Stocks FAQs

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

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

How do you calculate working capital?

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

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

How do you calculate return on equity (ROE)?

Why is the compound annual growth rate (CAGR) misleading when assessing longterm growth rates?

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

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

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

How do I calculate the inventory turnover ratio?

Why is return on investment (ROI) a bad measure for calculating longterm investments?

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

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

How can the pricetoearnings (P/E) ratio mislead investors?

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

Is there value in comparing companies from different sectors by using the debttoequity ratio?

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

What is the formula for calculating the current ratio?

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

What is considered a high debttoequity ratio and what does it say about the company?

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

How can the current ratio be misinterpreted by investors?

What is the formula for calculating the debttoequity ratio?

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

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

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

How do I start using technical analysis?

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

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

What is a cross hedge?

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

What is the McGinley Dynamic?

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

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

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

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

How do I use the Nova/Ursa ratio?

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

How do I employ a cashandcarry trade?

What is the significance of a Schedule 13D?

What is highfrequency trading?

Does the balance sheet always balance?

What is the difference between an acquisition and a takeover?

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

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

What is the Coppock curve?

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

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

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

How do I use a premium put convertible?

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

Why are P/E ratios generally higher during times of low inflation?

Is technical analysis used only to analyze stocks?

What is a staggered board?

How is spread calculated when trading in the forex market?

How can I determine a stock's next resistance level or target price?

What happens to my call options if the underlying company is bought out?

What is a typical day in the life of someone in M&A? How long does a project last?

What is a back door listing?

Where can I find the P/E ratios for the Dow and S&P 500?

What is the difference between fast and slow stochastics in technical analysis?

What is the difference between a simple moving average and an exponential moving average?

Do stop or limit orders protect you against gaps in a stock's price?

What is the best time of the day to trade?

How can I use market breadth to my advantage?

Can a company declare a dividend that exceeds its earnings per share?

What does it mean when a stock symbol has a .PK after it?

What's the difference between a regular option and an exotic option?

What does the 'FIG' at an investment bank refer to?

Is tracking error a significant measure for determining expost risk?

Is maximizing stock price the same thing as maximizing profit?

How can a futures trader exit a position prior to expiration?

What is the PacMan defense?

What is a penny stock?

Can a stock have a negative pricetoearnings (P/E) ratio?

Should I buy options that are in the money or out of the money?

If I reject the tender offer for acquisition of the stock that I own in a company and the company goes private, what happens to my stock?

What do the numbers that follow the bid and ask numbers in stock quotes represent?

What do you call a candlestick with no shadows, and what does it mean?

How do companies use the PacMan defense?

Why do option volume quotes differ on different websites?

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

How do I measure option liquidity?

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

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

What do the different colored candlesticks mean?

Who is Mr. Copper?

How do I use a "basket" option?

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

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

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

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

Do noise traders have any longterm effect on stock prices?

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

What is a splitadjusted share price?

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

What is the difference between a merger and a takeover?

What is a stockforstock merger and how does this corporate action affect existing shareholders?

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