1.

Define the Following ; a. Bid and Ask Price b. Bonus Shares c. SBTS d. Zero Coupon Bonds e. Treasury Bill

Answer»

1. Bid and Ask Price : 

The ‘Bid’ is the buyer's price. It is this price that you need to know when you have to sell a stock. 

The ‘Ask’ (or offer) is what you need to know when you‟re buying i.e. this is the rate/ price at which there is seller ready to sell his stock 

2. Bonus Shares: Shares issued by the companies to their shareholders free of cost based on the number of shares the shareholder owns.

3. SBTS: NSE introduced a nationwide, on-line, fully-automated Screen Based Trading System (SBTS) where a member can punch into the computer the quantities of a security and the price at which he would like to transact, and the transaction is executed as soon as a matching sale or buy order from a counter party is found. 

4. Zero Coupon Bonds: Bond issued at a discount and repaid at a face value. No periodic interest is paid. The difference between the issue price and redemption price represents the return to the holder. The buyer of these bonds receives only one payment, at the maturity of the bond. 

5. Treasury Bill : Short-term (up to one year) bearer discount security issued by government as a means of financing their cash requirements



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