P/E Ratios and Bubbles?

Q: How are the ratios useful?

A: Answer: Ratio analysis is allowing a comparison two firm’s annual financial statement using certain…

Q: What limitations do ratio analysis have?

A: Ratio Analysis: It is a technique used in the financial analysis field. Ratio analysis helps to use…

Q: How is the the financial ratio analyses very useful?

A: Ratio analysis is a method of relative measure between two numericals for gaining knowledge about a…

Q: What does the volatility value represents?

A: Volatility for a given product or market index is a factual proportion of the scattering of profits.…

Q: What are the advantages of balance sheet?

A: Financial Statement:   A financial statement is the complete record of financial transactions that…

Q: What is market model?

A: A market model is a numerical portrayal of the exchanges among different members, financial powers,…

Q: What is market/book (M/B) ratio?

A: Introduction: Market value is nothing but the value derived when the stock price is multiplied by…

Q: What is Ratio Analysis? Briefly explain

A: Ratio Analysis: It is the procedure of analyzing and looking at money related data by determining…

Q: Explain HPRs and Inflation?

A: Answer: Holding period returns (HPRs): Holding period return (HPR) is one of the investment…

Q: What is meant by convergence of US GAAP?

A: IFRS (International Financial Reporting System) is gaining popularity and momentum across all the…

Q: Liquid ratio formula?

A: Ratio analysis is referred as the quantitative method of understanding company’s liquidity,…

Q: What is “implied volatility”, how is it calculated, and how can it be used?

A: Implied volatility (IV) is a forecast of how much a security's price will fluctuate over a certain…

Q: What are solvency ratios and what do they measure?

A: Solvency ratios of the company indicates that whether cash flows of the company are sufficient to…

Q: Define Liquidity Analysis?

A: Liquidity analysis is very essential as it shows the ability of the firm in paying short-term bills.…

Q: Define volatility value.

A: Volatility is a rate at which the cost of a security increments or diminishes for a specified set of…

Q: What is the trend analysis?

A: Trend analysis is a procedure utilized in the technical investigation that expects to figure future…

Q: Whatis a yield curve?

A: It is the percentage of the securities at which the return is provided by the company to its…

Q: What is liquidity ratio?

A: Liquidity ratio is very essential as it shows the ability of the firm in paying short-term bills.…

Q: Define Treynor’s reward-to-volatility ratio

A: Formula to compute Treynor’s ratio as follows:

Q: What is the gradient-series present-worth factor with formula?

A: Step 1: When there is a uniformly change in rate of interest is a gradient series of cash flow. It…

Q: What is current ratio and how is it calculated?

A: Liquidity ratio:Liquidity or solvency ratio helps to measure the ability of the concern to meet its…

Q: define volatility

A: Volatility is a rate at which the cost of a security increments or diminishes for a specified set of…

Q: What does a high current ratio indicate?

A: Current ratio: The financial ratio which evaluates the ability of a company to pay off the debt…

Q: standard deviation of returns?

A: Risk is the value of volatility around the mean. It is measured via variance or square root of…

Q: unlevered cost of equity under Modigliani-Miller Model?

A: Formula:

Q: What is the difference between solvency ratio and liquidity ratio?

A: The quantitative technique that helps in the measurement of the liquidity, profitability, solvency…

Q: What value does the PEG ratio provide to financial analysts?

A: The price-to-earnings ratio of a stock is divided by the growth rate of its earnings over a given…

Q: What is Growth-share matrix?

A: Growth-share matrix is also known as Boston Consulting Group(BCG) matrix which is a planning tool…

Q: Why is liquidity ratio important?

A: Liquidity is how easily cash is available on hand. Liquidity ratio is defined as a ratio that is…

Q: What is market multiple analysis?

A: Answer: Market multiple analysis: A multiple analysis of market is a form of financial modelling to…

Q: Describe the Incremental B/C-Ratio Analysis?

A: Benefit cost analysis: Benefit cost analysis refers to analyzing the desirability of project where…

Q: What caused the increase in liquidity ratios??

A: Liquidity ratios use metrics such as the quick ratio, current ratio, and operating cash flow ratio…

Q: Is statistical arbitrage true arbitrage? Explain.

A: Statistical arbitrage refers to the strategy in which investor tries to make profit due to the…

Q: What are some reasons that net PP&E might grow proportionally tosales, and what are some reasons…

A: Property, plant & equipment are company's long term assets important for the company's…

Q: Why is ratio analysis so significant?

A: Ratio Analysis: This refers to the performance measurement of the business, in order to know the…

Q: What is ratio analysis?

A: Ratio analysis: The analysis of a company using the financial ratios and comparing its trends and…

Q: Why are comparative ratio analyses useful?

A: Financial analysis can be defined as the evaluation of the profitability, durability and feasibility…

Q: What does the quick ratio measure?

A: Ratio Analysis is a financial tool used to derive conclusions about the company’s health and overall…

Q: Current ratio formula?

A: Ratio analysis is the method of checking the company's operational efficiency, liquidity, and…

Q: What is information content hypothesis (dividends)?

A: Managers of the company generally prefer not to reduce the dividends paid to the shareholders with a…

Q: Risk Ratios

A: Average collection period = 365 * ((Opening accounts receivable + Closing accounts…

Q: What is trend analysis, and how does it differ from horizontal analysis?

A: Financial statement analysis: The process of analyzing the financial statements of a company to…

Q: Could you please discuss the limitations of financial ratio analysis

A: Introduction Ratio analysis may be defined as that type of analysis tools which is used to ascertain…

Q: what is equity analysis?

A: The person who takes the equity capital of the company is known as a stakeholder of the company. The…

Q: What is the difference between smart beta ETFS and index ETFS?

A: Smart beta exchange traded funds (ETFS) is a systematic approach which gives the advantage of active…

Q: what give rises to the changes in PBO balance?

A: PBO stands for the Projected Benefit Obligation. It shows how much the company would need in its…

Q: solvency ratios

A: Solvency ratio indicates the company's ability to pay off its debt obligation.