In the investment market, you need to perform various financial calculations, and these are not your school or college sums! You are expected to make decisions on your various investments, loans, asset borrowing, and purchases. This is where a financial calculator comes in. It helps you make your investment decisions wisely and can help you grow your career as an investor. However, how can a new investor know the usage of online financial calculators and why is it so important? Let’s find out.
What is a Financial Calculator?
A financial calculator is a tool that helps investors perform specific financial calculations. These types of stock-market-specific financial calculations cannot be done in a basic calculator. It is built to solve heavy financial calculations and has functions related to stock markets only.
Why Do You Need a Financial Calculator?
Not every calculation you need to make while trading in the stock market is present in your basic calculator. A financial calculator solves your calculations related to investments, cash flow amount, asset and debt calculations, and others. Moreover, a financial calculator also allows an investor to add a specific program/calculation unique to their work.
Some of the stock-market-specific calculations you can perform using a financial calculator are listed below:
Brokerage calculator:
Brokerage calculator to derive broker fees for commodities, equity, currency, and options.
SIP calculator:
SIP calculator for calculating how much you need to invest every month.
Lumpsum calculator:
Lumpsum calculator to estimate the future value of your lumpsum investment.
Interest rate calculations:
Interest rate calculations concerning your investments.
Present value and future value:
Present value and future value for money calculations. Estimate of appreciating and depreciating value of your assets.
Such kinds of calculative functions are not present in basic calculators. The financial calculator in these cases gives an accurate value and helps investors make decisions accordingly.
How Can a New Investor Make Use of Financial Calculators?
Following are some ways newbie investors can make use of a financial calculator:
- Financial calculators help in calculating various aspects of an investor’s job. It includes computing calculations related to investments, cash flow amount, expenses, debt calculator, and others.
- Financial calculators also help investors design their programs to solve economic issues.
- Investors can easily plan their investments using financial calculators.
- Financial calculators can also provide graphs to get a better assessment of the problems.
- Financial calculators help determine the future value of assets according to the inflation rate and other factors.
- Investors need various financial calculators such as a brokerage calculator, SIP calculator, and lumpsum calculator—all of which are present in a financial calculator
To Sum it Up
As a new investor, the financial calculator is your best friend. It does not just help you make better investment decisions, but also helps with financial planning. That’s why investors should know how to use a financial calculator to make suitable investments.
Disclaimer: This blog is not to be construed as investment advice. Trading and investing in the securities market carries risk. Please do your due diligence or consult a trained financial professional before investing.