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IPO (Initial Public Offering) A company which is unlisted and wants to raise funds from public then it can be done with the help of IPO. Usually IPO's are issued by companies in primary market to raise funds from public. As we know that companies needs capital to carry out different functional and operational activities and to meet this need they sell companies securities in primary market. The company gets a capital boost when an investor invests in its IPO and in return investor expects to get benefited from companies earnings proportional to their share holding. Types of IPO 1) Fixed price issue In fixed price IPO company offers its shares at a fixed price. Here company along with its underwriters analyze companies assets, liabilities and other financial parameters . After this they fix a price per issue. Under fixed price issue, investors know the share price before a company offers its shares to public and they need to pay full price whil...

Factor investment is a popular investment strategy where securities capable of offering high returns are selected. The two main factors which drives the returns of stocks are : macroeconomic factors and style factors. Some popular macro economic factors are inflation, liquidity, emerging markets, economic growth and style factors are value, momentum, quality, size etc. These factors have very low correlation with each other and therefore tends to perform well at different parts of economic cycle. Factor investing tends to design a well diversified portfolio with an aim of earning above market returns by managing risk in an optimum manner. Portfolio diversification is often done by investors in order to safely invest in market , but if a investor have chosen stocks which moves in lockstep then benefits of diversification can not be realized. For example : In a particular investor's portfolio there is a mixture of some stocks and bonds which may decline in its value when certain ...