Opting for a loan?.. think a while to decide up on fixed & flexible rate of intetest that fits for your business needs..

While taking a loan, interest rate is always remains an impotent criteria to consider in to. Further, in time of taking up a term loan most of the people finds difficult to decide up on what mode of interest will be ultimate beneficial for the business regards to future course of payments. Lets put few words in defining what do we exactly mean by fixed & floating rate of interest charge. Fixed rate of interest, as the terms suggests rest in a definite rate being fixed at the time of signing in to loan agreement. Again, floating rate of interest floats accordingly as per change in interest rate portfolio of the lender( commonly a bank, other non banking financial institutions etc). At the time of entering in to the contract, either of these types of interest is settled as per relation between the borrower & lender, creditworthiness of the loan seeker & prevailing rate equals or more than the prime rate as prescribed by the governing rules. However, very often people get puzzled in opting out the most appropriate payment mode that will serve best for them. Taking in to account of the following factors can be helpful in taking suitable payment option. Lets have a look..

Firstly while signing in to contract deal, take a wise look in to the current economic scenario as well as future outlook in present term. For instance, if one opts for a loan & the economic strength & stability remains intact.. can be settle of in a fixed rate as the further economic boom may boost up the interest rate to a new high.

Secondly, the present as well as future viability of the industry with in the economy in which the object of the borrower persists. If one asks for home loan, the respective rigidity of the housing industry need to be considered. Henceforth, if the demand is on, it can be presume that the rate will not fall in near future rather it may go up as long as demand dominates.

Thirdly, need to compare the current rate with the prime rate, i.e, the rate prescribed by the regulating authority. If the rate is varies too much need to have further negotiation with the lender or look out other alternative options.

Fourthly, the current REPO & Reverse REPO is also a critical criterion to opine up on mode of interest rate fixation. If there is enough liquidity in money & capital markets, it is expected to encounter a strict monitory policy. Accordingly, the banks & other financial institutions are forced to increase the interest rate to restrict the borrowing capacity of the probable buyers & encourage in savings.

Fifthly & most impotently self risk tolerance capability & anticipation upon future economic credibility plays a vital role in resorting in to either of the payment rate.

Lastly, the tenure or the loan acts in the decision making. If the tenure to too long, it is quite impossible to opine upon what can be the social as well as economical scenario after several years. In such cases, fixed rate can be preferable.

InVestment in CoMModities: An IneVitable tRading opTion..

In recent times, a coroborative curicity pops up among traderes across the countries in commodities & their tradability. Many of them beting over these commodities as an inevitable investment option in coming days. But.. all these words are more prospective over present perspects. Lets find out what these commodities actually do mean.

Commodites can be largely termed as goods having a little distinctive aspect. What differs them from common term is their world wide avilability & acceptability along in the line of consistency with a least variation in standard & quality. Lets take few examples of commodities that are commonly in use like precious metal(gold, silver, copper etc), agricultural products such as rubber, corn, rice ,sugar etc., energy & industrial resources like crude oil, coal & aluminium etc. However their respective trading value varries in accordence with their tradability.

Now lets see how traders play in this market. Although here we deals in commodities, it doesn't necessorily mean that we need to buy or sell commodities in physical sence. Moreover, what actually do mean is to buy a future contract of an underlaying commodity at a certain price at a certain future date more like future trading in equity market. Accordingly, in the mean time the daily price of such commodity varries accordingly. the extent of these varrietions effects in fixing up future contract price. In technical term, commodity trading commonly practices in derivative tools rather than dumping up for further deal in real term.

As I have stated earlier, commodity market gradually growing up with global applosure. Now days commodities are traded accross the countries in various exchanges like Chicago Mercantile Exchange, Australian Securities Exchange, the Tokyo Commodity Exchange etc. These exchanges facilitates the platform for plotting future course of contracts. Now, unlike eqity market, valuation of a commodity depends upon several events strats from environmental to social,political & economical outlooks. For exampale, price of crops varries yearly in accordance with change in climate & it's favourability. Similarly, for crude oil the pricing depends up on economical & political stability of eastern countries as well as economic conditions of other countries. These seriees of fluctuations among commodities helps in fueling momentum in to the commodity market. Accordingly for a trader, need to predict the future contract price taking the factors like cyclical trend in supply & demand, social, economical & political aspects as well as future viability.

Comodity Trading: an emerging Investment option..

Commodities can be defined as goods having wide demand & doesn't differ much in terms of quality. On the basis of such standardized quality, these goods are considered as an useful investment as well as trading options. For instance, gold, silver, crude oil etc doesn't differs much in due course. Apart from these, other popular traded commodities are.. precious metals like gold, silver, copper etc. , agricultural products such as rubber, corn, rice & sugar., energy & industrial resources like crude oil, coal, aluminum etc.

In recent times, may investors & traders are taking their bet in to the commodity market as an inevitable invest option.