Definition of 'Scalability' - Deepstash

Definition of 'Scalability'

In the world of finance, scalability refers to the ability of a company to sustain or better its performance in terms of profitability or efficiency when its sales volume increases.

It is usually a big challenge for any company to maintain its profitability or efficiency when the volume of sales increases. Similarly, capital markets must have the ability to maintain their performance levels when the volumes of trade carried out by traders and investors rise.

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Many companies use the insights of financial managers and external consultants to manage their risk. A one-size-fits-all solution is not yet in existence when it comes to risk management.

These companies usually use derivatives like forwards, options, swaps and futures to offset their risk, but without a clear set of risk-management goals, the use of derivatives can increase the risk substantially.

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What is PPP ?

PPP is an economic theory that compares different countries' currencies through a "basket of goods" approach.

According to this concept, two currencies are in equilibrium or considered being at par—when a basket of goods is priced the same in both countries, taking into account the exchange rates.

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More Isn't Always Better

We live in an era where more isn't enough any longer. We tend to crave for more and we're made to believe that it is a good thing.

While we crave for more content, we often forget to check the quality of the content nowadays because we are told that constant consumption leads to more productivity which leads to more efficiency and results to more predictability which they can use to make us want to consume more. We are drawn to quantity because we feel that it is real and tangible.

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