Every term has these loads and after deduction, the net amount gets deposited into your bank account so be sure to check them before investing. There are lot of financial terms available in the mammoth market but some of them are very basic.
Here are ways that can help in investing in financial matters-
Let’s set off with the best 5 Financial Terms to Know before Investing in any financial matters. They are discussed as below:
- Simple Interest and Compound Interest are very common term in the market. Where there is an investment there will be always be a deviant over the interest.
- Liability is a term when you buy and product for credit and you have to repay the amount to the party or lender in a monthly scheme. It can also be termed as a responsible one as it can be a loan, a mortgage, EMI.
- Depreciation value needs to be known as every day we by something of our need and want. In that want category there is phone, bikes, other electronic gadget which overtime loses its value very drastically, so if this product has longevity you should go for them or you will lose a ton.
- Locking period is a time period within which you can not break the term deal and if you do then you need to repay the bank dome penalties. It can include interest which you have to pay them.
- Entry and exit load are the amount gest deducted to a certain percentage from the amount you are investing and talking out after maturity. For third party firm it is the brokerage firm and for banks it termed as taxes.
- SIP is known as systematic investment plan which is a mutual fund and it is a finance stock which goes up with market and goes down with the same so this can give you high return as well.
If the interest is simple, you will get the profit out of the principal amount. But in case of compounding the interest is counted over the net value which consists of previous year interest as well.