'''First, some definitions''' The debt market is the market where debt instruments are traded. Debt instruments are assets that require a fixed payment to the holder, usually with interest. Examples of debt instruments include bonds (government or corporate) and mortgages. The equity market (often referred to as the Stock Market) is the market for trading equity instruments. Stocks are securities that are a claim on the earnings and assets of a corporation (Mishkin 1998). An example of an equity instrument would be common stock shares, such as those traded on the New York Stock Exchange. '''How are debt instruments different from equity instruments?''' There are important differences between stocks and bonds. Let me highlight several of them: # Equity financing allows a company to acquire funds (often for investment) without incurring debt. On the other hand, issuing a bond does increase the debt burden of the bond issuer because contractual interest payments must be paid- unlike dividends, they cannot be reduced or suspended.
# Those who purchase equity instruments (stocks) gain ownership of the business whose shares they hold (in other words, they gain the right to vote on the issues important to the firm). In addition, equity holders have claims on the future earnings of the firm.
In contrast, bondholders do not gain ownership in the business or have any claims to the future profits of the borrower. The borrower's only obligation is to repay the loan with interest.
# Bonds are considered to be less risky investments for at least two reasons. First, bond market returns are less volatile than stock market returns. Second, should the company run into trouble, bondholders are paid first, before other expenses are paid. Shareholders are less likely to receive any compensation in this scenario.
1. Equity Market 2. Debt market
Wholesale Debt Market
They're satins babies, he wants people to be miseable in debt.
goal is open ended statement which an organisation want to accomplish without time and quantity. objective is with time and quantity Goals are broad measures of achievement. Objectives are quantitative or qualitative steps that will lead to an overall goal achievement. Example: I have a goal to reduce my credit card debt. My first objective is to make double payments on my gas card to pay it off in 2 months.
Strengths * Cost advantage * Asset leverage * Effective communication * High R&D * Innovation * Online growth * Loyal customers * Market share leadership * Strong management team * Strong brand equity * Strong financial position * Supply chain * Pricing * Real estate * Reputation management * Unique products Weaknesses * Bad communication * Diseconomies to scale * Over leveraged fiancial position * Low R&D * Low market share * No online presence * Not innovative * Not diversified * Poor supply chain * Weak management team * Weak real estate * Weak, damaged brand * Ubiquitiouegory, products, services Opportunities * Acquisitions * Asset leverage * Financial markets (raise money through debt, etc) * Emerging markets and expansion abroad * Innovation * Online * Product and services expansion * Takeovers Threats * Competition * Cheaper technology * Economic slowdown * External changes (government, politics, taxes, etc) * Exchange rate fluctuations * Lower cost competitors or imports * Maturing categories, products, or services * Price wars * Product substitution
Equity is bought and sold in the stock marketwhile debt is bought and sold in the bond market.
Equity is bought and sold in the stock market while debt is bought and sold in the bond market.
return on capital employed (ROCE) is net income/(debt&equity) whereas return on equity is income/equity (without debt).
Market debt ratio= TL / (TL - Equity) Note : equity with market value .
1. Equity Market 2. Debt market
Equity Capital Market, Debt Capital Market
The debt market is the market where debt instruments are traded. Debt instruments are assets that require a fixed payment to the holder, usually with interest. Examples of debt instruments include bonds (government or corporate) and mortgages. The equity market (often referred to as the stock market) is the market for trading equity instruments. BYSOS - India's Foremost Online Stock Fantasy Gaming Platform. bysos.in
Capital market is a market for long-term debt and equity shares. In this market, the capital funds comprising of both equity and debt are issued and traded. This also includes private placement sources of debt and equity as well as organized markets like stock exchanges. Capital market includes financial instruments with more than one year maturity.
similarities between equity n debt finance
Equity is the proportion of those assets you own, compared to the debt on those assets. An example would be a house. A house is an asset. The equity is the amount of the mortgage that is paid off plus any appreciation the value of the house. Same with a company. Its the difference between what you own and the debt or liabilities. Assets minus liabilities equals equity. You have equity in assets.
Bondholders own a share of the debt of a company. Stockholders own a share of the equity of a company.
Equity shares are long term instruments and hence can not be a money market instrument. They are traded in a market known as stock market. The equity segment of the exchange is different from other markets such as debt market and money markets.