Stocks FAQs

  1. If a company undergoes an acquisition can an employee withdraw 401(k) funds tax free?

  2. How do I take qualitative factors into consideration when using fundamental analysis?

  3. Why is the compound annual growth rate (CAGR) misleading when assessing long-term growth rates?

  4. What is a tuck-in acquisition?

  5. What is the difference between economic value added and market value added?

  6. What is the formula for calculating compound annual growth rate (CAGR) in Excel?

  7. A cash buyout agreement has been announced for a stock I own, but why isn't my stock trading at a per-share price equal to the buyout price?

  8. What is the formula for calculating the debt-to-equity ratio?

  9. What are some common traits of undervalued stocks?

  10. What are the best indicators for evaluating technology stocks?

  11. How does Warren Buffett choose the companies he buys?

  12. What technical indicators can I use to find undervalued stock?

  13. What does a high inventory turnover tell investors about a company?

  14. Why is it sometimes better to use an average inventory figure when calculating the inventory turnover ratio?

  15. How do you calculate working capital?

  16. How do changes in working capital affect a company's cash flow?

  17. How do you calculate return on equity (ROE)?

  18. What are the main differences between return on equity (ROE) and return on assets (ROA)?

  19. What are the main differences between compound annual growth rate (CAGR) and internal rate of return (IRR)?

  20. Are companies with a negative return on equity (ROE) always a bad investment?

  21. How do I calculate the inventory turnover ratio?

  22. Why is return on investment (ROI) a bad measure for calculating long-term investments?

  23. What factors go into calculating social return on investment (SROI)?

  24. How do I calculate the P/E ratio of a company?

  25. How can the price-to-earnings (P/E) ratio mislead investors?

  26. How can return on investment (ROI) calculations be manipulated?

  27. Is there value in comparing companies from different sectors by using the debt-to-equity ratio?

  28. What is the formula for calculating earnings per share (EPS)?

  29. What is the formula for calculating the current ratio?

  30. How do interest rates affect the weighted average cost of capital (WACC) calculation?

  31. What is considered a high debt-to-equity ratio and what does it say about the company?

  32. What are the best uses for trailing EPS, current EPS and forward EPS?

  33. How can the current ratio be misinterpreted by investors?

  34. What's the difference between weighted average cost of capital (WACC) and internal rate of return (IRR)?

  35. What are the main differences between the current ratio and the quick ratio?

  36. Why is earnings per share (EPS) also known as “The Bottom Line”?

  37. How do I start using technical analysis?

  38. What is the difference between weighted average shares outstanding and basic weighted average shares?

  39. What does it mean when there is "price action"?

  40. What is a cross hedge?

  41. What is the difference between an options contract and a futures contract?

  42. What is the McGinley Dynamic?

  43. Do stocks that trade with a large daily volume generally have less volatility?

  44. Why is the 1982 AT&T breakup considered one of the most successful spinoffs in history?

  45. Which two companies underwent the biggest corporate merger of the 1990s?

  46. When holding an option through expiration date, are you automatically paid any profits, or do you have to sell the option and pay commissions?

  47. How do I use the Nova/Ursa ratio?

  48. How do I value the shares that I own in a private company?

  49. How do I employ a cash-and-carry trade?

  50. What is the significance of a Schedule 13D?

  51. What is high-frequency trading?

  52. Does the balance sheet always balance?

  53. What is the difference between an acquisition and a takeover?

  54. What does it mean when "N/A" appears for a company's P/E ratio?

  55. What was the first company with a $1 billion market cap?

  56. What is the Coppock curve?

  57. Why would a company do a reverse merger instead of an IPO?

  58. What is the difference between return on equity and return on capital?

  59. What are the penalties for withdrawing from my Traditional IRA less than a year after acquisition?

  60. How do I use a premium put convertible?

  61. What business processes were used to establish the Chevrolet motor company?

  62. Why do option volume quotes differ on different websites?

  63. Is there such a thing as a nano cap or micro cap index?

  64. How do I measure option liquidity?

  65. I keep hearing about the 50-day, 100-day and 200-day moving averages. What do they mean, how do they differ from each other, and what causes them to act as support or resistance?

  66. Why do futures' prices converge upon spot prices during the delivery month?

  67. What do the different colored candlesticks mean?

  68. Who is Mr. Copper?

  69. How do I use a "basket" option?

  70. What do the phrases "sell to open", "buy to close", "buy to open", and "sell to close" mean?

  71. What is the weighted average of outstanding shares? How is it calculated?

  72. Can I make money using put options when prices are going up?

  73. When computing the PEG ratio for a stock, how is a company's earnings growth rate determined?

  74. Do noise traders have any long-term effect on stock prices?

  75. How do you determine a company's percentage of credit sales?

  76. What is a split-adjusted share price?

  77. In the forex market, how is the closing price of a currency pair determined?

  78. What is the difference between a merger and a takeover?

  79. What is a stock-for-stock merger and how does this corporate action affect existing shareholders?

  80. How do businesses decide whether to do FDI via green field investments or acquisitions?

  81. When is a takeover bid legally canceled?

  82. Which of the following terms are associated with the purchase/redemption of open-end investment company shares?

  83. What are pro forma earnings?

  84. What is the cheapest, fastest way to research, buy and trade stock?

  85. My brokerage firm won't allow naked option positions. What does this mean?

  86. Which is the best index to use to study the possible future price action of a given small-cap stock?

  87. Can investors short sell pink sheet or over-the-counter stocks?

  88. At what point in the ordering process does a broker charge commission?

  89. Where can I find a list of all of the stocks in the S&P 500?

  90. What's the difference between absolute P/E ratio and relative P/E ratio?

  91. Can technical analysis be called a self-fulfilling prophecy?

  92. What do the "BxA" numbers on my brokerage's trading screen mean?

  93. Where can I find information about pre- and after-hours trading on the NYSE and the Nasdaq?

  94. What should I use as a benchmark for my small-cap stock portfolio?

  95. What happens to the stock prices of two companies involved in an acquisition?

  96. What does it mean to use technical divergence in trading?

  97. What is Fibonacci retracement, and where do the ratios that are used come from?

  98. What does the term "stock-for-stock" mean?

  99. When does one sell a put option, and when does one sell a call option?

  100. Why would a multinational corporation conduct a vertical foreign direct investment?

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