Fundamentals

Why is the automotive sector a good choice for value investing?
Discover the reasons that make the automotive sector a good choice for value investing. The automotive sector is highly leveraged ... 
What are the risks of investing in a company that has a high net debt?
Learn how indebtedness affects investment risk. Find out which other factors to considered in fundamental analysis and if ... 
Calculating Net Interest Margin
Net interest margin is a metric used to measure the effectiveness of a company’s investment decisions, particularly financial ... 
What More Volatility Means For Momentum Stocks
One byproduct of the recent tick higher in bond yields: a meaningful rise in volatility for both stocks and bonds. 
If my brotherinlaw, who works at a pharmaceutical company, tells me about his research ...
Discover what tier 1 capital measures about a bank. Tier 1 capital levels were mandated by Basel III following the financial ... 
What are the consequences of one party violating the terms of a letter of intent?
Learn what the average profit margin is for a company in the chemicals sector and what to look for when interpreting high ... 
How legitimate are companies that advertise debt consolidation for all my credit ...
Learn about how fundamental analysis ratios can be combined with quantitative stock screening methods and how technical indicators ... 
What does the booktobill ratio in the electronics sector refer to?
Understand the purpose of operations management and learn specific ways that businesses use data collection and analysis ... 
How To Value Airline Stocks
We explain what drives the stocks of airline companies and how best to assess their values. 
How many years can structural unemployment last?
Understand the two different types of price elasticities, and learn how each one affects the stock purchasing decision of ... 
What are some of the wellknown noload funds?
Find out more about the capital to riskweighted assets ratio, what the ratio measures and the formula used to calculate ... 
What can cause the marginal propensity to consume to change over time?
Learn about the dividend payout ratio and dividend yield, what the ratios measure and the difference between the dividend ... 
What is the difference between a spot rate and a forward rate?
Understand the concept of intangible assets and learn how they are handled in the purchase agreement when a company is bought ... 
What is the risk return tradeoff for bonds?
Find out more about the Macaulay duration and modified duration, how to calculate them and the difference between the Macaulay ... 
Which is more important to economists, the marginal propensity to consume or the ...
Find out more about economic profit, the formula used for calculating economic profit and how to calculate a company's economic ... 
What is the risk return tradeoff for stocks?
Learn more about the Macaulay duration, how to calculate the Macaulay duration for a bond and how the Macaulay duration is ... 
How do companies benefit from price discrimination?
Learn what the average pricetoearnings ratio is for the insurance sector and why the average pricetoearnings ratio should ... 
What is the difference between a primary and a secondary market?
Examine the return on assets ratio as it relates to the insurance industry, and learn what the industry average is for return ... 
Which companies in the chemicals sector pay the highest dividends?
Learn what the average annual dividend yield of insurance companies is and which factors should be considered when choosing ... 
What are the benefits and shortfalls of the HerfindahlHirschman Index?
Learn about the differences between equity and debt financing and how they impact financials. Find out how businesses determine ... 
What happens to the intangible assets of a company when it is bought or sold?
Discover the bestperforming stock market sectors over the past five years and learn which sectors continue to offer high ... 
Should I expect growth or income from buying stock in the consumer packaged goods ...
Find out how annual returns are expressed in financial statements. How do fundamental investors measure annual returns? What ... 
What is the difference between Macaulay duration and modified duration?
Find out more about the forward price to earnings ratio and how to calculate the forward price to earnings ratios of companies ... 
Why should I register as a Limited Liability Company (LLC) if I am selfemployed ...
Understand the difference between a company's levered beta and unlevered beta. Learn how debt affects a company's levered ... 
How does the International Monetary Fund function?
Learn how expenditures and distributions affect the fixed charge coverage ratio, and how this ratio is used to evaluate a ... 
How Microsoft & Apple's Balance Sheets Compare
Looking at two iconic companies, Microsoft and Apple, whose balance is sheet is stronger and where? 
How does equity financing affect a company's financials compared with the effects ...
Understand the formula used for calculating a company's sustainable growth rate and the factors that influence changes in ... 
Which financial instruments have par values?
Understand the difference between shortterm investments and marketable equity securities, and learn the importance of shortterm ... 
How do unfunded capital expenditures and distributions affect the fixed charge coverage ...
Learn about the most common solvency ratio and what it measures. Understand two other liquidity ratios that are commonly ... 
How do stock dividends affect the retained earnings account?
Understand the difference between financial ratio analysis and accounting ratio analysis. Learn why ratio analysis is important ... 
How does monetary policy influence the Fisher effect?
Find out if paidup capital generated by the sale of stock has to be repaid by the issuing company and how these funds are ... 
How does debt affect a company's beta?
Learn what the average debttoequity ratio is for companies operating in the Internet sector. Understand why Internet companies ... 
How do I create grouping schedule codes and subcodes for trial balances?
Find out more about the payback period, what it measures and how to calculate the payback period of a company's project using ... 
SmallCap Biotech Stocks to Watch
Home runs in the small cap biotechnology market are hard to come by. Here are some names to watch. 
Key Financial Ratios for Pharma Stock Investing
Analysts simplify the business of investing in pharma by studying key financial ratios and metrics. Know these metrics before ... 
Can You Invest in China's Huawei?
Have you heard of giant Chinese telecom maker Huawei? Here's what you need to know. 
Who Are Netflix's Main Competitors?
Netflix has many competitors, but is that really what current and potential shareholders should be worried about? 
What is the average debt/equity ratio for the Internet sector?
Learn about how debit option spreads work, including their maximum profit and loss, and understand how time decay impacts ... 
What is the difference between a currency and interest rate swap?
Learn what the average return on equity for a company in the electronics sector is and what factors influence changes in ... 
What does it mean if a bond has a zero coupon rate?
Learn what the average range for the price to earnings (P/E) ratio in the electronics sector is and which factors influence ... 
What are some examples of just in time (JIT) inventory processes?
Learn about the average annual dividend yield for companies in the chemicals sector, the range of dividend yields and which ... 
Why are coupon payments considered an annuity?
Learn about the average debt to equity (D/E) ratio for firms in the electronics sector and what the median D/E ratio is and ... 
What are some examples of overhead treatment in cost accounting?
Learn about the average pricetobook ratio in the chemicals sector, the range of pricetobook ratio and the median value ... 
How do you determine a tangible asset's useful life?
Learn what the average return on equity for a company in the chemicals sector is and what factors influence changes in the ... 
What is the difference between a bond's coupon rate and yield to maturity?
Learn what the average profit margin is for a company in the electronics sector and what to look for when interpreting high ... 
What factors drive share prices in the aerospace sector?
Learn about the average annual dividend yield for companies in the electronics sector and understand why the average is a ... 
Is Amazon Overvalued? Compare PriceToSales Ratios
The pricetoearnings (P/E) ratio is the most common and easiest valuation metric to calculate. But what happens when earnings ... 
How is investing in a corporate bond different from buying shares of the company's ...
Learn what the just in time, or JIT, inventory system is by contrasting it with the just in case inventory system and reviewing ... 
Which consumer goods do Americans buy the most of?
Explore the various factors that influence estimations of a tangible asset's useful life, as well as standard estimations ... 
Explaining Debt
Debt is any amount a borrower owes a lender.
Hot Definitions

Purchasing Power
The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing ... 
Real Estate Investment Trust  REIT
A REIT is a type of security that invests in real estate through property or mortgages and often trades on major exchanges ... 
Section 1231 Property
A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ... 
Term Deposit
A deposit held at a financial institution that has a fixed term, and guarantees return of principal. 
ZeroSum Game
A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ... 
Capitalization Rate
The rate of return on a real estate investment property based on the income that the property is expected to generate.
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