Archives: Resources

Greater Fool Theory

What is greater fool theory? Greater fool theory simply states that there will always be a “greater fool” in the market who will be ready to pay a price based on higher valuation for an already overvalued security. Markets are affected by a lot of irrational beliefs and expectations of market participants. Based on this…

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Crossover Rate

What is Crossover Rate? Crossover Rate is the rate of return (alternatively called weighted average cost of capital) at which the Net Present Values (NPV) of two projects are equal. It represents the rate of return at which the net present value profile of one project intersects the net present value profile of another project….

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A Career Guide to Private Equity Jobs

Private Equity Overview Private equity firms are investment management companies that acquire private companies by pooling capital provided from high net worth individuals (HNWI) and institutional investors. Altogether, private equity firms manage nearly $1 trillion of investment capital, which they put to use through strategies such as direct investment in private companies, leveraged buyouts (LBOs),…

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Top Australian Banks

Overview of Australian Banks The Australian banking system plays a major role in the country’s financial system. Apart from traditional banking services, banks also provide business banking, trading in financial markets, stock broking, insurance, and funds management.  There are 53 Australian banks, of which 14 are owned by the government.  This guide will outline the…

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CFP vs CFA

CFP vs CFA: which path to choose? Certified Financial Planner (CFP) and Chartered Financial Analyst (CFA) are the two most talked about designations in the field of finance. Both of them serve different interests and candidates will eventually perform work of a different nature. Both may sound similar, but in reality, they serve different purposes…

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Markup Calculator & Formula

What is markup percentage? The markup percentage is a concept commonly used in managerial/cost accounting work and is the difference between the selling price and cost of a good, divided by the selling price of that good. This guide outlines the markup formula and also provides a markup calculator to download. Markup percentages are especially…

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Net Identifiable Assets

What is Net Identifiable Asset? Net Identifiable Assets (NIA) consists of the assets acquired from a company whose value can be measured at a given point of time and its future benefit to the company is recognizable. NIA is used for Purchase Price Allocation (PPA) and the calculation of Goodwill in Mergers and Acquisitions (M&A)….

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IBD – Investment Banking Division

What is the Investment Banking Division (IBD)? IBD is an acronym for the Investment Banking Division within the overall investment bank.  IBD has responsibility for working with corporations, institutions, and governments to carry out capital raising (underwriting in equity, debt and hybrid markets) as well as execute mergers and acquisitions and various types of advisory…

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Stockholders Equity

What is Stockholders Equity? Stockholders Equity (also known as Shareholders Equity) is an account on a company’s balance sheet that consists of share capital plus retained earnings. It also represents the residual value of assets minus liabilities. By rearranging the original accounting equation, Assets = Liabilities + Stockholders Equity, it can also be expressed as: Stockholders…

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What is Sensitivity Analysis?

Overview of sensitivity analysis What is sensitivity analysis? Sensitivity Analysis is a tool used in financial modeling to analyze how the different values of a set of independent variables affect a specific dependent variable under certain specific conditions. In general, Sensitivity Analysis is used in a wide range of fields, ranging from biology and geography…

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