Angshuman Chakraborty's List: Terms Financial

• Market liquidity is a business, economics or investment term that refers to an asset's ability to be easily converted through an act of buying or selling without causing a significant movement in the price and with minimum loss of value.
   
   Home loan or a mortgage is the pledging of a property to a lender as a security for a mortgage loan. While a mortgage in itself is not a debt, it is evidence of a debt. It is a transfer of an interest in land, from the owner to the mortgage lender, on the condition that this interest will be returned to the owner of the real estate when the terms of the mortgage have been satisfied or performed. In other words, the mortgage is a security for the loan that the lender makes to the borrower.
   
   The reserve requirement (or required reserve ratio) is a bank regulation that sets the minimum reserves each bank must hold to customer deposits and notes. These reserves are designed to satisfy withdrawal demands, and would normally be in the form of fiat currency stored in a bank vault (vault cash), or with a central bank.
   
   Foreign direct investment (FDI) in its classic definition, is defined as a company from one country making a physical investment into building a factory in another country

• This is the amount of money that the banks have to necessarily park with the RBI. The base of this is the total of the deposits that a bank has. The RBI pays the bank interest on the amount parked with it.

• What is it? The bank base rate is set by the Bank of England and determines the cost of borrowing money. This base rate is used by commercial banks as a reference point when setting their own base rates. An increase in the base rate will increase the rates for mortgages and loans. However, savers will receive higher interest rates on their savings.

• Repo rate is the interest rate at which the reserve bank of  India lends mney to other banks.  Reverse repo rate is return banks earn on excess funds  parked with the central bank against Government securities.
• Repo rate is the discounting rate at which central bank  borrows security from commercial bank.Repo means repurchase  agreement b/w RBI &commercial bank.  Reverse repo is the rediscounting rate at which commercial  bank borrows discounted security from central bank ie RBI.
• repo rate is the rate at which RBI lends money to other  commercial banks.    and Reverse repo rate as the name suggests is the Rate at  which RBI borrows from other commercial banks.

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• Discount rate at which a central bank repurchases government securities from the commercial banks, depending on the level of money supply it decides to maintain in the country's monetary system. To temporarily expand the money supply, the central bank decreases repo rates (so that banks can swap their holdings of government securities for cash), to contract the money supply it increases the repo rates. Alternatively, the central bank decides on a desired level of money supply and lets the market determine the appropriate repo rate.

• Repo is like a repurchase agreement.The rate at which RBI sells securities to bank. 

   But, bank rate is the rate by which RBI lends money to commercial banks. 

• Discount rate at which a central bank repurchases government securities from the commercial banks, depending on the level of money supply it decides to maintain in the country's monetary system. To temporarily expand the money supply, the central bank decreases repo rates (so that banks can swap their holdings of government securities for cash), to contract the money supply it increases the repo rates. Alternatively, the central bank decides on a desired level of money supply and lets the market determine the appropriate repo rate.