IPOs
How does an IPO take place?
- When a company wants to go public, the first thing it does is hire a financial advisor or an investment bank to manage the public issue.
- The company and the investment bank meet to discuss the amount of money the company would raise, the type of securities to be issued, and all details in the underwriting agreement
- The underwriter puts together what is known as the RED HERRING prospectus.
- This is an initial prospectus containing all the information about the company except for the offer price and the effective date not known at that time.
- With the red herring in hand, the underwriter and company attempt to find the appetite for shares. They go on a road show to tap institutional investors.
Ways of Applying for an IPO
Using ASBA, you can invest in public issues by authorizing the bank to block an amount equivalent to the application amount in the linked bank account. The application amount is not debited from the account but remains blocked till the completion of allotment process. On allotment, amount required will be debited from the bank account whereas in case of partial or no allotment, the amount unutilized due to non-allotment will be released
Currency
Trading in Currency (Forex) Derivatives
"Never keep all your eggs in one basket"
Financial markets are a classic example of this proverb. These markets all around the world in all categories and at all points of time have taught us to keep our investments diversified into various instruments.
Currency derivatives are a contract between the seller and buyer, whose value is to be derived from the underlying asset, the currency value. A derivative based on currency exchange rates is an agreement that two currencies may be exchanged at a future date at a stipulated rate.
For the first time this segment is accessible to the retail players in the currency trading market.
Portfolio Management
We understand that caught up in the daily grind, it is difficult to set time aside to invest in the stock market. They, thus, help you manage your portfolio, with the help of professional fund managers.
Derivatives (F & O)
Online Derivatives Trading
In the stock market, you can buy and sell shares of companies. Based on these shares, derivatives instruments are also traded on the market. These instruments are an agreement to buy or sell the underlying shares in the future. This agreement is sold in the market. They are called contracts.
Derivative instruments are available for shares, indices, currencies as well as commodities. Their value is tied to the underlying security.
Types of Derivative Instruments:
There are two kinds of derivative instruments – futures and options. Futures are contracts or an agreement between two parties to either buy or sell a fixed quantity of assets at a particular time in the future for a fixed price. An option is also a similar contract, except the parties are not obligated to fulfill the terms of the agreement. These contracts are then traded in the market. The minimum value of a contract is Rs 2 lakh.