10+ Statestreet HCL Services Financial Analyst Interview Questions and Answers

A balance sheet shows a company's assets, liabilities, and equity at a specific point in time.

• The left side of the balance sheet shows the company's assets, which are resources that the company owns or controls.

• The right side of the balance sheet shows the company's liabilities, which are obligations that the company owes to others.

• The difference between the assets and liabilities is the company's equity, which represents the residual interest in the assets after deducting li...read more

A stock split is a corporate action in which a company divides its existing shares into multiple shares.

• Stock split increases the number of shares outstanding while reducing the price per share.

• The total value of the shares remains the same.

• For example, a 2-for-1 stock split would double the number of shares outstanding and halve the price per share.

• Stock splits are usually done to make shares more affordable for investors and increase liquidity.

• Stock splits do not affect the...read more

Capital market is a platform where companies and governments can raise long-term funds by selling securities to investors.

• Capital market is a part of the financial market.

• It facilitates the flow of savings and investments between investors and issuers.

• It includes stock markets, bond markets, and other securities exchanges.

• Companies and governments can raise capital by issuing stocks, bonds, and other securities.

• Investors can buy and sell securities in the capital market to ea...read more

Financial markets refer to platforms where buyers and sellers trade financial assets such as stocks, bonds, currencies, and commodities.

• Financial markets facilitate the flow of capital between investors and borrowers.

• They provide liquidity and price discovery for financial assets.

• Examples include stock exchanges like NYSE and NASDAQ, bond markets, forex markets, and commodity markets.

A spinoff is a corporate action where a company creates a new independent company by separating a part of its business.

• A spinoff can be done through a distribution of shares to existing shareholders of the parent company.

• The new company can have its own management team and board of directors.

• Spinoffs can be done to unlock value for shareholders or to focus on core businesses.

• Examples of spinoffs include PayPal from eBay and Dow from DowDuPont.

A mutual fund is a type of investment vehicle consisting of a portfolio of stocks, bonds, or other securities, managed by a professional fund manager.

• Mutual funds pool money from multiple investors to invest in a diversified portfolio of securities.

• Investors buy shares in the mutual fund, which represents a portion of the holdings in the fund.

• Mutual funds are managed by professional fund managers who make investment decisions on behalf of the investors.

• They offer diversificat...read more

Equity represents ownership in a company, mutual funds pool money from multiple investors to invest in securities, and derivatives are financial contracts whose value is derived from an underlying asset.

• Equity is ownership in a company, represented by shares of stock

• Mutual funds pool money from multiple investors to invest in a diversified portfolio of securities

• Derivatives are financial contracts whose value is derived from an underlying asset, such as options or futures

• Equi...read more

Derivatives are financial instruments whose value is derived from an underlying asset or group of assets.

• Derivatives can be used for hedging, speculation, or arbitrage.

• Common types of derivatives include options, futures, forwards, and swaps.

• Derivatives allow investors to take on leverage and potentially amplify returns.

• They can be used to manage risk by offsetting potential losses in one asset with gains in another.

• Derivatives are traded on exchanges or over-the-counter mark...read more

Equity represents ownership in a company and is calculated as assets minus liabilities.

• Equity is the value of an asset after deducting any liabilities associated with that asset.

• It represents the ownership interest in a company and can be in the form of common stock, preferred stock, or retained earnings.

• Equity can also refer to the value of a property or investment after subtracting any debts or mortgages.

• In accounting, equity is shown on the balance sheet as the difference ...read more

Yes, I am comfortable with the location.

• I am open to working in different locations.

• I have experience working in diverse locations.

• I am willing to relocate if required.

• I have researched and familiarized myself with the location of the company.

Gross domestic product (GDP) of India is the total value of all goods and services produced in the country in a year.

• India is one of the fastest growing major economies in the world.

• GDP is an important indicator of a country's economic health.

• In 2020, India's GDP contracted by 7.3% due to the impact of the COVID-19 pandemic.

• The GDP growth rate is calculated by comparing the GDP of one year to the GDP of the previous year.

A derivative is a financial contract whose value is derived from the performance of an underlying asset, index, or interest rate.

• Derivatives can be used for hedging, speculation, or arbitrage

• Common types of derivatives include options, futures, forwards, and swaps

• Derivatives allow investors to take leveraged positions in the market

• Derivatives are often used to manage risk in portfolios

Investment banking involves providing financial services to corporations, governments, and other institutions.

• Helping companies raise capital through issuing stocks and bonds

• Advising on mergers and acquisitions

• Providing strategic financial advice to clients

• Assisting with IPOs (Initial Public Offerings)

• Trading securities for clients

The Golden Rule of accounting is to record debit and credit transactions accurately and equally.

• Every transaction should have equal debit and credit amounts

• Assets = Liabilities + Equity

• Example: If a company purchases inventory for $100, the entry should be a debit of $100 to inventory and a credit of $100 to cash or accounts payable

• The rule ensures accuracy and balance in financial statements