finance
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Prepayment Risk Explained: Understanding Early Loan Repayments
Prepayment risk refers to the risk that the principal amount (or a portion of the principal amount) outstanding on a loan is prematurely paid back. In other words, prepayment risk is the risk of early
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Prepayment Explained: Types, Benefits & Financial Analysis
A prepayment is any payment that is made before its due date. Prepayments may be made for goods and services or toward settling a debt. They can be categorized into two groups: Complete Prepayments an
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Preferred Shares: A Comprehensive Guide for Investors
Preferred shares (also known as preferred stock or preference shares) are securities that represent ownership in a corporationCorporationA corporation is a legal entity created by individuals, stockho
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PRAT Model: Understanding Sustainable Growth & Financial Health
The PRAT model, also known as the sustainable growth rate (SGR) model, is used to describe the optimal rate of growth a company can achieve without borrowing more debt or using equity. The PRAT model
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Pound Sterling (GBP): History, Value & Key Facts
The Pound Sterling refers to the national currency of the Isle of Man, the United Kingdom, South Sandwich Islands, Gibraltar, South Georgia, and the British Antarctic Territory. It is the oldest curre
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Portfolio Variance: Understanding Risk and Diversification
Portfolio variance is a statistical value that assesses the degree of dispersion of the returns of a portfolio. It is an important concept in modern investment theory. Although the statistical measure
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PIK Loans Explained: Definition, Uses & Leveraged Buyouts
A payment-in-kind or PIK loan is a loan where the borrower is allowed to make interest payments in forms other than cash. The PIK loan enables the debtor to borrow without having the burden of a cash
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Philippine Peso (PHP): Your Comprehensive Guide
The Philippine Peso refers to the Philippines’s official currency and is represented by ISO code PHP. The Bangko Sentral ng Pilipinas (BSP), the Philippines’ central bank, mints and prints
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Personal Finance: A Comprehensive Guide to Planning & Management
Personal finance is the process of planning and managing personal financial activities such as incomeAnnual IncomeAnnual income is the total value of income earned during a fiscal year. Gross annual i
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Perpetuity Explained: Understanding Infinite Cash Flows
Perpetuity in the financial system is a situation where a stream of cash flowValuationFree valuation guides to learn the most important concepts at your own pace. These articles will teach you busines
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Peer-to-Peer (P2P) Lending: A Comprehensive Guide
Peer-to-peer lending is a form of direct lending of money to individuals or businesses without an official financial institution participating as an intermediaryFinancial IntermediaryA financial inter
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Pecking Order Theory: Understanding Corporate Financing Strategies
The Pecking Order Theory, also known as the Pecking Order Model, relates to a company’s capital structureCapital StructureCapital structure refers to the amount of debt and/or equity employed by
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Understanding Payment Processing Fees: A Comprehensive Guide
Payment processing fees are the costs that business owners incur when processing payments from customers. The amount of payment fees charged to a merchant depend on various factors such as level of ri
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Participative Budgeting: Definition, Benefits & Implementation
Participative budgeting is a budgeting process in which the people who are in the lower levels of management are involved in the budget preparation process. Unlike the imposed budgetingImposed Budgeti
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Participating Preferred Stock: Definition & Benefits
Participating preferred stock gives the holder the right to a specific dividend which is separate from the dividends common stockholders receive and is also received before common stockholders. It is
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Parent Company Explained: Definition, Control & Examples
A parent company is a company that owns more than 50% of the outstanding voting shares of another company. Therefore, it controls the other company or companies and can directly influence the business
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P/FFO vs. P/AFFO: Understanding REIT Valuation Metrics
P/FFO vs P/AFFO are considered more sophisticated metrics to measure REIT performance. Though earnings per share (EPS)Earnings Per Share (EPS)Earnings per share (EPS) is a key metric used to determine
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Understanding P/FFO: A Key REIT Valuation Metric
P/FFO, or Price to Funds From Operations, can be described as a reliable and modern way of determining the value of a Real Estate Investment Trust (REIT)Private REITs vs Publicly Traded REITsPrivate R
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P/AFFO Explained: Understanding REIT Financial Health
The P/AFFO is calculated by adding the P/FFO to any rent increases and subtracting capital expenditures and the routine maintenance costs. The P/AFFO is a measure of the financial performance of a REI
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Understanding the Overnight Interest Rate: A Comprehensive Guide
The overnight rate refers to the interest rate that depository institutions (e.g., banks or credit unionsCredit UnionA credit union is a type of financial organization that is owned and governed by it
finance
- Understanding Degree of Operating Leverage (DOL): A Comprehensive Guide
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- Unlock the Potential: Benefits of Online Trading Platforms
- Mortgage Guide: Understanding Options & Getting Approved
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Turn Your Passion Into Profit: 10 Hobbies That Generate IncomeTurn your favorite hobby into a money-making machine. Whether youre saving for an exotic vacation or to buy your first house, youre not alone in keeping a tight rein on your finances. More peo...
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Margin Calls Explained: Understanding and Avoiding ThemA margin call occurs when the value of a margin account falls below the account’s maintenance margin requirement. It is a demand by a brokerage firm to bring the margin account’s balance u...
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Make to Order (MTO): Definition, Benefits & ApplicationsMake to Order (MTO) is a production technique in which producers start manufacturing a product only after the customer places an order for it. In such a case, commodities are produced in a customized ...
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Revisiting Investment Fundamentals: A New Study on Risk & ResearchImage Credit: @lyndseywallis/Twenty20 Let's just get this out of the way: Investing can be baffling at first. Somewhere between "do your research" and "follow your gut" is...