Finance & Banking Fundamentals India

List of Formulae
Simple Interest (S.I)

= P*r*t/100

Compound Interest (C.I)

= [P*(1+r/100)^t P]

CAGR

= [(Final Value/Initial Value)^1/n]- 1

FV

= PV*(1+r/100)^t

PV

= FV/(1+r/100)^t

NPV

= PV of all cash inflows-PV of all cash outflows

e.g: NPV = -PV (C1) + PV (C2) + PV (C3).

Inflation

= Nominal Rate of Interest - Real Rate of Interest

NAV
Market capitalization
(cap for short)
Bond Price

= (Market value of the fund investments + Income receivable - Expenses payable)/

Total no. of Outstanding units
= Market Price * Number of Outstanding Shares of the Company
= C / (1 + r /m )^m*t
C = Coupon or Cash flows
r = Yield Rate in the Market
m = Number of times compounding happens in a year
t = Time period in years

Trading Position

= Total Purchases- Total Sales (could be in value or in quantity)

Spread

= Average Lending Rate Average Deposit Rate

NII

= Interest Earned on Loans - Interest Paid on Deposits

Risk Weighted Assets

= Asset Value*Risk Weight Assigned

CRAR

=Capital/ Risk Weighted Assets (Term used for NBFCs)

Finance Charges

= Interest Paid on Purchase Price for the Lease Period (Hire Purchase)

Lease Rental

= [(Purchase Price Residual Value) + Finance Charges] /Lease Period

Net Owned Funds

= Owners Equity Losses (Term used for NBFCs)

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