Fri, 06 Jul 2018 12:43 IST
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What Is Time Value Of Money

While dealing with money we are fixated on the amount of dollars that we earn or spend. However, investing professionals realize that the number of dollars that can be used to buy a product only matter. For example:  Let’s say you have a $100 bill in your pocket. There are really two things … [Read more...]

Leverage – The Missing Piece

Galileo once said that he could move the earth with a single hand, if he could find a lever big enough to do it. Levers are powerful in science as well as in finance. However, in science you can control the environment to ensure that the lever doesn’t work against you. In finance, sadly that is … [Read more...]

Undisclosed Requirements While Getting Payday Loans

Getting payday loans in a fast and hassle free is the primary concern of the borrower. Many will just overlook the interest rates and the exorbitant cost in the favour of faster service. The amount of documents required to get a payday loan processed is a good indicator of how detailed their process … [Read more...]

Processing Fee In Payday Loans

Processing fee is the single biggest reason for the payday lending industry to come under immense criticism. Most critics feel that charging a processing fee as high as the payday lenders is predatory lending. This has only helped cement the reputation of payday lenders as modern day loan sharks. What … [Read more...]

Mental Accounts

The text book says that all money is fungible i.e. any one dollar bill is as good as any other one dollar bill. However, in practice, people do not believe in accordance with this principle. There are countless people in the US who have a credit card debt at 20%, though at the same time they save money … [Read more...]

Introduction To Time Value Of Money

Every investor calls it suicidal to put your foot inside the investing game without understanding the Time Value Of Money. On the contrary, every layman believes that investing is somehow about number crunching. People who have the skill to read the numbers are likely to predict the markets and make … [Read more...]

How Are Investing Decisions Made

Traditional theories suggest that investors are perfect in making investment decisions and can make no mistake at all. However, behavioral finance discusses the ways in which investing decisions are made. We make decisions based on emotions:  Behavioral scientists, after conducting several experiments … [Read more...]

Loss Aversion

Loss aversion is one of the biggest psychological effects that players in the stock market experience. To have a better understanding of behavioral finance, it is essential that one knows about loss aversion. The theory is as follows: What Is Loss Aversion? Would you like to double your income with … [Read more...]

Heuristics

Mainstream financial theory supposes that investors make calculated decisions when it comes to investing. However, in reality, there is very little time that an investor gets to process the information, make sense out of it and take the decision. An average mind is not particularly good at statistics. … [Read more...]

Herding Instinct

What Is The Herding Instinct? Herding instinct is the tendency of an individual to take decisions which may be against his/her personal belief just to confirm with the crowd sentiment at that a given point of time. This kind of behavior is observed in the markets as bull runs and bear crashes happen … [Read more...]