PrimeInvestor - Articles and Reports

What’s a corporate action? They include bonuses, stock-splits and buy-backs and are some of the most welcomed corporate actions. Bonus shares are considered as a reward in the form of free shares. Stock splits are generally taken to be a measure to increase the liquidity in a stock. Buy-backs generally happen at a mature stage in the life-cycle of companies when they want to return excess cash. 

You would have heard fund managers talk about following a top-down and bottom-up approach. What are they? How do you use them to filter your stocks and when to use what? This article will try to touch upon some aspects of these approaches to investing, with screeners (from our own Stock Screener tool) that will illustrate and help you understand how to approach these strategies. 

Value investing is often mistaken for buying ‘cheap’ stocks. Therefore, you often simply look for a stock with a low PE ratio, or a low price to book value or with good dividend yield. These are easy ways to assess the relative value of a company. But value investing is not about buying companies that appear cheap based on these parameters. Value investing is a philosophy of buying a company at a price that is lower than its intrinsic value.

What is Sensex, how is it computed and why is it so important? It is highly unlikely that one would go through a stock market related conversation and not hear the word ‘Sensex’. Frequently described as the pulse or a barometer of market sentiment and the economy, which way and how much the Sensex moves, can make or break their day for may.

As an investor, your approach to analysing and choosing banking and finance stocks needs to be distinct too. In the first part of this article, I had dwelt on the CAMEL approach to deep-diving into a bank’s business.

In this article, we’ll explore where risk premiums come from in debt and equity. This is important because risk premiums are not fixed and change with time. So, if you base your return expectations wrong, you may wind up with a different corpus that you originally planned to.