Meaning & Definition

common stock

Common Stock

What are Common Stocks? Common stock, also known as ordinary shares or common shares, is a security that reflects the investor's ownership of a company. Holding this stock offers investors the power to elect the company's board of directors and...

equity share capital

Equity Share Capital

The total amount of equity shares associated with ownership of the company is the equity share capital. The equity share capital is also the difference between the total assets owned by the company minus all the liabilities on the balance sheet.

liquidity trap

Liquidity Trap

What is Liquidity Trap? In economics, liquidity means a state of having more cash. While liquidity trap means a situation where too much cash circulating in the economy becomes a problem. Here, cash does not mean physical cash. It refers...

muncipal bonds in india

Municipal Bonds in India

Municipal bonds are also known as ‘muni bonds’. It is a debt instrument that municipal corporations and other associated bodies in India issue them. Whenever the local government body wants to raise funds, they issue these bonds.

price to earnings ratio

Price to Earnings (P/E) Ratio

The Price to Earnings Ratio or P/E Ratio is the most popular metric for analysing the company's valuation. In addition to showing whether the company is undervalued or overvalued, this valuation ratio helps to understand the company's financial health compared...

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price to book ratio

Price to Book (P/B) Ratio

There are so many companies listed on the stock market. But it gets very challenging for an investor to select which company to invest in. You need not rely on your instinct to invest. Still, you can go about it...

draft red herring prospectus

Draft Red Herring Prospectus

What is Draft Red Herring Prospectus? A Draft Red Herring Prospectus (DRHP) is an 'offer document' or 'preliminary registration document' that a company files with the Securities and Exchange Board of India (SEBI). The document introduces a new business or...

red herring prospectus

Red Herring Prospectus (RHP)

What is Red Herring Prospectus? As per the Securities and Exchange Board of India’s (SEBI) mandate, all companies going public (for an initial public offering (IPO)) must disclose certain facts regarding their business, finances, promoters, risks, the objective of IPO...