Definition Straight debt, also known as a plain vanilla bond, is the simplest type of debt finance that a company can obtain. Straight debt bears fixed interest regularly at pre-determined points in time. Straight debt is paid to companies by investors or institutions for a set amount of time. During this time, the investors receive …
What is Straight Debt? Definition, Example, Components, And More Read More »
Definition Cost of Equity can be defined as the company’s cost to raise finances from selling equity. In other words, the cost of equity can be defined as the rate of return that the company pays to equity investors. The cost of Equity is mainly used to assess the overall attractiveness of investments. This includes …
Cost of Equity: How To Calculate? (With Analysis) Read More »
Cost of Equity is the return that equity stockholders expect from the company or the rate of return a company pays out to its equity stockholders. Investors use the Cost of Equity to determine the rate of return they will receive from the stock. It is important for investors to know the Cost of Equity …
Cost of Equity: Formulas, Calculation, Advantages, and Disadvantages Read More »
A company can finance its activities through either equity finance or debt finance or both. The combination of equity finance and long-term debt finance that a company uses is known as its capital structure. Equity finance can include instruments such as share capital, preference share capital, retained earnings, etc. while debt finance can include loans, …
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The money market is the place where the purchase and sale of large volumes of short-term debt products take place. The main transactions of the money market are wholesale transactions between financial institutions and companies. It plays an important role in the global financial system by enabling economic units to manage their liquidity position. Money …
Investors looking to invest in a company’s stock can find the price of the stock in the stock market. Stock markets such as the New York Stock Exchange (NYSE), London Stock Exchange, NASDAQ etc. all deal in thousands of companies’ stocks. There are millions of transactions around the world’s stock exchanges every day. An investor …
How to calculate the fair value of a stock? Detail Explanation Read More »
Overview Companies can decide to increase the number of outstanding shares while simultaneously decreasing the nominal share price proportionately. A stock split is a corporate procedure that increases or decreases a corporate’s total number of shares outstanding without changing the firm’s market value or the proportionate ownership interest of existing shareholders. The total value of …
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Definition: Bonus shares are additional shares given to the existing shareholders in proportion to the shares they already hold. Bonus shares are given based upon the number of shares that a shareholder owns without any additional cost. Sometimes, the company may decide to give bonus shares in the form of dividends. When companies are short …
Bonus Issue of Shares: Definition, Effect, Accounting, Advantages Read More »
The share issue is the method of offering securities to raise funds from investors. Companies use various methods of issuing shares. 7 methods of issuing shares are described below: 1) Public Offering A public offering known as Initial Public Offer (IPO) involves a company inviting the general public to subscribe to or purchase its shares. …
7 Methods of Issuing Shares ( Example and Explanation) Read More »
