries of the past Soviet Union’s belong to CIS coun
http://www.investingforbeginners.eu/cis_countries
Stock Market Trading
Stock market trading is similar to stock market investing; however, it is not exactly the same. At first, stock trading refers to a stock trader who trades stocks very often and do not invests for a long term. Lo
http://www.investingforbeginners.eu/stock_market_trading
Best Stocks
Best stocks would depend on criteria of the particular investor. Of course, you could say that best stocks should be the stocks that will increase the most in the future. But reality is that nobody knows about th
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Liquidity
(1) Market liquidity is a characteristic of a security or other traded investment that shows how easy it is convertible in to cash at a market value. Usually when investor decides to sell some investment and
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Real Estate Investment Management
Real estate investment management is a management of real estate portfolio. Real estate investments are different from standard investments (securities) and management of real estate investments differs from inve
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Investment Management Consultations
Investment management consulting is part of investment management business that helps for investors to manage their investments more effectively. Investment management is one of the most crucial step in personal
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Private Equity Investor
Private equity investor is a corporation or individual that is investing in stakes of unlisted companies. The only different between equity investor and private equity investor is that the last one invests in unl
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Business Investor
A business investor can indicate several types of investors. (1) Business investor may be an investor that is a firm and invests in different investments, or (2) investments that are made by any investor in to co
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Private Investors
Private investors are individuals that are investing in to some assets for investment purpose. (1) There are two main types of investors: private investors and institutional investors (business investor). Also th
http://www.investingforbeginners.eu/private_investors
Small Business Investors
Small business investors are private investors or business investors that are investing in to small businesses. Small businesses are also in need for capital and the best source for that capital might a bank beca
http://www.investingforbeginners.eu/small_business_investors
Angel Investors
Angel investors are investors that have capital for investments and are investing in young companies that are in start-up stage and are needed for capital to exploit growth potential. The source of funding from a
http://www.investingforbeginners.eu/angel_investors
Finding Investors
Finding investors might be a hard task if you have no required knowledge for that. Most probably you are looking some business investors or angel investors that would invest in to your business. And the success o
http://www.investingforbeginners.eu/finding_investors
Area Investors
Area investors are local business investors that are investing in their local living area. Area investing has some advantages. The main advantage is that local are investors know the nuances of the place and can be sure
http://www.investingforbeginners.eu/area_investors
Overvalued Stocks
Overvalued stocks are those stocks that cost in stock market more than their target price is. Target price of the stock is calculated market value of a stock using stock valuation methods. The most popular method
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Balance Sheet
Balance sheet is one of the three main financial statements (others are income statement and cash flow statement). Balance sheet also might be called a statement of financial position because this statement expla
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Profit
Profit is a term used in various finance fields and may have many meanings. Basically profit is the positive difference between the income and costs. If costs are higher than income, then instead of profit loss w
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Income
The term income may have several meanings. In corporate finance it basically means profit or earnings that are equal to revenue less expenses. But in some cases income may also indicate company’s revenue bu
http://www.investingforbeginners.eu/income
Loss
Loss (net loss) is a financial situation of the company when its revenue is lower than expenses. It is natural that every company tries to receive a profit instead of a loss, but not every succeeds that. Some com
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Financial Analysis
Financial analysis is an important part of investing, especially if investor wants better results from his investments. Of course it is possible to ignore financial analysis and make investment decisions based on
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Return
Return analysis is different from profitability analysis because usually return is measured as a profitability of the assets, investments, capital or other similar asset group but not as a profitability of the re
http://www.investingforbeginners.eu/return
Debt to Equity
Debt to equity ratio (also known as D/E ratio, Debt/Equity) measures how big is company’s debt compared to its book capital (equity). The higher is the debt to equity ratio the higher is the insolvency risk
http://www.investingforbeginners.eu/debt_to_equity
Financial Planning
Financial planning is a type of financial analysis of which goal is to predict financial situation of the object in the future. There are two main trends where financial planning can be applied: in corporate fina
http://www.investingforbeginners.eu/financial_planning
Asset Turnover Ratio
Asset turnover ratio compares company’s sales and assets in order to identify the efficiency of assets used in the business. In simple words, it shows show much of sales are generated by company’s ass
http://www.investingforbeginners.eu/asset_turnover_ratio
Working Capital Management
Why Working Capital Is Important? Working capital is one of the main parts of company’s finances and every manager, even of the small company, manages working capital despite the fact he knows about that o
http://www.investingforbeginners.eu/working_capital_management
investments in Blue Chip Stocks
Stock investments require high degree of financial knowledge and the understanding of market realities, but only if you are seeking for the most efficient result. Yet, the reality is that there are millions of pe
http://www.investingforbeginners.eu/investments_in_blue_chip_stocks
investments in Small Cap Stocks
investments in Small Cap Stocks investments in small cap stocks could be compared to penny stock investments but the term ‘penny stocks’ is not specific enough. The thing is that the determination of
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Stocks and Commodities
You may ask how stocks and commodities related are. And the answer is simple: everything is related and especially in financial markets. Normally, if some of the main asset class (as stocks) looses or gains
http://www.investingforbeginners.eu/stocks_and_commodities
Investment Formula
If you are looking for some perfect investment formula, you should get disappointed because there is no secret investment formula that would be profitable for every investor. If there would be such perfect formul
http://www.investingforbeginners.eu/investment_formula
Opex
Opex (operating expense) are expenses of the business and are related to the operational activity of the company. Basically, every company has few types of expenses: COGS (cost of sales) include costs t
http://www.investingforbeginners.eu/opex
Capex
Capex (capital expenditure) is company’s investment in long-term assets that are needed to continue the business or for future’s growth. The perfect examples of capital expenditure can be an acquisiti
http://www.investingforbeginners.eu/capex
Operating Cash Flow
Operating cash flow or ‘cash flow from operations’ (CFFO) is one of the most important among financial indicators and is used to measure company’s results in cash terms. While net income or oper
http://www.investingforbeginners.eu/operating_cash_flow
Cash Investments
Cash investments are the safest investments over short-term period. Such investments include saving accounts, certificates of deposit, money market instruments (treasury bills, money market funds). The main crite
http://www.investingforbeginners.eu/cash_investments
Volatility
What is volatility? Volatility definition can be short: volatility is the size of the amplitude in investment’s value changes over time. In simple words, it describes the riskiness of the security because
http://www.investingforbeginners.eu/volatility
Intangible Assets
All assets can be classified to three main groups: tangible assets, financial assets and intangible assets. Intangible assets are those assets that aren’t financial and don’t have a real physical form
http://www.investingforbeginners.eu/intangible_assets
Return on Invested Capital
Return on invested capital (ROIC) or also called return on capital is a financial ratio employed to measure nominal company’s return that is earned by capital invested in operating asset. Basically return o
http://www.investingforbeginners.eu/return_on_invested_capital
Fundamental Analysis
Fundamental analysis is the type of financial analysis that relies on company’s fundamentals. Those fundamentals depend on the target of the analysis. For example, fundamental analysis of stock depends on i
http://www.investingforbeginners.eu/fundamental_analysis
Capital Employed
Capital employed is a value of capital investments in a company. Basically, the capital of each company can be classified in these types of capital: Equity capital Debt capital Working capital
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Return on Capital Employed
Return on capital employed ratio (ROCE) measures company’s return compared to its employed capital. Return in this case is some kind of profit (mostly EBIT or NOPAT) and the capital employed means equity ca
http://www.investingforbeginners.eu/return_on_capital_employed
CAGR Formula
CAGR formula is used to calculate 'compound annual growth rate': CAGR = (Value at the end / Value at the beginning) ^ (1 / Years) - 1 * Can be multiplied by 100%. Where: Value at t
http://www.investingforbeginners.eu/cagr_formula
Leverage
Leverage definition In finance leverage means usage of debt capital in addition to the equity capital in order to increase the profit. Increase in leverage is understood as increase in riskiness and volatility.
http://www.investingforbeginners.eu/leverage
Market Risk Premium
(Equity Risk Premium) Every investment carries some level of risk and some level of potential return. Those two measures are closely related in investment finance and are used in CAPM which calculates cost of eq
http://www.investingforbeginners.eu/market_risk_premium
Back-End Load
Back-End Load (redemption fee) is a load fee which is similar to ‘front-end load’ but is paid when investor sells his mutual fund units instead of during the acquisition as in case of ‘front-end
http://www.investingforbeginners.eu/backend_load
