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Dear All

StockMarketModelStreet is the main product in your line of purchase, which is definitely priced on the higher end.

Would be a suitable product for those equally inclined to learn more about the stock markets.

For those who would want to take up our other modules slightly priced lower within a price range of 25,000-35000 INR +taxes.

You can always drop us a mail for appointments for consultation pertaining to the subscriptions for the aforesaid modules.

If you want to directly purchase the module from our website you can as well subscribe to the same.

Special words to our patrons please do follow our blog, our company page for updates , categories & suggestions.

Hindsight Bias – continued

Hindsight bias, also known as the knew-it-all-along effect or creeping determinism, is the inclination, after an event has occurred, to see the event as having been predictable, despite there having been little or no objective basis for predicting it.

Abstract

Traditional accounts of “hindsight bias” inadequately distinguish “primary” hindsight bias from both “secondary” and “tertiary” hindsight bias. A subject exhibits primary bias when she assigns a higher ex ante probability estimate to actual outcomes, secondary bias when she believes that she herself would have made the same estimate of the prior probability of an event before receiving outcome information as she made after receiving it, and tertiary bias when she believes that third parties lacking outcome information were unreasonable if they did not make the same prior probability judgments that subjects now possessing such information make.

In our experiments, we find that when people can readily calculate the actual ex ante probability of an outcome, they don’t reassess that probability when told what outcomes actually occurred. They reassess only in situations in which they are unable to assess prior probabilities or when given information that the outcome was not simply a result of sampling or chance but the result of an imperceptible feature of the initial situation. Observed primary bias may therefore often be rational.

Capital Style

WE can take capital or the very word capital’s dichotomy can be understood as capping the little.

Capital = Working capital+ FIxed Capital or the industrial capital, this term industrial capital can be widely understood to be the market capitalisation or the market share ;specific or as a whole.

Capital Style when taken to be in different contexts as the base & lift off as the predicaments or presuppossitions rather than as assumptions or presumptions.

Presumptious ; when taken as the capital style , is more taken to be rather than processed as a system.

Capital style as taken to be decisive to approach the indecisiveness , indecisiveness being on the humane side or error presupposed directly categorizing it into the very section of Behavioural Finance than behavioural economics. Behavioural finance is the study of the influence of psychology on the behaviour of financial practitioners and the subsequent effect on markets. Behavioural finance is of interest because it helps explain why and how markets might be inefficient.

When we talk more on this capital Style this takes us to the behavioural skills which is the application. THE APPLICATION.

Behavioral skills are the skills you use to successfully interact with others.

Capital Style & portfolio management can be a theory of relativity study or an application as taken to be for the purpose of the very study.

Capital Style presumed to be the Runway, the establishment , the operative efficacy, nintendo hitherto.

Capital Market – Derivatives

Derivatives

What are derivatives?
Derivatives are financial contracts, which derive their value off a spot price time-series, which is called “the underlying”. The underlying asset can be equity, index, commodity or any other asset. Some common examples of derivatives are Forwards, Futures, Options and Swaps.

Derivatives help to improve market efficiencies because risks can be isolated and sold to those who are willing to accept them at the least cost. Using derivatives breaks risk into pieces that can be managed independently. From a market-oriented perspective, derivatives offer the free trading of financial risks.

What is the importance of derivatives?
There are several risks inherent in financial transactions. Derivatives are used to separate risks from traditional instruments and transfer these risks to parties willing to bear these risks. The fundamental risks involved in derivative business includes:

  • Credit Risk

This is the risk of failure of a counterparty to perform its obligation as per the contract. Also known as default or counterparty risk, it differs with different instruments.

  • Market Risk

Market risk is a risk of financial loss as a result of adverse movements of prices of the underlying asset/instrument.

  • Liquidity Risk

The inability of a firm to arrange a transaction at prevailing market prices is termed as liquidity risk. A firm faces two types of liquidity risks

  1. Related to liquidity of separate products
  2. Related to the funding of activities of the firm including derivatives.

  • Legal Risk

Derivatives cut across judicial boundaries, therefore the legal aspects associated with the deal should be looked into carefully.

What are the various types of derivatives?
Derivatives can be classified into four types:

  • Forwards
  • Futures
  • Options
  • Swaps

Who are the operators in the derivatives market?

  • Hedgers – Operators, who want to transfer a risk component of their portfolio.
  • Speculators – Operators, who intentionally take the risk from hedgers in pursuit of profit.
  • Arbitrageurs – Operators who operate in the different markets simultaneously, in pursuit of profit and eliminate mis-pricing.

Source : http://www.capitalmarket.com

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