What Is Guerrilla Marketing?

Guerrilla marketing is a marketing tactic in which a company uses surprise and/or unconventional interactions in order to promote a product or service. Guerrilla marketing is different than traditional marketing in that it often relies on personal interaction, has a smaller budget, and focuses on smaller groups of promoters that are responsible for getting the word out in a particular location rather than through widespread media campaigns.

Guerrilla marketing takes place in public places that offer as big an audience as possible, such as streets, concerts, public parks, sporting events, festivals, beaches, and shopping centers. One key element of guerrilla marketing is choosing the right time and place to conduct a campaign so as to avoid potential legal issues.

What Is Compound Annual Growth Rate – CAGR?

Compound annual growth rate (CAGR) is the rate of return that would be required for an investment to grow from its beginning balance to its ending balance, assuming the profits were reinvested at the end of each year of the investment’s lifespan.

Investors can compare the CAGR of two alternatives in order to evaluate how well one stock performed against other stocks in a peer group or against a market index. CAGR does not reflect investment risk.

It isn’t a true return rate, but rather a representational figure. It is essentially a number that describes the rate at which an investment would have grown if it had grown the same rate every year and the profits were reinvested at the end of each year. CAGR can be used to smooth returns so that they may be more easily understood when compared to alternative investments.

What is a Credit Default Swap (CDS)?

A credit default swap (CDS) is a financial derivative or contract that allows an investor to “swap” or offset his or her credit risk with that of another investor.

For example, if a lender is worried that a borrower is going to default on a loan, the lender could use a CDS to offset or swap that risk. To swap the risk of default, the lender buys a CDS from another investor who agrees to reimburse the lender in the case the borrower defaults. Most CDS will require an ongoing premium payment to maintain the contract, which is like an insurance policy.

A credit default swap is the most common form of credit derivative and may involve municipal bonds, emerging market bonds, mortgage-backed securities or corporate bonds.

What Is the Economic Cycle?

The economic cycle is the fluctuation of the economy between periods of expansion and contraction. Factors such as gross domestic product, interest rates, total employment, and consumer spending, can help to determine the current stage of the economic cycle.

The four stages of the economic cycle are also referred to as the business cycle. These four stages are expansion, peak, contraction, and trough.

-During the expansion phase, the economy experiences relatively rapid growth, interest rates tend to be low, production increases, and inflationary pressures build.

-The peak of a cycle is reached when growth hits its maximum rate. Peak growth typically creates some imbalances in the economy that need to be corrected.

-This correction occurs through a period of contraction when growth slows, employment falls, and prices stagnate.

-The trough of the cycle is reached when the economy hits a low point and growth begins to recover.

What is a Safe Haven?

A safe haven is an investment that is expected to retain or increase in value during times of market turbulence. Safe havens are sought by investors to limit their exposure to losses in the event of market downturns. However, what appears to be a safe investment in one down market could be a disastrous investment in another down market, and so the evaluation of safe haven investments varies. A safe haven investment diversifies an investor’s portfolio and is beneficial in times of market volatility.

What Is a Jitney?

Jitney is a broker that is able to perform stock exchange trade on behalf of another person who is not able to. The concept also refers to a stock trading that is fraudulently done to increase stock volume.

As such, the fraudulent trading may involve only 2 brokers that are trading stocks back and forth in order to earn more commission thereby increasing their volumes of trade.

What is a Black Swan?

A black swan is an extremely rare event with severe consequences. It cannot be predicted beforehand, though many claim it should be predictable after the fact. Black swan events can cause catastrophic damage to an economy, and because they cannot be predicted, can only be prepared for by building robust systems.

The term was popularised by Nassim Nicholas Taleb, a finance professor who argued that even though they are impossible to predict due to their extreme rarity, it is important for people to assume that a black swan event is a possibility and plan accordingly.

Example- The financial crash of the U.S. housing market during the 2008 crisis is one of the well-known black swan events. The effect of the crash was catastrophic and global, and only a few outliers were able to predict it happening.

Cash Flow From Operating Activities (CFO)

Cash flow from operating activities (CFO) indicates the amount of money a company brings in from its ongoing, regular business activities, such as manufacturing and selling goods or providing a service to customers. It is the first section depicted on a company’s cash flow statement.

There are two methods for depicting cash from operating activities on a cash flow statement: the indirect method and the direct method.

-The indirect method begins with net income from the income statement then adds back noncash items to arrive at a cash basis figure.

-The direct method tracks all transactions in a period on a cash basis and uses actual cash inflows and outflows on the cash flow statement.

What is Anchor Investor?

It is a concept launched by Securities Exchange Board of India. Anchor investors are institutional investors who are invited to subscribe the shares before the Initial Public Offers (IPOs) opens up so that it jazzes up the popularity of its issue. They are required to take up the share at a fixed price to make other investors confident and improve the demand of the share.

Each anchor investor needs to invest a minimum of 10 crore Rupees in the issue.

What is a Clearing House?

A clearing house acts as an intermediary between a buyer and seller and seeks to ensure that the process from trade inception to settlement is smooth. Its main role is to make certain that the buyer and seller honor their contract obligations. Their responsibilities include settling trading accounts, clearing trades, collecting and maintaining margin monies, regulating delivery of the bought/sold instrument, and reporting trading data.

The clearing house enters the picture after a buyer and seller have executed a trade. In acting as the middleman, a clearing house provides the security and efficiency that is integral for financial market stability.