An important consideration for liquidity purposes. Whilst some businesses may show all the characteristics of an excellent investment, the small size of a business can sometimes prove a limiting investment factor. We only want to spend time researching businesses whose shares we can actually buy and sell.
= Number of shares * Price per share
When Interest Rates (IR) are high (i.e. borrowing is expensive) consumers pay more for their mortgages, loans and credit, so have less disposable income and spend less…inflation goes down.
You probably sort of know how index linked gilts, or “linkers,” work. The redemption value is linked to the change in the retail price index, or RPI, that takes place over the life of the gilt.
Another word for duration could be the average life of a bond. Most bonds pay annual or semi-annual coupons and have a redemption date. So whilst a bond maturing in three years and with a £5 annual…
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