Sub-market Of United Kingdom’S Stock Market

Alternative Investment Market is nothing but the London Stock Exchange has a sub-market which has been constructed to support and offer help to companies that are small start-ups so that they will be able to access funds from the public market. The small companies will be able to list themselves on a public exchange so that they will be able to be allowed to raise funds with the help of AIM which will allow doing so with much bigger regulatory flexibility in comparison to the main market. The companies that are willing to give initial public offering and hence want to list their company on AIM are mostly the companies that are small scale, and they want to do so because they would have spent all the chances of accessing the private capital and therefore are not in the positions to do initial public offering and neither are able to get listed on a big exchange. Read bitcoin profit system review. AIM is nothing but it refers to Alternative Investment Market and sometimes it is even referred to as London’s Alternative Investment Market in the financial news, it has been practiced by London Stock Exchange to refer it by its acronym itself.

Alternative Investment Market in Depth

Although being launched in the year 1995, the AIM possessed about more than 3500 companies by the year 2015. All these companies that AIM obtained were operating in about 100 countries and more throughout the world. During the same year, all these firms were able to raise funds more than 90 billion pounds with the help of AIM, which if we convert into USD will be 140 billion USD. There is maintaining of three indexes by the Financial times stock exchange group in order to track the AIM. The three indexes are as follows:

  1. The FTSE AIM 100 Index
  2. The FTSE AIM UK 50 Index
  3. The FTSE AIM All-Share Index.

The relationship between AIM and the Nomads

For the companies to be listed on AIM the process that the company has to follow is the same as the traditional IPO. The only thing that is different is there are fewer conditions required. However, there is still a blitz known as pre-IPO marketing along with the financial information’s history so that the interested can be blended and there is a post-IPO lock up as well. For instance, there is a role known as nominee advisors who are known by the name ‘nomads, which is the main difference in this process. The nomads are nothing but the regulatory systems for AIM and their work is to do the following things:

  • The advice for the pre-IPO is given to the company
  • For the investors who are expecting to assess the prospectus, the due diligence is carried out by nomads.

However, this relationship between the AIM and the nomads is arguable because as in spite of nomads being the regulatory system they still make some amount of profits from the company that they are listing for in the form of fees. This has led to a lot of arguments since it is against the listing agreement.

Analysing Pros and Cons Of Cryptocurrency And Forex Investments

 

In today’s competitive and technologically driven environment, a very large number of people are involved in investing their finances in different ventures to gain maximum profits out of them. Two of these most popular ventures in all parts of the world currently is Forex and cryptocurrency. These two primary modes of investment can include arbitrage, short-term trade approaches, and long-term investment ideas. However, it gets really important for all of us to understand the fact that there is a huge difference between these two markets and they have their own advantages and drawbacks. They are individually unique, have separate features, and their way of offering profits and transactions are also contradicting to each other.

So, if you were trying to understand what the basic differences and individual features of these two modes of financial investments, then this compilation is perfect for you.

Understanding cryptocurrency

Cryptocurrency is basically digital currency that functions as an entity online and has no physical presence. It has taken over the financial market tremendously and has been serving as a good investment alternative for a really long time now.

Let’s understand what the features of the cryptocurrency are and also what the related disadvantages are.

Pros-

The main feature of cryptocurrencies is that they are volatile in nature. It means that its value keeps fluctuating from time to time, generally bringing in increases in its value.

The costing of carrying out these types of investments and then transactions are limited. This implies that there are no hidden broker fee and all.

Easy access to Bitcoins and other booming cryptocurrencies is one of the most beneficial features of the digital currency. As they are simply available online, all you need is capital, a computer or smartphone and a reliable online crypto broker.

Cons-

It is very much possible that your wallet accounts in which you store your cryptocurrencies get hacked. This increases the risk factor.

Since the entire functioning of cryptocurrency is based on the blockchain, any disruptions or discrepancy in the network can hamper your investment process.

Since the majority of the countries have not declared it as a legal tender yet, it might get difficult to exchange it for goods and services.

Understanding Forex

Forex is basically the exchange of foreign currency among nations. Some of the most prominent characteristics of this field that serve as benefits and drawbacks to the users are listed below.

Pros-

The market is quite deep and intense as multiple currencies are involved in it. This increases the opportunity of exploring and making profits.

Since the values of currencies do not fluctuate too heavily, this is a very stable form of investment.

Brokerage is not much as compared to other investment platforms.

Cons-

Additional and heavy costs might be included in the name of the fee, ask spread and rollover.

Since the whole concept is driven by brokers, there is very less transparency in the system.

Here, all the traders and investors have to be on their own as they are provided with very less or even no guidance from professionals working in this field.

Therefore, despite using the same Internet medium, the size and features of Forex and cryptocurrencies vary a lot. You need to choose wisely between the two and go for something or maybe both when you are convinced with the concept and are sure of the requirements.

A Brief On Investment Plans And Options Benefits Associated With Mutual Funds

 

There are a variety of plans and options to choose for investing in mutual funds and this include

  • Direct type of plan: Here the investor can directly deposit with any fund house where no external helpers are involved and thereby save intermediate unnecessary charges. Their pre-fixed NAV charges are a little higher in value as they offer lower initial expenses.
  • Normal or Regular Type of plan: For registering and depositing with such plans, you need to initially invest through the respective external agent and then make use of their services. Their NAV is much lower compare to direct type.
  • Growth kind of option: This particular type appreciates capitals without paying the dividends to its unit-holders but by constantly investing this income into the prevailing scheme and reflecting out the higher value in the NAV of the units under this option. Further, investors can enjoy these benefits through the process of redeeming them.
  • Payout Options in the form of dividends: This option promotes the payment of dividends to its respective unit-holders. Accordingly, there is a chance of falling NAV value which is fully dependent on the extent of the dividend paid out.
  • Re-investment Option on the dividends: There exists some kind of dividends that add-on units under options. Such dividends need to be invested back into the same scheme at tallied at the ex-dividend NAV. The advantage of this practice is that each investor receives an extra bunch of units on their investments in lieu of the dividends.

Benefits offered by mutual fund

  • Small entry investors can really look forward to mutual funds for the need of effectively and professionally handling their money.
  • It gives the natural advantage of enjoying the economies of scale and also the access to different level markets.
  • It provides the entry to a pool of companies and sectors shares and thereby taking our portfolio to acquire those assets, which are otherwise expensive.
  • Moreover, it offers liquidity and flexibility by providing diversity in its schemes.
  • Apart from all this, it offers the advantage of a convenient, transparent and above all a well-regulated system.

Usually, people do experience a factor of fear while deciding on making investments. This is mainly due to the lack of knowledge about the particular investment scheme opportunities and the doubts regarding the financial know-how. Further, some financial markets exhibit abrupt behavior that may act as a barrier for many entry investors.However, the rise of mutual funds with its plethora of schemes structures have comfort almost all its users and has gained acceptance all over the world and now, it is a fact that the benefits offered by them clearly outweighs its shortcomings.

Reasons For Mergers And Acquisition

There are a number of incidents when we come to know about a well-known company suddenly not in the market anymore, or it has been taken over by another giant from the same industry or it has been merged with a better functioning company. All the possibilities happen for a cause and due to some reasons. Let us take a better look at why such M&A takes place.

Therefore the mergers and acquisitions are aimed at some certain factors which the company cannot attain when they are single. The economic reasons for this decision are:

  1. Increased Capabilities: when a company wants to follow better techniques in any function, it will decide to buy another well-functioning company in this area rather than allocating huge funds to build such processes.

  2. Similarly, when they want better and more clear method of manufacturing they buy the subsidiaries which are specialized in the same.so for making more profits the companies either buy a new company or take over a new one.

  3. Gaining competitive advantage: in order to acquire a larger and better market share a company takes over a company which has got a wide market share and is flourished with many customers.

  4. This is easier rather than building the market share of the target customers from scratch.it involves a lot of time and cost too. Hence this is a solution make global M & A’s in the same industry and capture a huge consumer range.

  5. Products and services diversification: when a company wants to specialize and deal with new products or service they can combine with successful ones in the same industry and get the benefit of the new amalgamation.

  6. This helps in improving the profits and also in imbibing new technology facilitation. But this type of a merger will require some legal regulations to be followed so that the business doesn’t become a monopoly in that sector.

  7. Better leadership: when a company wants a new and competent leader and none of the employees in the company don’t qualify with their capabilities then it is better to find from other companies or entirely merge with ones where there is high and skilled leadership proficiency.

  8. Cost cutting: for meeting the vision of better profits with minimum resource utility is the aim of every organization. Similarly, the best opportunity to amalgamate with companies which are flourished well in the industry can be an easy way to gain profits easily.

So it very clear that many companies want to benefit from one or the other new reasons which other companies already possess and both together work for better profits.

 

Learn How To Use A Payment Interface For Mutual Fund Payments

Digital payments have become part and parcel of life for every foot forward in life. Be it grocery shopping, movie tickets or bank transactions worth big bucks. Payments through the internet like cards, internet banking, and POS machines are as easy as getting bus tickets now. Therefore, it becomes another casual affair to use the internet for paying mutual funds. One of the latest payment bandwagons to join the growing gateways is the UPI or Unified Payments Interface.

Another realm of internet banking

There is no increased complexity like the upgraded name suggests in UPI. It is just another tributary of Internet banking, where you are making your mutual fund investments, but without opening an internet banking account. It is raining apps and stock market activities are simply cashing in on the use of technology. UPI also does the same, it is a smartphone app can be conveniently installed on your mobile and used through your personal Virtual Payment Address (VPA). Advanced technology aids here for your convenience, an interactive software has been created, which intelligently and consciously taps the instructions from the user and carries out the action.

For investing money using interface apps, the below listed three quick steps will do the trick:

  1. Install the app on your mobile, by selecting the compatible version. There are separate versions for androids and iOS mobiles.
  2. Create your own VPA and attach it to your smartphone.
  3. Link your phone to the bank account and the VPA gets attached to it. Start your smart investment by activating the VPA.

Yes, this is as simple as entering your office by swapping your Identity Card. Your VPA is the ID card here. Visit the official website of the mutual fund where you want to invest, and after you have made all the selections regarding the scheme, choose the app as the payment mode and give the VPA. The rest is done like a transparent and secure bank transfer.

What are the additional benefits of using Interface payment mode?

Internet banking facilities like NEFT and RTGS are almost dominating the online transactions, but have certain limitations with regard to restrictions in the timing and amount. Plus, unless you give a standing instruction for automatic payments, you have to manually login with a secure and stable internet connection every time.

With the new interface app, you can transmit money in a single click on your mobile, without patient logging in, detail filling and transmitting, once the initial registration is done. It gives:

  • Quick and instantaneous payment any time during the 24 hours.
  • Privacy of financial and personal details.
  • Facility to do multiple transactions without restriction to the amount.

When are you making your smart investment for a sure bonus?

 

What is Fintech and why the entrepreneurs must know it!

This word keeps thrown up all the time:

Whether you are in the corporate circles or at networking parties, one word that most often gets thrown in or rather thrown up in an argument is ‘Fintech’. While Fintech is a combination of the two words finance and technology, a lot of people do not quite understand what it means and what implication it has on the society that we live in.

Tech gurus at it:

A lot of the financial and tech gurus have written elaborately about how the evolving technologies in our society have evolved our society to be what it is and some of them like Jens Munch are also disappointed that even after having gigantic investments by world leaders in this field, a lot of people still do not understand the actual meaning of the word.

He in his Forbes article argues prolifically that in spite of global investment of more than $20 billion today; the word is randomly used and interchangeably used for simpler processes thereby diluting its impact on the corporate environment. Why there is also no mention of this word even in the Oxford dictionary yet!

So, what exactly is Fintech?

In the layman’s terms, the definition of Fintech is and I quote Fintech is usually applied to the segment of the technology start up a scene that is disrupting other sectors such as mobile payments, money transfers, loans, fundraising and even asset management unquote.

As of today, there is a great demand for newer technology talent in the first world countries where they are of the categorical viewpoint that if they have to stay ahead in the rat race with the other powerful nations of the world, they need to evolve better and stronger technologies so that the society can progress and not witness any meltdown.

Almost all the countries of the world realize the potential:

While all the countries of the world are running their own race, Europe has clocked in the highest global investment in this sector and continues to be the pioneer with a growth spike that is curved upwards and is increasing in a few hundred percents every year.

What is adding to the increase in such growth is:

  1. An associate network of regulations in the field of finance;
  2. Newer innovations and
  3. Enlightened consumer behavior.

 

Today, various countries of the world and especially the financial capitals of the world make sure that they invest adequately in technology related to finance and its various processes because they know for sure the change that is heralded and what the future looks like!

Some Important Tips For Business Valuation For The Buyers

Business valuation is usually done by a professional assessor and even then some important aspects might escape the notice of buyer and assessor. These could be minor details or may affect the entire value of the business. If you are a buyer, then you should understand these aspects very well even if you entrust the responsibility of assessment to some reputable company.

  1. Profit and earning, are two terms that need to be understood clearly. The amount you are going to spend in buying a company should get you an equal or more in terms of earning, as opposed to being invested in some banks or put in some other kind of investments. For example, a company may make a profit and bring back the entire investment made by you in six years. Then you need to calculate how much can the same investment earn in some other avenue, and compare the two amounts. This will help you to make a decision.
  2. Adjusted profits should be carefully calculated. For example, you may see a decent amount of profits in the books and later if you find that the owner did not take any money as salary, then if the amount of wages is adjusted the profit is bound to go down.
  3. Some years and periods may be very good for certain businesses and periodically the profits may increase or decrease. So you need to ensure that you understand the situations and conditions that lead to these fluctuations.
  4. While calculating profits, ensure to incorporate all important aspects like EBITDA and EBIT etc. Once the company is bought or merged with another company, the tax structure will change completely. Therefore, the amount of profit has to be clearly defined before and after the taxes and other deductions.
  5. The opportunity cost needs to be calculated when the company is being assessed through a discounted cash flow system.
  6. Consider the cash surplus and any long-term debt. These should be clearly defined and mentioned in the valuation so that the buyer offers a price that includes these values.

Another important factor to consider is goodwill. This is not a measurable quantity but does help the assessor to evaluate the entire business and its reputation in the market as a complete package with its other tangible assets. At times the goodwill may be negative even when the tangible assets are in good shape. The real price of any business is actually how much do you want to pay for it. So use a reputable appraiser and a combination of methods. Once you get the worth of the business, in monetary terms, they understand the values and use your own judgment as well.

Choices galore when choosing a mutual fund

The investor is spoilt for choice:

It happens often that when an investor is still reading and deliberating and trying to find out for himself what kind of investment in mutual funds he is looking out for that he is bound to get carried away by the sheer number of options that he has at his disposal. So, while it is one of the main reasons why people across the industries flock to invest their money in mutual funds, it is also a big reason why such people are always confused what option to choose for themselves or even if the option that they have chosen is the right one for them.

To opt for a growth fund or a dividend reinvestment fund?

The biggest dilemma that people nowadays feel is whether they should invest in a fund that has the growth option or a fund that allows for dividend reinvestment into the fund. It is the right thing to say that both of the approaches have their own set of advantages and disadvantage. What then can be a determinant is what the investor knows what will be most ideal scheme for him that will it help him realize the financial gains that he is looking to make.

What do the two options mean in brief?

  1. The growth option for mutual funds:

A lot of companies where the funds are invested call out dividends. When an investor decides to opt for a growth fund, the dividend automatically gets added to the existing fund and increases the Net Asset Value of the fund. In this case, also the number of shares does not increase per se but the value of the holding increases.

  1. Dividend reinvestment mutual funds:

This is mostly offered as a free service by the mutual fund companies. In this case, the dividends are not really paid out in cash to the investor but they are reinvested in other companies. In this option, the number of the shareholding of the person increases.

At any point in time, however, the investor can opt out of the above two options and ask for a payment of dividend into his account. The following three methods are generally used by the MF companies in paying out the investor his dividends if he chooses to:

  1. Directly paid into the shareholder’s account;
  2. Electronically transferred to his account and
  3. Sent physically via mailers as a cheque to the address furnished by the investor himself.

What is the bottom line?

In the end, it is noteworthy to say that there is no mutual fund that is perfect. A mutual fund that is best to the investor’s present financial status and meets his future medium and long-term goals is what he must look at in order to choose what will be best for him in the long run.

Inflation Affects The Confidence Of People

People see the periodical changes in the prices of goods and wonder how the economy and their lives are affected by inflation. There are many plans that they make for their families and retirement, which may need to be reviewed every time the inflation increases drastically. The experts feel that inflation, at least a little bit of it is good for the economy, but what do people feel about it when they find many things out of their reach? Of course, disheartened and unhappy. So let us see how inflation affects people and society.

  1. The most important aspect is that; it reduces the purchasing power of people. The essentials will still be purchased, like food and healthcare. But the other goods and services may see a decline in their sales, which are considered non-essential.
  2. It is a contradictory scenario. People will see that the value of money is decreasing so some of them will also try to buy in bulk and hoard for future. This may include people buying non-perishable goods like clothes and shoes for their children in future sizes.
  3. Many people try to invest in gold and other high-interest instruments to create a better corpus of funds and this may or may not work with the value of money going down with increasing inflation. With the purchasing power going down you do not really know whether your investment will appreciate or depreciate. People who bought shares in Apple or IT companies made huge profits; however, some companies went bankrupt.
  4. The spending and investing may increase the inflation further. With hoarding, stores become emptier and more people start buying out of sheer anxiety. This may further increase the costs and prices. On the other hand, the available money in the market starts decreasing as people invest that or heard that. The government may be forced to print more currency and then inflation goes up as the money is further devalued. This vicious cycle goes on.
  5. The governments try to increase interest rates so that people borrow less money and this works two ways. People may borrow less of the interest is higher than the inflation. The money is scarce and it would make sense to save and spend wisely. But if the interest rate is lower than the inflation then people would not mind borrowing more and use the money now than wait for it to lose its value.

We can see that inflation is not really easy to comprehend and yet it is an integral part of our lives. It affects people’s confidence as it is difficult to understand whether to save or spend or borrow every time there is some fluctuation.

 

The case for financial modeling as an important management tool

 

Financial modeling is pertinent in an organization:

If you ask me today what skill in the corporate world is most sought after, I would not even take a minute more to tell you that it is the skill of financial modeling. It has over the past five years assumed so much importance because it has the ability to be able to analyze what is not just seen coming but also to be able to make the organization ready for any kind of eventualities.

Financial modeling in a nutshell:

In the simplest of terms, financial modeling can be explained to be an art (or perhaps a science!) of building such dynamic tools that can be useful in predicting future changes and evaluating corporate investment opportunities. It can help in anticipating the strengths and the weaknesses of a corporate and aid it in mergers and acquisitions, raising capital of the company, etc.

Financial modeling has been a pivotal tool in helping to assess a company history and be able to forecast its performance in terms of its finance, its organizational skills and various other departments therein.

The significance of financial modeling:

Companies often lose out on capitalizing on important occasions because of the doubts that they have on their organizational processes. These doubts can be abysmal. A financial analyst who can use his financial modeling skills to the hilt can help the top and the middle management of the organisation analyze the various possibilities in a given business scenario and help take a decision that will ensure that there is minimal risk and a maximum output may be in terms of sales or production or whatever it is that the company specializes in.

Here is a list of applications of financial modeling:

  1. Financial modeling is an effective management tool that can help arrive at game-changing decisions in the most cost-effective way;
  2. It has often been called as the proactive approach of making a creative representation of the corporate status quo;
  3. It is the mathematical representation of the economic performance of the company and is extremely helpful as a tool for analysis and appraisal of the company’s rules and policies.

An indispensable tool in decision making:

Financial modeling as such is used across the board in industries such as investment banks, credit rating agencies, equity research, mutual fund companies, financial outsourcing companies, project financing companies, etc.

I cannot stress its importance enough. A candidate with the requisite skills of modeling stands a much better chance at grabbing a great opportunity than the one without such a set of skills.