Share is a unit of ownership interest in a corporation. Ownership is determined by the number of shares owned relative to the number of shares outstanding. A shareholder has a claim to a part of the companies’ assets and liabilities
There are basically two types of shares:
Equity Share: Equity shareholders are entitled to voting rights in the 6d91b5. They receive dividend (if declared by the board of directors ) and are the last creditors to the 6d91b5 in case of bankruptcy.
Preference Share: Preference shareholders are given fixed dividend but have no voting rights. In case of bankruptcy, their claims over company’s assets are preferred over equity shareholders.
Primary Markets are where shares of company are sold to public for the first time in order to raise capital or expand its business. This is done by issuing IPO (Initial Public Offering).
Secondary Markets are where investors buy and sell shares that are already listed in stock exchange.
The two main stock exchanges in India are BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).
Investors cannot buy shares directly from the exchange. They require intermediaries like stock brokers who can understand their needs and buy stocks on their behalf. They conduct transactions for the investor without actually owning the securities and charge brokerage commission in return.
Equity investment is subject to securities transaction tax (STT), capital gains tax and service tax. Under capital gains tax, Short term capital gain is charged when shares are sold within a year of purchasing it and Long term capital gain is levied when the time frame exceeds a year. Dividends earned on shares are tax-free.
Bid Rate is the price which a prospective buyer is willing to pay for a stock and Ask Rate is the price which a prospective seller is willing to accept for a stock.
Market Order is an order to buy or sell a security at the best market price available and Limit order is an order to buy or sell a security at a specified price. As market price keeps changing, a market order cannot guarantee a specific price and a limit order cannot guarantee execution of trade.
Stop Loss: Stop loss is an order to sell a security if it reaches a pre determined price called the trigger price. It is price defensive mechanism designed to limit investor’s loss on a security
Stop Buy: An order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.
Demand & Supply: Stock prices change due to supply and demand based on the outlook of the company by people.
Growth Potential: Also, it depends on the further growth potential of the company based on its earnings and sales.
There is no fixed time horizon for investing in equities. But it is better to invest as early as one can because experts suggest that long term investments generally lead to better returns.
Trading on the equities segment takes place on all days of the week (except Saturdays and Sundays and holidays declared by the Exchange in advance). The market timings of the equities segment are:
Market Open: 09:15 hrs
Market Close: 15:30 hrs
Derivatives are financial instruments that derive their value from underlying assets like shares, commodities, currency, livestock, index, etc. The different types of derivatives are Futures, Forwards, Options and Swaps. Derivatives give you an opportunity to earn superlative profits by paying nominal amount of margin.
Futures are contracts obligating the buyer to purchase a financial instrument, at a predetermined future date and price. Futures are standardized to facilitate trading on a futures exchange. Some futures contracts may call for physical delivery of the asset, while others are settled in cash. Futures contracts are marked-to-market daily, which means that daily changes are settled day by day until the end of the contract.
Options are contracts which give the buyer (the owner) the right, but not the obligation, to buy or sell an underlying asset at a specified strike price on or before a specified date. An option which conveys to the owner the right to buy something at a specific price is referred to as a call; an option which conveys the right of the owner to sell something at a specific price is referred to as a put.
Option premium is the price paid by option buyer for acquiring the right to buy or sell an asset.
Currency Derivatives are Future and Options contracts which you can buy or sell standardized quantity of a particular currency pair at a future date. It is similar to the Stock Futures and Options but the underlying happens to be currency pair (i.e. USDINR, EURINR, JPYINR OR GBPINR) instead of Stocks.
On a currency exchange platform, you can buy or sell currency futures. Suppose, you are an importer, you can buy futures to “lock in” a price for your purchase of actual foreign currency at a future date. You thus avoid exchange rate risk that you would otherwise have faced.
Volatility Index is a measure of expected stock market volatility, over a specified time period, conveyed by the prices of stock / index options. It depicts the collective sentiment of the market on the implied future volatility.
It is the last day on which the contracts expire. Futures and Options contracts expire on the last Thursday of the expiry month. If the last Thursday is a trading holiday, the contracts expire on the previous trading day.
Margins refer to the cash or securities required to be deposited by an investor with his brokerage firm as collateral for the investor’s obligation to buy or sell the underlying security, or in the case of cash-settled contracts to pay the cash settlement amount.
All the Futures and Options contracts are settled in cash on a daily basis and at the expiry or exercise of the respective contracts as the case may be.
Commodities are goods that are used for further production of other goods and services. Some examples of commonly traded commodities are oil and natural gas, gold, copper and nickel, sugar, coffee, soybean, etc. Commodities not only offer a good way to diversify a portfolio of stocks and bonds, but also offer better returns. The returns on commodities futures “positively correlate” with inflation and so their returns do better in inflationary times.
These are contracts between two parties to buy or sell commodities at a pre-determined price at a future date. Commodity futures are different from forwards as they are standardized and exchange traded.
Commodity Market is regulated by Forwards Market Commission (FMC) under the guidance of the Ministry of Consumer Affairs, Food, & Public Distribution.
The major exchanges for Commodity are Multi-Commodity Exchange of India (MCX), National Commodity and Derivative Exchange of India (NCDEX) and National Multi Commodity Exchange (NMCE).
Different costs involved in commodity trading are:
Yes delivery of commodities is available but it is not compulsory, cash settlement is also available. However, the intention of physical delivery should be informed beforehand.
No, presently Commodity Options are prohibited under Section 19 of the Forward Contracts (Regulation) Act, 1952.
Trading on the Commodity Futures takes place from 10 am – 11.30 pm from Monday to Friday.
IPO (Initial Public Offering) is when an unlisted company issues its shares to general public for the first time. When a company wants to raise capital or expand its operation, they issue an IPO.
FPO (Follow on Public Offer) is a process by which a company, which is already listed on an exchange, issues new shares to the investors or the existing shareholders, usually the promoters. FPO is used by companies to diversify their equity base.
Book Building IPO: It is an offering in which the company sets a price range i.e. Floor Price & Cap Price. The final price is decided after the closure of the issue based on the bids received.
Fixed Price IPO: It is an offering in which shares are allotted at a price, which is known to the subscribers at the time of making an application.
We send emails regarding the issue of IPO to our clients. The information about the same can be found on our website by clicking here.
It is a process of assigning a grade to the IPO of equity share by a Credit Rating Agency registered with SEBI. The grade which is a five point scale represents a relative assessment of the fundamentals of that issue in relation to other listed shares in India.
The allotment process depends on the demand of the issue. The basis of allotment is decided by the Book Running Lead Managers (BRLM) within two weeks from the date of closure of the issue and is publicly declared.
A full refund is made to those who do not get any allotment. And for others, refund is made as per their allotment status.
As per the requirement, all the public issues of size in excess of Rs.10 crores, are to be made compulsorily in the demat mode. Thus, if an investor chooses to apply for an issue that is being made in a compulsory demat mode, he has to have a demat account and has the responsibility to put the correct DP ID and Client ID details in the bid/application forms.
The three types of investor categories are:
Retail Individual Investor (RII): An investor who applies or bids for securities of or for a value of not more than Rs. 1,00,000/-
High Net worth Individual (HNI): If retail investor applies more than Rs. 1,00,000/- of shares in an IPO, they are considered as HNI.
Non Institutional Bidders (NIB): Individual investors, NRI’s, companies, trusts etc who bid for more than Rs. 1,00,000/- are known as Non-institutional bidders. They need not to register with SEBI like RII’s.
Qualified Institutional Bidders (QIB): Financial Institutions, Banks, FII’s and Mutual Funds who are registered with SEBI are called QIB’s. They usually apply in very high quantities.
Book Building IPO allotments usually completes within 15 days of IPO subscription closing date. Once allotment is done, it takes another 3-5 working days to receive shares. Fixed Price IPO takes around a month for allotment and then 3 to 5 days to receive.
All rules, regulations and procedures relating to an IPO issue is governed by SEBI. Any company planning to go public in India is required to get approval from SEBI before opening its IPO.
Mutual fund is a professionally managed investment scheme that pools money from different investors having same financial goals. Mutual funds may invest in variety of instruments like stocks, bonds, money market securities, gold or a combination of these which provides diversification to your investments.
Depending upon the instruments in which a mutual fund invests, there are three types of mutual fund.
Equity Mutual Funds: Equity Mutual Funds invest in stocks of listed companies.
Debt Mutual Funds: Debt Mutual Funds invests in bonds of reputed corporation and government.
Hybrid Mutual Funds: Hybrid Mutual Funds invest in both shares and bonds.
Open Ended Scheme: These schemes are available for subscription and repurchase on daily basis and hence provide greater liquidity. They do not have a fixed maturity and its unit can be brought or sold at NAV which are declared daily.
Close Ended Scheme: These schemes have a fixed maturity, i.e., 5 to 7 years. They are only available for subscription during a specified period from the time of launch. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where the units are listed.
Benefits of investing in a mutual fund:
Professional Investment Management Professional Fund Managers having in-depth knowledge and skills make sound investment decisions and keep monitoring them.
Increased Diversification Mutual Funds invest in various stocks and bonds and hence provide better diversification and lower risk.
Highly Regulated – Mutual Funds are registered with SEBI and so all activities of Mutual Fund are monitored by SEBI.
Transparency Open Ended Scheme declare NAV on daily basis and regular updates on value of the investment are also available.
Higher Liquidity – Open end scheme provide option to redeem on demand making the investment highly liquid.
Affordability Mutual Funds makes investing in many stocks and bonds in small units affordable.
SEBI formulates policies and regulates the mutual funds to protect the interest of the investors. SEBI notified regulations for the mutual funds in 1993. Thereafter, mutual funds sponsored by private sector entities were allowed to enter the capital market. The regulations were fully revised in 1996 and have been amended thereafter from time to time. SEBI has also issued guidelines to the mutual funds from time to time to protect the interests of investors.
Net asset value (NAV) represents the market value of all assets per unit, held by the fund. For an investor, it simply signifies the current value of his or her investment in the fund.
A Systematic Investment Plan (SIP) is a convenient method of investing in mutual funds. Under this plan, an investor contributes a fixed amount towards the mutual fund scheme at regular intervals, and gets units at the prevailing NAV.
Except for Exchange Traded Funds, investors do not need a demat account to invest in MF.
Fund Managers are professionals responsible for making investment decisions related to Mutual Funds. They implement funds’ investment strategy and manage their trading activities. Fund managers are paid a fee for their work, which is a percentage of the fund’s average assets under management.
Fund of Funds Scheme invest in other schemes of same or different mutual funds that provide greater diversification to the investors and in return charge a higher fee.
Yes. However, no change in the nature or terms of the scheme, known as fundamental attributes of the scheme e.g. structure, investment pattern, etc. can be carried out unless a written communication is sent to each unit holder and an advertisement is given in one English daily having nationwide circulation and in a newspaper published in the language of the region where the head office of the mutual fund is situated.
There may be changes from time to time in a mutual fund. The mutual funds are required to inform any material changes to their unit holders. Apart from it, many mutual funds send quarterly newsletters to their investors.
Performance of a mutual fund scheme can be assessed by looking at its Net Asset Value (NAV) that is declared daily for open ended scheme and weekly for close ended scheme.
Tax-Saving Schemes offer tax rebates to the investors under tax laws prescribed from time to time. Under Sec.88 of the Income Tax Act, contributions made to any Equity Linked Savings Scheme (ELSS) are eligible for rebate @20% for a maximum investment of Rs. 10,000 per financial year.
The deposit placed by investors with companies for a fixed term carrying a prescribed rate of interest is called Company Fixed Deposit. At the end of deposit period principal plus interest is returned to the deposit holder.
Cumulative FDs: In this type of investment, Earned interests are added to Principal and so investors earn interest on interest. This is a good option for investor, if they are not looking for regular income from the FD. Non Cumulative FD: In this type of investment, interest is received on regular interval and further interest is calculated on the original principal.
Companies registered under Companies Act 1956, such as:
A Non-Banking Non-Finance Company (Manufacturing Company) can accept deposits up to 10% of the aggregate of paid-up share capital and free reserves if the deposits are from shareholders or guaranteed by the directors, otherwise up to 25% of the aggregate of paid-up share capital and free reserves.
A Non-Banking Finance Company can accept deposits up to following limits: An Equipment Leasing Company can accept four times of its net owned fund. A Loan or Investment Company can accept deposit up to one and half times of its net owned funds.
Interest is paid on monthly/quarterly/half yearly/yearly or on maturity basis and is sent either through cheque or ECS facility
TDS is deducted if the interest on fixed deposit exceeds Rs.5000/- in a financial year.
All Indians (except NRIs) can buy Fixed Deposit through Eureka.
Eureka distributes FDs of HDFC ltd, DHFL, PNB Housing Finance Ltd, Mahindra Finance and Shriram Unnati on selection basis and other FDs are also distributed on request basis
Bonds are financial instruments in which the issuer owes the holder a debt and is obliged to pay interest at regular intervals and the principal amount at maturity.
A government bond is a bond issued by a national government, with a promise to pay periodic interest payments and to repay the face value on the maturity date.
A corporate bond is a bond issued by a corporation. It is a bond that a corporation issues to raise money effectively in order to expand its business. Generally; corporate bonds offer a higher yield than government bonds because their credit risk is generally greater.
Bonds provide regular income and higher returns compared to FDs, postal savings, etc. They are less volatile than stocks and therefore provide better stability. If a company is liquidated, bondholders usually have priority over stockholders in a company’s capital structure and are more likely to receive payment. Also, payments from some bonds are exempted from taxes.
Risk in investing in bond is that the issuer of the bond may not be able to make promised payments and hence default. Also, if inflation rises, the purchasing power of bonds’ coupon and principal will reduce.
Interest rate and Maturities are directly proportional to each other. In other words, the longer the maturity of a Bond, higher is risk of price fluctuation and so higher the interest rate.
Eureka distributes all bonds including tax free bonds, non convertible debentures (secured and unsecured) and perpetual bonds.
A depository is an organisation which holds securities (like shares, debentures, bonds, government securities, mutual fund units etc.) of investors in electronic form at the request of the investors through a registered Depository Participant. It also provides services related to transactions in securities.
Dematerialisation is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form.
At present two Depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) are registered with SEBI.
A Depository Participant (DP) is an agent of the depository through which it interfaces with the investor and provides depository services.
All the benefits of the dematerialized shares are given to the actual investor since the depository holds the securities in a fiduciary capacity on behalf of the investors who have opened a demat account with the depository. Hence, the actual investor is the “Beneficial Owner” (BO) of the securities.
A depository interfaces with the investors through its agents called DPs. If an investor wants to avail the services offered by the depository, the investor has to open a BO account with a DP.
The benefits are enumerated below:-
Change in address recorded with DP gets registered with all companies in which investor holds securities electronically eliminating the need to correspond with each of them separately; Transmission of securities is done by DP eliminating correspondence with companies; Automatic credit into demat account of shares, arising out of bonus/split/consolidation/merger etc. Holding investments in equity and debt instruments in a single account.
As per the Depository Act of 1996, you have an option to hold shares either in physical or dematerialized form.
It gets allotted to an investor’s DP account as per his/her option.
ISIN (International Securities Identification Number) is the identification number given to a security of an issuer when admitting such security in the depository system.
Demat Account or dematerialised account is an account where shares & securities are electronically held instead of investors possessing physical certificates. An investor opens a demat account while registering with an investment broker. The demat account number is quoted in all transactions to enable electronic settlements of trades.
A client submits a Dematerialisation Request Form (DRF) along with the physical share certificates to the DP with which it has opened its demat account, who in turn forwards it to the Registrar & Transfer agent for confirmation from the company whose shares the investor is holding. After confirmation, the client account is credited.
Once an NRI becomes a resident in India, he/she needs to open a new demat account in the non-NRI status and transfer all the securities from the NRI demat account to the new demat account and close the NRI demat account. NRIs who were also trading using their trading account need to open a new trading account and integrate it with the new demat account.
A Non Resident India (NRI) is a citizen of India who holds an Indian passport and has temporarily emigrated to another country for six months or more for employment, residence, education or any other purpose.
A person of Indian origin (PIO) is a person of Indian origin or ancestry who was or whose ancestors were born in India or nations with Indian ancestry but is not a citizen of India and is the citizen of another country. A PIO might have been a citizen of India and subsequently taken the citizenship of another country.
Yes, they can invest in shares of Indian Company through Stock Market under the Portfolio Investment Scheme.
Yes there is no restriction in opening accounts in different banks simultaneously.
NRIs can only make delivery transactions, intraday trading and short selling is not allowed as per RBI norms.
The types of Bank Accounts available to NRIs are:
Non Resident External (NRE) account is a Rupee denominated account meant for NRIs which allows repatriation of funds. This means that the funds can be freely sent to any other country. NRE account can contain funds remitted from abroad, or obtained from another NRE / FCNR account maintained in India. The interest earned on deposits in an NRE account is exempt from tax in the hands of the NRI.
Non Resident Ordinary (NRO) account is a Rupee denominated account which allows repatriation of upto 1 million USD. NRIs can repatriate up to USD 1 million, for bonafide purposes, per financial year from balances in NRO Accounts subject to payment of applicable taxes. The limit of USD 1 million per year includes sale proceeds of immovable properties held by NRIs/PIO (Person of Indian Origin) for a period of 10 years. In case a property is sold after being held for less than 10 years, remittance can be made if the sale proceeds have been held by the NRI/PIO for the balance period in eligible investments. The interest earned on deposits in an NRO account is taxable in the hands of the NRI as per the applicable income tax slab rates.
|People who can open this account?||NRIs||Any person residing outside India|
|Joint account permitted of 2 or more NRIs?||Yes||Yes|
|Joint account permitted with another person residing in India?||No||Yes|
|Joint account permitted with another person residing in India?||No||Yes|
|Currency in which the account is denominated||INR||INR|
|Is the principal repatriable?||Freely||Partly|
|Is the interest repatriable?||Freely||Freely|
|Risk- Foreign currency?||Account holder is exposed the fluctuations in the value of INR||Account holder is exposed the fluctuations in the value of INR to the extent of interest amount|
Yes, money can be freely transferred from NRE account to NRO account.
No, money cannot be transferred from NRO to NRE account. Even if erroneously, money is transferred from NRE to NRO, it cannot be transferred back to NRE.
No permission is required from RBI to open a demat account. However, credits and debits from demat account may require general or specific permissions as the case may be, from designated banks.
For long term investment, i.e., shares that are held for more than 1 year from the date of purchase, there is no capital gain tax applicable if it’s sold after 1 year. However, if shares are sold within 1 year from the date of purchase, then the gains would be taxed.
Securities Lending and Borrowing (SLB) is a scheme that has been launched to enable settlement of securities sold short. SLB enables lending of idle securities by the investors through the clearing corporation/clearing house of stock exchanges to earn a return through the same. For securities lending and borrowing system, clearing corporations/clearing house of the stock exchange would be the nodal agency and would be registered as the “Approved Intermediaries” (AIs) under the Securities Lending Scheme, 1997.
Securities in the F&O segment are eligible for SLB.
Under SLB, securities can be borrowed for a tenure of up to 12 months. The fixed settlement dates are the first Thursday of the respective month and the date is displayed on the SLB trading screen at the time of order entry.
The rate of interest for SLB is dependent on the stock’s value on that day and is generally calculated on a per month basis.
Shares are borrowed by traders for the purpose of short selling it in the market. When an investor has a negative view on the stock, he/she borrows it through SLBM and sells it and later buys them back when price falls.
Long term investors who own a large number of shares and are not planning to sell them in the near future lend their shares through SLB Scheme. This gives long-term investors an opportunity to earn additional income.
Features of Securities lending and borrowing scheme are as follows:
SEBI permits all categories of investors i.e. retail and institutional to participate in SLBM.
NSCCL acts as a central counterparty in the SLB Scheme providing financial settlement guarantee.
The settlement cycle for SLB transactions shall be on T+1 basis. The settlement of lending and borrowing transactions shall be independent of normal market settlement. The settlement of the lending and borrowing transactions shall be done on a gross basis at the level of the clients i.e. no netting of transactions at any level will be permitted.
|Account disclosure(Depositor Account)||The closure of beneficiary and pool accounts by the investor and the clearing member or at the discretion of the participant, if the client has defaulted in its obligations towards the participant.|
|Accounts payable||A current liability showing the amounts due to others within a period of one year arising from purchase or manufacturing of inventories.|
|Accounts receivable||Any amount due to a business for merchandise or securities that it has sold or services it has rendered.|
|Accrued Interest||A measure of the return to a bondholder calculated as a ratio of the coupon to the market price.|
|Acid Test Ratio||The value of cash equivalents and accounts receivable (the quick assets) divided by current liabilities.|
|Active portfolio strategy||A strategy that uses available information and forecasting techniques to seek a better performance than a portfolio that is simply diversified broadly.|
|Adjusted Beta||The estimation of a security’s future beta, which is derived from historical date, but is modified assuming that the security’s real beta has tendency to move towards the market average of one.|
|Advance-Decline (A/D) Line||A technical analysis tool representing the total of differences between advances and declines of security prices.|
|Agency Orders||Orders that a broker dealer executes for the account of a customer with another professional or retail investor|
|Amortization||Amortization is an accounting term that refers to the process of allocating the cost of an intangible asset over a period of time.|
|American Option||An option that can be exercised any time prior to and including its maturity date.|
|Annual Report||A financial report issued by a company to its shareholders at the end of financial year.|
|Approved Intermediary||A person duly registered by the SEBI Board under the Securities Lending Scheme , 1997 through whom the lender of securities will deposit the securities and the borrower will borrow the securities.|
|Arbitrage||Arbitrage consists of purchasing a commodity or security in one market for immediate sale in another market.|
|Ask or Offer||Ask price is the lowest price a prospective seller is willing to accept.|
|Assets||It represents ?everything that the company owns and what owed to it. There are two major categories of assets: fixed assets and current assets|
|Asset Allocation||The process of determining the optimal division of an investor’s portfolio among different assets|
|Asset Allocation Fund||A mutual fund that splits its investment assets among stocks, bonds, and other vehicles in an attempt to provide a consistent return for the investor.|
|Asset-backed securities||Securities backed by assets that are not mortgage loans. It includes assets backed by automobiles loans, credit card receivables and others.|
|Assignment||The notification to the seller of an option by the clearing corporation that the buyer of the option is enforcing the terms of the option’s contract.|
|Asymmetric Information||A situation where access to information by one party (or parties) to a transaction is better than access by another party (or parties).|
|At Best||An instruction from the client to the broker authorizing him to use his discretion so as to execute an order at the best possible market price.|
|At-the-Money||Term used to describe an option or a warrant with an exercise price equal to the current market price.|
|Auditor||A person who is professionally qualified to examine and scrutinize accounts.|
|Auction||A mechanism used by the Stock Exchange to fulfill its obligation to the buyer of a security. It is done when the seller is unable to deliver the scrips sold by him. The security in question is offered by a member who has ready possession of the scrips.|
|Authorized Capital||The maximum equity capital a company can raise, which is mentioned in the Memorandum of Association and Articles of Association of the Company. However, share premium is excluded from the definition of authorized capital.|
|Average Annual Growth Rate – AAGR||The average increase in the value of a portfolio over the period of a year .|
|Averaging||The process of gradually buying more and more securities in a declining market (or selling in a rising market) in order to level out the purchase (or sale) price.|
|Back office||The part of a firm that is responsible for post-trade activities.|
|Bad debts||A debt that cannot be recovered.|
|Balance sheet||An accounting statement of a company’s assets and liabilities, provided for the benefit of shareholders and regulators.|
|Balanced fund||Funds which aim to provide both growth and regular income as such schemes invest both in equities and fixed income securities in the proportion indicated in their offer documents.|
|Bank reconciliation||A Bank reconciliation is a process that explains the difference between the amounts recorded in the cashbook and relevant bank statements.|
|Bankrupt||An individual is bankrupt when declared in law as unable to pay their debts.|
|Bankruptcy||Bankruptcy is a legal status of a person or other entity that cannot repay the debts it owes to creditors.|
|Basis||It is defined as the cash price (or spot price) of whatever is being traded minus its futures price for the contract in question.|
|BASIS RISK||The risk that the relationship between the prices of a security and the instrument used to hedge it will change, thereby reducing the effectiveness of the hedge.|
|Bear Hug||A variety of takeover strategy that seeks to hurry target company managements to recommend acceptance of a tender offer in a short period of time.|
|Bear market||A weak or falling market characterized by the dominance of sellers.|
|Bear spread||In options trading, a bear spread is a bearish, vertical spread options strategy that can be used when the options trader is moderately bearish on the underlying security.|
|Bear trap||A false signal indicating that the rising trend of a stock or index has reversed when in fact it has not.|
|Benchmark||Security used as the basis for interest rate calculations and for pricing other securities.|
|Beneficial Owner||The true owner of a security|
|Beta||A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole.|
|Bid||An offer of a price to buy as in an auction|
|Bid and ask||The difference between the bid price and the ask price.|
|Block trading||Buying and selling a block of securities usually takes place when restructuring or liquidating a large portfolio.|
|Blue Chip Stocks||The best rated shares with the highest status as investment based on return, yield, safety, marketability and liquidity.|
|Bonds||These are debt securities issued by corporations and governments.|
|Bonus Share||A bonus share is a free share of stock given to current shareholders in a company, based upon the number of shares that the shareholder already owns|
|Bookkeeping||The process of keeping records of the financial affairs of a business.|
|Book Closure||The time period when a company will not handle adjustments to the register, or requests to transfer shares.|
|Book value||The net amount shown in the books or in the accounts for any asset, liability or owners’ equity item.|
|Boom||A condition of the market denoting increased activity with rising prices and higher volume of business resulting from greater demand of securities.|
|Box Spread||A dual option position involving a bull and bear spread with identical expiry dates. This investment strategy provides for minimal risk.|
|Breadth of Market||The number of securities listed on the market in which there is regular trading.|
|Break-even point||Break-even (or break even) is the point of balance between making either a profit or a loss.|
|Breakout||A situation where the price either goes above the resistance level or below the support level.|
|Broker or Brokerage Firm||A member of a Stock Exchange who acts as an agent for clients and buys and sells shares on their behalf in the market.|
|Brokerage||Commission payable to the stockbroker for arranging sale or purchase of securities.|
|Bubble||A speculative sharp rise in share prices which like the bubble is expected to suddenly burst.|
|Budget||An estimation of the revenue and expenses over a specified future period of time.|
|Bull Market||A market in which share prices are rising, encouraging buying.|
|Bull spread||In options trading, a bull spread is a bullish, vertical spread options strategy that is designed to profit from a moderate rise in the price of the underlying security.|
|Buoyancy||A rising trend in prices.|
|Butterfly spread||An option strategy involving the simultaneous sale of an at the money straddle and purchase of an out of the money strangle.|
|Buying on margin||To buy shares with money borrowed from the stockbroker, who maintains a margin account for the customer.|
|Calendar spread||The simultaneous sale and purchase of either calls or puts with the same strike price but different expiration months.|
|Call Option||An agreement that gives an investor the right, but not the obligation, to buy an instrument at a known price by a specified date.|
|Capital||A measure of the value of all of the assets of worth owned.|
|Capital cost||Capital costs are fixed, one-time expenses incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services.|
|Capital gain||A profit from the sale of property or an investment.|
|Capital growth||An increase in the market price of an asset. also called capital appreciation.|
|Carry Forward||Settlement where positions are carried forward from one settlement to another settlement.|
|Cash flow||The total amount of money being transferred into and out of a business, especially as affecting liquidity.|
|Cash settlement||The settlement provision on some options and futures contracts that do not require delivery of the underlying.|
|Certificate of deposit||A negotiable certificate issued by a bank, usually for a period of one month to a year, as evidence of an interest bearing time deposit.|
|Circuit Breaker||A system to curb excessive speculation in the stock market, applied by the Stock Exchange authorities, when the index spurts or plunges by more than a specified per cent.|
|Clearing House||A department of an exchange or a separate legal entity that provides a range of services related to the clearance and settlement of trades and the management of risks associated with the resulting contracts.|
|Close ended Fund||A type of investment company that has a fixed number of shares which are publicly traded.|
|Closing price||The rate at which the last transaction in a security is struck before the close of the trading hours|
|Common Stock||Units of ownership of a public corporation. Holders of common stock typically have voting rights and receive dividends, but there is no guarantee of dividend payment.|
|Condor||A condor is an options strategy that also has a bear and a bull spread, except that the strike prices on the short call and short put are different.|
|Contract Note||A note issued by a broker to his constituent setting out the number of securities bought or sold in the market along with the rate, time and date of contract.|
|Convertible Bond||A bond giving the investor the option to convert the bond into equity at a fixed conversion price or as per a pre-determined pricing formula.|
|Coupon Rate||The interest rate stated on the face of coupon.|
|Credit||A contractual agreement in which a borrower receives something of value now and agrees to repay the lender at some date in the future|
|Creditor||An entity (person or institution) that extends credit by giving another entity permission to borrow money if it is paid back at a later date|
|Credit limit||Credit limit also refers to the maximum amount a credit card company will allow someone to borrow on a single card.|
|Credit rating||Credit ratings measure a borrower’s creditworthiness and provide an international framework for comparing the credit quality of issuers and rated debt securities.|
|Credit history||A record of a consumer’s ability to repay debts and demonstrated responsibility in repaying debts.|
|Cross-Hedging||Practice of altering the risk characteristic of a predetermined position in one cash good by taking out a position in a future or forward contract which is based on a good which differs significantly from that of the initial cash position.|
|Current asset||Cash or an item of value expected to be converted into cash within one year or one operating cycle, whichever is longer.|
|Current liability||Accounting term for money payable within the current accounting year, on account of trade creditors, taxation, dividends, etc.|
|Current Yield||A measure of the return to a bondholder calculated as a ratio of the coupon to the market price.|
|Daily margin||The amount that has to be deposited at the Stock Exchange on a daily basis for the purchase or sale of a security.|
|Daily Price Range||The maximum price movement (upward and downward) allowed for a stock in one trading session compared to the previous day’s settlement price.|
|Day Order||An order that is placed for execution if possible, during only one trading session. If the order cannot be executed that day it is automatically cancelled.|
|Debenture||Bonds issued by a company bearing a fixed rate of interest usually payable half yearly on specific dates and principal amount repayable on a particular date on redemption of the debentures.|
|Debtor||A company or individual who owes money.|
|Default||A failure to fulfill an obligation to repay a loan.|
|Delta||The ratio of the change in price of an option to the change in price of the underlying asset.|
|Depository participant||An agent of the depository through which it interfaces with the investor|
|Depreciation||A fall in value of a security or security index or a currency in terms of others or its purchasing power.|
|Derivative||A contract which derives its value from the prices, or index or prices, of underlying securities|
|Discount||When a security is quoted at a price below its nominal or face value, it is said to be at a discount.|
|Diversification||Spreading the risk by constructing a portfolio that contains many different investments whose returns are relatively uncorrelated.|
|Dividend||Payment made to shareholders, usually once or twice a year out of a company’s profit after tax.|
|Dividend Reinvestment||Investing dividend in the scheme itself. Hence instead of receiving dividend, the unit holders receive units.|
|Dividend Yield||Dividend expressed as a percentage of a current share price.|
|Downside risk||An estimate of the amount of loss the holder of a security might suffer if there is a fall in its value.|
|Electronic fund transfer (EFT)||System which utilizes computer and electronic components in order to transfer money or financial assets.|
|Earnings per Share (EPS)||The portion of a company’s profit allocated to each outstanding share of common stock.|
|EBIT||EBIT or operating income is the earnings before interest and taxes|
|EBITDA||EBITDA is the earnings before interest, taxes, depreciation and amortization.|
|Encumbered asset||Asset owned by one party but subject to the legal claims of another party.|
|Equity||The ownership interest in a company of holders of its common and preferred stock.|
|European option||A put or call that can be exercised only on its expiration date.|
|Exchange-Traded Fund (ETF)||A security that tracks an index but has the flexibility of trading like a stock.|
|Ex-Dividend date||The date on or after which the buyer of a security is not entitled to the dividend already declared.|
|Exercise||To put into effect the right (i.e. buy or sell) specified in a contract.|
|Expected return||The return an investor might expect on an investment if the same investment were made many times|
|Expiration Date||The last date on which the holder of the option may exercise it according to its terms|
|Face Value||The value that appears on the face of the scrip, same as nominal or par value of share/debentures.|
|Financial statement||A formal record of the financial activities of a business, person, or other entity.|
|Fixed asset||An item of value used in current operation that would normally be of use for more than one year.|
|Fixed cost||Fixed costs are expenses that have to be paid by a company, independent of any business activity.|
|Fixed Income Security||A fixed income security is an investment that pays regular income in the form of a coupon payment, interest payment or preferred dividend.|
|Fixed interest rate||Interest rate of a loan remains the same for the term of the loan.|
|Float||The number of shares available for trading of a particular stock|
|Floor price||The minimum offer price below which bids cannot be entered.|
|Foreign Institutional Investor (FII)||An institution established or incorporated outside India which proposes to make investment in India in securities.|
|Free cash flow||Calculated by adding depreciation to net income, and subtracting capital expenditures.|
|Fringe benefits||An extra benefit supplementing an employee’s money wage or salary, for example a company car, private health care, etc.|
|Funds of funds||Fund of funds scheme means a mutual fund scheme that invests primarily in other schemes of the same mutual fund or other mutual funds.|
|Futures Contract||An exchange traded contract generally calling for delivery of a specified amount of a particular financial instrument at a fixed date in the future.|
|Golden share||A share with special voting rights that give it peculiar power vis-a-vis other share|
|Government securities||Securities that are sold to the public by the government.|
|Gross||When used in connection with dividend or interest implies amount without any deduction of tax etc.|
|Gross spread||The difference (spread) between a security’s public offering price and the price paid to the issuer by an underwriter.|
|Growth funds||Unit trusts or Mutual Funds which invest with the objective of achieving mostly capital growth rather than income.|
|Growth investing||A strategy whereby an investor seeks out stocks with what they deem good growth potential.|
|Guaranteed Coupon (GTD)||Bonds issued by a subsidiary corporation and guaranteed as to principal and /or interest by the parent corporation.|
|Hedge||An asset, liability or financial commitment that protects against adverse changes in the value of or cash flows from another investment or liability.|
|Hedge fund||Private investment pools that invest aggressively in all types of markets, with managers of the fund receiving a percentage of the investment profits.|
|High-Yield Bond||A bond which pays a high yield because of higher risk of default.|
|Holding Company||A company that holds enough shares of another company to secure voting control.|
|Hot issue||A security that is expected to trade in the after market at a premium over the public offering price.|
|Hypothecation||Pledging assets against a loan.|
|Implied Volatility||The value of the price or rate volatility variable that would equate current option price and fair value.|
|IOC||An order to buy or sell a security that if not immediately filled, will be cancelled.|
|Indexed asset||An indexed asset has coupon and principal payments that are adjusted upward in response to increase in price level.|
|Inflation||A general increase in prices and fall in the purchasing value of money.|
|Initial public offering (IPO)||The first public issue by a public limited company.|
|Interest rate||The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.|
|In the money||A call option is said be in the money when it has a strike price below the current price.|
|Intrinsic Value||Intrinsic value refers to the value of a stock determined through fundamental analysis, by summing the discounted future income generated by the asset to obtain the present value.|
|Investment||Money committed or property acquired for future income.|
|ISIN||A unique identification number allotted for each security in the depository system by SEBI.|
|Issuer||An entity which is in the process of issuing its securities. Also known as the “Originator”.|
|Junk Bonds||High yield bond issued by low rated companies.|
|Jurisdiction||The official authority to make legal decisions and judgements.|
|Know Your Client||Know your customer (KYC) is the process used by a business to verify the identity of their clients.|
|Lagging indicators||Market indicators showing the general direction of the economy and confirming or denying the trend implied by the leading indicators or concurrent indicators.|
|Last Trading Day||The final day when trading may occur in a given futures or option contract month.|
|Leading indicators||Market indicators that signal the state of the economy for the coming months.|
|LEAP||A long-term put or call option (as long as three years).|
|Leveraged Buy Out||The purchase of shares usually by the management of a company using its own assets as collateral for loans provided by banks or insurance company.|
|Limit Order||An order to buy or sell a specified number of shares of a security when a specified price is reached.|
|Liquidation||The process of converting stocks into cash. Also means the dissolution of a company.|
|Lock-In trade||A securities transactions in which all the terms and conditions to the transactions are irrevocably accepted by the buyer and seller.|
|Long Position||A position showing a purchase or a greater number of purchases than sales in anticipation of a rise in prices.|
|LP (Liquidity premium)||Additional return required to compensate investors for purchasing illiquid assets.|
|Maintenance margin||The minimum margin that must be maintained on a futures contract.|
|Margin||An advance payment of a portion of the value of a stock transaction. The amount of credit a broker or lender extends to a customer for stock purchase.|
|Margin Call||A margin call is a brokerage firm’s demand that a margin-account client deposit securities or cash into their account in order to bring the account balance up to the minimum maintenance margin requirement.|
|Mark to Market||The process whereby the book value or collateral value of a security is adjusted to reflect current market value.|
|Market Capitalization||Market capitalization is the aggregate valuation of the company based on its current share price and the total number of outstanding stocks.|
|Maturity||The date on which a loan, bond, or debenture becomes due for payment.|
|Maturity Risk Premium (MRP)||Risk associated with interest rate uncertainty. The longer the time to maturity, the higher the premium.|
|Mid-Cap||Company with market capitalization between USD 2 billion and USD 7 billion.|
|Minimum Price Fluctuation||The minimum price change or tick on a futures contract.|
|Money Market||The market encompassing the trading and issuance of short-term non-equity debt instruments, including treasury bills, commercial paper, bankers’ acceptance, certificates of deposits etc.|
|Moving Average||The average of security or commodity prices over a period of few days or up to several years showing the trends up to the last interval.|
|Mutual Fund||Mutual Fund is a mechanism for pooling the resources by issuing units to the investors and investing funds in securities in accordance with objectives as disclosed in offer document.|
|Naked option||An option that is written without corresponding security or option position as protection in seller’s account.|
|National Securities Depository Limited (NSDL)||This is an organization, which is an intermediary between the Registrar and the company for dematerialisation of shares.|
|Net Asset Value (NAV)||The current market worth of a mutual fund’s share.|
|Net income||Net income is gross income less deductible income-related expenses.|
|Net profit margin||Ratio of operating profits to gross income (or revenue).|
|Net Worth||The difference between a company’s or individuals total assets and its total liabilities.|
|Netting||A system whereby outstanding financial contracts can be settled at a net figure, i.e. receivables are offset against payables to reduce the credit exposure to a counterparty and to minimize settlement risk.|
|Nominee||A person or firm into whose name securities or other properties are transferred in order to facilitate transactions, while leaving the customer as the actual owner.|
|Odd Lot||Anything less than the standard unit of trading.|
|Offer document||As per SEBI DIP guidelines, offer document means Prospectus in case of a public issue or offer for sale and Letter of Offer in case of a rights issue.|
|Offer price||Price at which units in trust can be bought. It often includes an entry fee.|
|Offset||Take a reverse position in option or forward with respect to the one taken in the initiation.|
|Open Interest||The number of contracts outstanding for a given option or futures contract.|
|Open Market Operation||Purchase or sale of government securities by the monetary authorities (RBI in India) to increase or decrease the domestic money supply.|
|Open Order||An order to buy and sell a security that remains in effect until it is either cancelled by the customer or executed.|
|Open-Ended Fund||Open-ended fund is a collective investment scheme which can issue and redeem shares at any time.|
|Operating Cash Flow||Operating cash flow is the cash that a company generates as a result of normal business operations.|
|Option||The contractual right, but not obligation, to buy (call option) or sell (put option) a specified amount of underlying security at a fixed price (strike price) before or at a designated future date.|
|Option Spread||A spread is a type of option position where you buy an option and sell an option and both of them are from the same option class.|
|Order book||It is an ‘electronic book’ that shows the demand for the shares of the company at various prices.|
|Out of the money||An option is described as being out of the money when the current price is below the strike price for call, and above strike price for put.|
|Over-the-Counter Market||A financial transaction that is not made on an organised exchange. Generally the parties must negotiate all the details of each transaction or agree to use simplifying market conventions.|
|P/E||The ratio of the market price of the share to earnings per share.|
|Paid Up capital||The amount of capital, both equity and preference, paid up by the shareholders against the capital subscribed to by them.|
|Paid-in capital||The difference between par or book-keeping, value of a security and the amount realized from the sale or distribution of those shares by the company.|
|Par Value||Means the face value of securities.|
|Partial Fill||An order that trades only part of its total committed volume.|
|Pay In/Pay out||The days on which the members of a Stock Exchange pay or receive the amounts due to them are called pay in or pay out days respectively.|
|Penny Stock||A common stock priced at less than Re. 1 a share.|
|Portfolio||A collection of securities owned by an individual or an institution (such as a mutual fund) that may include stocks, bonds and money market securities.|
|Portfolio Manager||Any person who pursuant to a contract or agreement with a client ,advises or directs or undertakes on behalf of the client (whether as discretionary portfolio manager or otherwise) the management or administration of a portfolio of securities or the funds of the client as the case may be.|
|Position limit||The maximum number of listed option contracts on a single security which can be held by an investor or group of investors acting jointly.|
|Preferred Stock||Owners of this kind of stock are entitled to a fixed dividend to be paid regularly before dividend can be paid on common stock .|
|Premium||If an investor buys a security for a price above its eventual value at maturity he has paid a premium for it.|
|Price Band||The range within which the price of a security or the index of a currency is permitted to move within a given period.|
|Price Rigging||An illegal action performed by a group of conspiring businesses that occurs when the firms agree to artificially inflate prices in an attempt to recognize higher profits at the expense of the consumer.|
|Primary Market||Market of new issues of securities.|
|Profit Margin||After tax earnings divided by sales.|
|Promissory note||A signed document containing a written promise to pay a stated sum to a specified person or the bearer at a specified date or on demand.|
|Put option||An option that gives its holder the right, but not obligation to sell a fixed number of securities at a specified price (the strike price) within a specified period of time.|
|Put call parity||The relationship between the price of a put and price of a call on the same underlying with the same expiration date, which prevents arbitrage opportunities.|
|Put/Call Ratio||The ratio represents a proportion between all the put options and all the call options purchased on any given day.|
|Quote||The last price at which a security or commodity traded, meaning the most recent price on which a buyer and seller agreed and at which some amount of the asset was transacted.|
|Rally||A rally is a period of sustained increases in the prices of stocks, bonds or indexes|
|Rate Of Return||The annual income from an investment expressed as a proportion (usually a percentage) of the original investment.|
|Real-Time Quotes||Real-time quote refers to a quote that is current as of when the quote was displayed.|
|Record Date||A date on which the records of a company are closed for the purpose of determining the stockholders to whom dividends, proxies rights etc., are to be sent.|
|Rematerialisation||The process of converting electronic holdings into physical securities through a Depository Participant.|
|Repo Rate||Repo rate is the rate at which the central bank of a country (RBI in case of India) lends money to commercial banks in the event of any shortfall of funds.|
|Resistance||A chart point or range that caps an increase in the level of a stock or index over a period of time|
|Return||Return is a profit on an investment. It comprises any change in value, and interest or dividends or other such cash flows which the investor receives from the investment.|
|Revenue||The amount of money a company earns through the sale of goods or services|
|Reverse repo||The purchase of securities with an agreement to resell them at a higher price at a specific future date|
|Revolving credit||A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed|
|Rights||A security that lets shareholders purchase additional shares directly from the issuer at a predetermined price.|
|Rights Issue||The issue of new securities to existing shareholders in a fixed ratio to those already held.|
|Risk management||The forecasting and evaluation of financial risks together with the identification of procedures to avoid or minimize their impact.|
|Rolling Agreement||The practice on many stock markets of settling a transaction a fixed number of days after the trade is AGREED.|
|Roll Over||The extension or transfer of a debt or other financial arrangement.|
|Ruling price||The current market price of a security.|
|Savings bank account||Saving accounts are accounts maintained by retail financial institutions that pay interest but cannot be used directly as money in the narrow sense of a medium of exchange (for example, by writing a cheque). These accounts let customers set aside a portion of their liquid assets while earning a monetary return.|
|Secondary market||The market for previously issued securities or financial instruments.|
|Settlement date||The date specified for delivery of securities between securities firms.|
|Short Selling||The sale of a security that is not owned by the seller, or that the seller has borrowed.|
|Special Trading Session||A session during which trading in a listed security is limited to the execution of transactions at a single price.|
|Speculator||Speculators are typically sophisticated, risk-taking investors with expertise in the market(s) in which they are trading and will usually use highly leveraged investments such as futures and options.|
|Spoofing||Placing a limit order at a better price than the current market price for purchase or sale of thinly traded scrips and then endeavouring to cancel the initial limit order in order to induce buy or sell.|
|Spot market||The spot market or cash market is a public financial market in which financial instruments or commodities are traded for immediate delivery.|
|Spread||The spread is the difference between bid and ask prices of a stock.|
|Stop Loss||An order to sell a security when it declines to a specified price.|
|Support Level||An area or price level where a price decline may be expected to be halted (or to slow) by an increase in demand.|
|Swaps||The sale of one security to purchase another with similar features.|
|Swaption||Options on interest rate swaps.|
|Tender Offer||An offer by a company to buy back its specified securities through a letter of offer from the holders of the specified securities of the company.|
|Tick||The minimum upward or downward movement in the price of a security. The term “tick” also refers to the change in the price of a security from trade to trade.|
|Time Value||The portion of an option’s premium that is attributable to the amount of time remaining until the expiration of the option contract.|
|Trade date||The trade date is when an order to purchase, sell or otherwise acquire a security is performed.|
|Treasury bills||A short term bearer discount security issued by governments as a means of financing their cash requirement.|
|Trustee||Legal custodian who looks after all the monies invested in a unit trust or mutual fund.|
|Trend||Either upward or downward movement in price, characterized by a series of higher lows and higher highs (uptrend) or lower highs and lower lows (downtrend).|
|Turnover||The total volume of all transactions executed in a given time period.|
|Under pricing||The pricing of an initial public offering (IPO) below its market value. of securities below their market value.|
|Underlying||The designated financial instrument which must be delivered in completion of an option or futures contract.|
|Underwriter||A financial organization that handles sales of new securities which a company or municipality wishes to sell in order to raise money.|
|Unlisted||A security that is not listed on a stock exchange.|
|Unsystematic risk||A risk that is unique to a company such as a strike, the outcome of unfavourable litigation, or a natural catastrophe.|
|Upside Volume||Upside Volume is the total volume of all advancing stocks over a given time period.|
|Uptick||A transaction in a stock market security above the price of the previous transaction.|
|Valuation||Valuation is the process of estimating what something is worth|
|Value added tax (vat)||A type of consumption tax that is placed on a product whenever value is added at a stage of production and at final sale.|
|Value Investing||The strategy of selecting stocks that trade for less than their intrinsic values.|
|Value Stocks||A stock that tends to trade at a lower price relative to it’s fundamentals (i.e. dividends, earnings, sales, etc.) and thus considered undervalued by avalue investor.|
|Venture capital||It is financial capital provided to early-stage, high-potential, growth startup companies.|
|Vertical equity||A method of collecting income tax in which the taxes paid increase with the amount of earned income.|
|Vertical Spread||In options trading, a vertical spread is an options strategy involving buying and selling of multiple options of the same underlying security, same expiration date, but at different strike prices.|
|Volatility||Volatility is a measure for variation of price of a financial instrument over time.|
|Volume||The number of shares or contracts traded in a security or an entire market during a given period of time.|
|Voting right||The entitlement of a shareholder to exercise vote in the general meeting of a company.|
|Warrant||An options contract often sold with another security.|
|Wolf||Speculators who make a kill in the market.|
|Working Capital||Working capital is obtained by subtracting current laibility from current asset.|
|Worst case scenario loss||The worst case loss of a portfolio would be calculated by valuing the portfolio under several scenarios of changes in the underlying prices and volatility.|
|Writer||Option writer has an obligation to buy or sell the asset (depending upon the type of option), in return of option premium.|
|Yield||The income return on an investment. This refers to the interest or dividends received from a security and is usually expressed annually as a percentage based on the investment’s cost, its current market value or its face value.|
|Yield Curve||It is a curve showing several yields or interest rates across different contract lengths (2 month, 2 year, 20 year, etc…) for a similar debt contract.|
|Yield to Maturity||The rate of return anticipated on a bond if it is held until the maturity date.|
|Zero Coupon Bond||A bond that pays no interest while the investor holds it. It is sold originally at a substantial discount, paying the investor its full face value when it comes due.|
|Zero rate||It refers to goods which are taxable but at a zero rate. The significance of this rating is that businesses selling such goods may claim back their input tax. A term relating to value added tax (VAT).|
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Sales of Mutual Fund Products, FD and Insurance Products.
A Commerce graduate from St Xavier’s College, Kolkata, with a capital market exposure of 40 years, Ramesh Kumar Somani commands great respect for his administrative skills and leadership capabilities. He has been instrumental in transcending and transforming the group into a well-diversified financial services company.
Responsible for the day-to-day operations in relation to risk management, surveillance, and internal control, Rajesh Kumar Somani is actively involved in broadening the Branch and Sub Broker network. Helping clients to sail smoothly through the market volatility is his forte and he assumes a vital role in building and developing strong customer relationships.
A Commerce graduate from St Xavier’s College, Kolkata, Chartered Accountant, Cost Accountant and DBF (ICFAI) with over 24 years of experience, Rakesh Somani provides dynamism and professionalism to the whole group. He was the President of Associations of National Exchanges Members of India (ANMI), Chairman of Asian Forum for Investor Education (AFIE), and member of the Trading Advisory Committee of Bombay Stock Exchange (BSE). He spearheads the DP vertical of the Company and is responsible for Regulatory Compliances and Controlling Finance. He oversees Institutional Business and is responsible for the development and growth of Institutional Clients.
He is a Rank Holder Company Secretary, Chartered Accountant, and commerce graduate from St. Xaviers College, Kolkata. He is the Executive Director of Eureka Stock & Share Broking Services Ltd, with over 12 years of experience in Capital Markets, Bond Markets, and Distribution of various financial products such as Mutual Funds, NPS, Bonds, PMS, Insurance, etc.
He started his career as a Tax Consultant in KPMG, Hyderabad, and thereafter joined Eureka as a Business Analyst. Now he is spearheading Eureka group’s efforts to expand its operations in the Financial Products domain.