Net profit margin is calculated to know how much net income or profit is generated by the company as a percentage of revenue for a period. It's part of profitability ratios used by financial analysts to analyse a company’s income statement. You can present net profit margin in decimal form instead of showing as a percentage of revenue. If a financial analyst wants to know … [Read more...] about How net profit margin is used to analyse companies profitability
Finance
Bottom-Line vs. Top-Line: What’s the Difference?
On the company's income statement, top line and bottom line are the two most important lines that investors and analysts pay particular attention to. Income statement is one of the three most important financial statements reported by the company to let the stakeholders know the company's financial performance over a specific accounting period, which is typically for a … [Read more...] about Bottom-Line vs. Top-Line: What’s the Difference?
Relative price strength: How a stock is performing
Relative price strength (RPS) is a strategy used in technical analysis in identifying value stocks. RPS is also known as relative strength. In relative strength strategy, market participants compare the price trend of a stock in comparison to the price trend of the market or other stocks. In other words, they compare performance of two securities, or a security and an index, … [Read more...] about Relative price strength: How a stock is performing
Price to Sales Ratio: Is it the king of the value factors
In one of our earlier articles, we have discussed the price to earnings ratio, which is popularly known as P/E ratio or P/E multiple. In this article, we will tell you how to calculate price to sales ratio, and whether it is considered as the king of the value factors. The price to sales ratio is used as a profitability analysis tool to discover undervalued and overvalued … [Read more...] about Price to Sales Ratio: Is it the king of the value factors
How to pledge your shares to increase margin limit
If you have purchased a few shares after selling your position on the same day, then in the absence of adequate funds, your broker might ask you to pledge shares. They will initiate a request to pledge shares or provide adequate funds. You will receive a link from the depositories (CDSL/NSDL) to authenticate the request on your registered email ID and SMS on the … [Read more...] about How to pledge your shares to increase margin limit
How does supply and demand affect stocks
Cause and effect analysis is one of the oldest ways to analyse What causes prices to move? If you understand the cause then only it will be easier to understand the reality of the stock market. Supply and Demand is the main cause why the share market moves up and down. Professional technical analysts suggest that a better way to trade is to understand the cause of price … [Read more...] about How does supply and demand affect stocks
Fees, Charges, and Taxes on Stock trading – Explained
When you trade in a stock exchange through a broker, the money that you need to pay is made up of two components-the price of the stock and the fee charged by the intermediary. We have a number of charges and taxes levied on trading in the stock market. Every stock broker is different when it comes to what fees they charge to trade in the stock market. Being aware of these … [Read more...] about Fees, Charges, and Taxes on Stock trading – Explained
How Good Till Triggered (GTT) orders work in the stock exchange
You might have heard about GTC orders in the stock market. Good till cancelled (GTC) orders are valid till it is cancelled. These types of orders are basically used to place long term stop-loss and target order in a trading platform. In India, our stock exchanges do not support GTC orders. In India, all the pending orders will be cancelled at the end of the trading session. … [Read more...] about How Good Till Triggered (GTT) orders work in the stock exchange
Brokerage charges levied by discount stock brokers in India
Trading in the stock market is associated with various charges, including brokerage charges and securities transaction tax (STT). Knowing how these charges are levied will help you to plan your trade in advance. Before getting into brokerage charges let us understand who charges you brokerage fee and why. Brokerage fee is charged to you by a broker through whom you trade … [Read more...] about Brokerage charges levied by discount stock brokers in India
What are DP or Demat transaction charges in the stock market
DP or demat transaction charges are levied by your stock broker when you sell stocks from your demat account maintained with a depository. A depository is an institution/organization which holds securities with it in Demat form. In India we have two depositories, CDSL (Central Depository Securities Limited) and NSDL (National Securities Depository Limited). These … [Read more...] about What are DP or Demat transaction charges in the stock market