Hence, they want their investment to remain safe by owners’ capital. In other words, lenders will be willing to give loan to the company only when the base of the company is strong, meaning thereby, when the company has sufficient equity share capital. Lenders desire it to be so, because...
Trading on equity, which is also referred to as financial leverage, occurs when a corporation uses bonds, other debt, and preferred stock to increase its earnings on its common stock
Equity trading is the practice of investors buying and selling shares of companies on a publicly traded exchange. The basics of...
What is the most important output of the accounting cycle? Do all companies have an accounting cycle? Explain. What is meant by the term "trading on the equity?" How are the operating and cash cycles of the firm different? Why are they important?
What does it mean if the return on asset ratio is lower than the previous year? Explain. How do you calculate the debt to equity ratio for a company for the last two years? What does it mean if the liquidity ratio is higher than the previous year?
In other words, if a company is currently trading at a P/E of 20x that would mean an investor is willing to pay $20 for $1 of current earnings. The share price of a stock may look cheap, fairly valued or expensive, depending on whether you look at historical earnings or estimated ...
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But this does not mean that index funds are without weaknesses. “Other important differences between ETFs and index funds include investment minimums,” says Rodney Comegys, the global head of the Equity Index Group at Vanguard. Depending on the provider of the index fund, there may be a mi...
The fees are calculated as an annual percentage of assets, although they come out on a prorated basis every trading day. Those fees, when added together and divided by the total assets in the fund, equal the fund’s expense ratio. The expense ratio helps you compare the costs of one fun...