The major differences between book value and market value are as follows −Book valueReal value of an asset.Reflects firm’s equity.Not related to financial market.Depreciation is taken into account.Book value = (assets – liabilities)/ number of outstanding shares.Book value = cost of asset – (depreciation + amortization).Frequency of fluctuations happens at ... Read More

The major differences between equity and commodity are as follows −EquityCommodityInvestment/capital invested in a firm/entity to acquire ownership.Known as shareholder.Have ownership of that particular firm.Less volatile.Long term investments.Less risk compared to commodity trading.They get dividends.Better liquidity.Very few regulations, free market.Don’t need margin.Risk is not diversified.Do not have lot size.Traded on ... Read More

The major differences between investing and trading are as follows −InvestingCreates wealth over a long period of time.Buying and holding.Market fluctuations has no effect.Add on benefits − bonus, dividends etc.Fundamental indicators are EPS, price to earnings, current ratio etc.Long term period.Creates wealth by compound interest and dividends.Low risk.Industry, economics, financials, ... Read More

The major differences between stock market and commodity market are as follows −Stock marketHave same security in same grades.All securities have same face value and characteristics.Doesn’t deteriorate over a period of time.Derive its value from an underlying asset.Supply is fixed.Commodity marketHave several grades/varieties of products/commodity.Grade may vary from other lots ... Read More

The major differences between stock market and stock exchange are as follows −Stock marketStock exchange will take place through different parkways.Without stock market, trades would have no motivation to exist.OTC, ECN, Stock exchange are types.Doesn’t work as cleaning house.Common for all form of stock trading.Conducts trading activities.Stock exchangeOrganisations have precise ... Read More

The major differences between CAPEX and OPEX are as follows −CAPEXBenefits organization more than one year.Also called as capital expenditure, capital expense.One-time purchase.Long term tenure.They are depreciated or amortized over the time.Listed as property or equipment.Earns profits slowly/gradually.Lending institutions act as source of finance.CAPEX comes in balance sheet.Examples − buying ... Read More

The major differences between present value and future value are as follows −Present valueCurrent value of cash flow in future.Current value of an asset or an investment at starting of a particular time period.Inflation is considered.Discount rate and interest rate are considered.Helps investors in decision making.Discounted process/method is followed.Present value ... Read More

The major differences between present value and net present value are as follows −Present valueSum of discounted value of cash flow at a particular discounting rate.Measures future cash flows today.Does not measures additional wealth.Does not provide any information about incremental value of a project/investment.Present value = Future value / (1 ... Read More

The major differences between invoice and bill are as follows −InvoiceWill have detail list of purchased products, their quantity, price, taxes (if any) etc.Handed over by seller to buyer at any time (before/after service or product).Advanced has to be paid.Records all the items placed.Invoices may arrive along with the goods ... Read More

The major differences between private equity and venture capital are as follows −Private equityInvestments made in those companies which are not publicly listed on any stock exchange.Buys from mature and public companies.Focus will be on all kind of industries.Want to acquire almost full stake of the company in an LBO.Combination ... Read More