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Share Market Terms , Definition and Meaning - Alphabetical LISTING - A, B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, Y, Z
Fixed Deposits The principal features of this kind of investment are: these are timebound, i.e., interest is received only for a stipulated period; the value of the invested amount does not appreciate; the interest rates are fixed for the period of deposit; the deposits with companies are unsecured. Companies usually accept deposits for 1, 2 or 3 (expect for leasing and hire purchase companies where the minimum period is 2) years, paying interest monthly, quarterly, or half yearly; the maximum interest they are allowed to offer is 15% although some companies try to improve this rate by calculating interest every month. Fixed deposits can be cumulative. Fixed deposits are also accepted by banks (lower interest rates) and financial companies. The risk in this kind of investment, apart from the erosion of the value of capital as a result of inflation, is (a) default or delay in interest payments, (b) delay or default in the refund of deposits, and (c) the company going into liquidation. An individual investor is practically helpless should any of these happen. Some of the government sponsored corporations are notorious defaulters. See also FIXED INCOME INVESTMENTS & APPENDIXE.
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Share Market Terms , Definition and Meaning - Alphabetical LISTING - A, B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, Y, Z
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