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What is Debt ? Debt mean a loan, a liability that you need to pay legally, no matter whether you have the resources to pay it or not. Debt, when managed prudently, can help you accomplish your financial goals and satisfy your needs. That said, one small misstep and you can quickly find yourself trapped under mounting debt. In addition to causing you loads of financial stress, overwhelming debt can also significantly affect your mental health. Such high levels of debt are what most financial experts call a ‘ debt trap .’  What is meant by a debt trap ? Technically, a  debt trap  is a situation where you’re forced to take fresh loans to repay your existing debt obligations. And before you know it, you get stuck in a situation where the amount of debt that you owe takes a turn for the worse and spirals out of control. Such a situation typically arises when your debt obligations exceed your repayment capacity.  For instance, when the income that you generate is not enoug...

In this post I have listed down some STEPS. TIPS to be considered while doing Equity Analysis.I have assumed that the reader is well aware of Fundamental &Technical Analysis along with Valuations -   1. Separate the business from the balance sheet        How is the business capitalized? Is it sustainable? Is it relatively efficient/optimal?         What are the assets worth? Liquidation value and reproduction value         Are there any “hidden” assets or liabilities?         Excess cash, real estate, LIFO, etc.         Pension, legal liability, litigation, operational malfeasance, funding/liquidity puts, etc. 2. Separate the business from the cash flows        What are the cash flows saying, regardless of the broader business stereotypes/assumptions?        How much cash can be taken out of the business every year? Owner’s earning (net inc...

  Many of us have this question .So, let me start by listing some details of the two instruments. The  Employees’ Provident Fund , or EPF, is a retirement fund for organised sector employees, managed by the Employees’ Provident Fund Organization, or EPFO. Under the EPF scheme, a salaried employee pays 12% of basic salary (plus dearness allowance) every month, and an additional 12% is contributed by the employer. In total, 24% goes towards the EPF account. The interest rate is currently fixed at 8.5%. The  Public Provident Fund , or PPF, is a government-backed small-saving scheme. Though started in 1968 with the objective of providing social security during retirement to workers in the unorganized sector and for self-employed individuals, it has become a very popular tax-saving instrument. The interest rate is 7.1%; this is fixed every quarter. Are these debt instruments? A debt investment is one that offers a fixed return to the investor with a promise to repay the princi...