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Tag Archive: bond


Yesterday I was going through some of the Indian newspapers and surprised to see some articles on Indian debtblog-3 market, which is a very rare scenario where the Indian market is dominated by equities. May be it was more a tax saving investment as the equity market where more volatile and IPOs were flopped.

Whereas the developed world debt market dominates where the bond market, has experiences gains and losses in response to cyclical interest-rate, It’s like business cycle during which an economy expands, contracts and recovers could be termed as market cycle.

Before getting back to the Indian bond market let’s try to see the key components of Fixed Income securities, it’s the Credit quality, yield, and maturities are key components of fixed-income securities.
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Recently sharing and discussing on the economic growth and the debt market yield spread impact recalled me some blogwork I did in the past and its worth sharing,

The abstract was based on the evidence that yield spread can serve as a leading indicator of economic activity.It’s important to understand few basic concepts before moving forward:

YIELD SPREAD: The difference between yield of long-term debt and short-term debt instrument is known as yield spread. Higher the difference between instruments greater will be the yield spread.

For example, if the 05-year Treasury bond is at 3% and the 20-year Treasury bond is at 4%, the yield spread between the two debt instruments is 1% (4% – 3%). Continue reading

Buying and selling in the market are the most important decisions the investors make. Maximum time the decisionsblog are wrong and you end up paying the market fee for equity investment learning.  In the past 36 years Indian market gave positive returns for 24 years and negative returns for 12 years.

Occasionally I do repeat my posts as some ideas from Mr Lynch’s book that I try to follow most of the time, they are old but they have major significance today too :- Continue reading

The crisis has given the birth to new jargon’s and terminologies in the world of financial market, I had tried to
English: The Broker at the Verizon Centeraccumulate few of them from various sources:

  • [h]ypothecation is when a borrower pledges collateral to secure a debt. The borrower retains ownership of the collateral but is “hypothetically” controlled by the creditor, who has a right to seize possession if the borrower defaults.
In the U.S., this legal right takes the form of a lien and in the UK generally in the form of a legal charge. A simple example of a  is a mortgage, in which a borrower legally owns the home, but the bank holds a right to take possession of the property if the borrower should default. Continue reading
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