Search Results

* This is an advanced topic that is mainly relevant for financial modeling, in-depth company analysis, and understanding business fundamentals. Since it is not essential for the average investor, it is presented here for general knowledge. The Discounted Cash...

Stock buybacks are one of the most commonly used financial strategies by companies to manage their capital structure and enhance shareholder value. While they can be seen as a sign of confidence in the company itself, they can also have side effects that need ...

Capital increases are a key financial tool used by companies to obtain additional resources. They are a common strategy in financial markets and can significantly impact a company's structure and value. However, they can also bring risks and consequences for s...

Acquisitions Often Have a History of Poor Outcomes The evidence is clear: while acquisitions tend to benefit sellers, they often fail to generate value for buyers. This is typically due to three main reasons: 1. Sellers Control the Timing of the Sale In mos...

Real Estate Investment Trusts (REITs) are publicly traded real estate investment companies. Their equivalent in Spain is SOCIMIs (Sociedad Cotizada Anónima de Inversión en el Mercado Inmobiliario). These entities allow investors to gain exposure to the real es...

Insurance companies are financial entities specialized in risk management through the issuance of insurance policies. Unlike other companies, their accounting and operational structure has specific characteristics that must be understood to properly assess the...

The retail sector is a fundamental pillar of the economy, covering everything from supermarkets to fashion stores and department stores. This business model is characterized by inventory management, supplier relationships, and strategies to maximize profitabil...

The oil and gas industry is a cyclical sector highly dependent on macroeconomic factors such as global supply and demand, geopolitical conditions, and energy market stability. Understanding its structure and business models is key to assessing its long-term vi...

The pharmaceutical sector is a highly specialized and diverse industry, ranging from large multinational corporations with extensive research and development (R&D) capabilities to emerging biotechnology companies seeking to revolutionize medicine. Each segment...

The mining industry is a fundamental pillar of the global economy, providing essential resources for various industries, from construction to technology. It is a cyclical sector, highly dependent on the demand for raw materials and subject to price fluctuation...

The world of investing is an attractive environment for those looking to grow their wealth. However, it is also fertile ground for fraud and scams. Below is an in-depth analysis of how the main scams operate, how to identify them, and how to protect yourself. ...

Investment markets are fundamental to the global economy, as they facilitate the buying and selling of financial assets such as stocks, bonds, commodities, and derivatives. Among these markets, stock exchanges play a crucial role by providing a regulated envir...

1.    Concept of Bankruptcy and Liquidation When a company goes bankrupt, a liquidation process of its assets is activated to pay its creditors in a legally predefined order. This process follows a payment hierarchy that determines who has priority in recover...

1.    Fear & Greed Index The Fear & Greed Index, developed by CNN Business, is an indicator that measures market sentiment, determining whether investors are acting out of fear or greed. It is based on the premise that markets tend to behave irrationally at e...

1.    Constant Currency Constant currency is adjusted for inflation to reflect the real value of money over time. In economies with high inflation, financial statements are presented in constant currency to avoid distortions in accounting values. This is achi...

Financial markets are fundamental to the global economy and require strict regulation to ensure their proper functioning. Regulatory entities play a crucial role in overseeing markets, protecting investors, and preventing fraudulent practices. This document ex...

Stop Loss: An automatic sell order set to limit losses on an investment. It is triggered when the asset's price drops to a predetermined level set by the investor. Take Profit: An automatic sell order executed when the asset reaches a target price set...

ADR (American Depositary Receipt): An ADR is a certificate issued by a U.S. bank that represents shares of a foreign company, allowing them to trade in U.S. markets. Example: Alibaba Group trades on the New York Stock Exchange through ADRs. ISIN (Internat...

Financial markets do not move solely based on economic data or business fundamentals; emotions play a crucial role in investor behavior. Market psychology describes how investment cycles are driven by collective feelings, which can lead to speculative bubbles ...

📌 Confirmation Bias 🔹 Tendency to seek, interpret, and remember information that confirms our pre-existing beliefs while ignoring contradictory data. 📌 Anchoring Bias 🔹 Fixating on an initial reference point (such as a stock’s purchase price) and basing fut...