Treynor ratio

FINANCIAL ANALYSIS LIQUIDITY RATIO Liquidity ratios are used to determine a company’s ability to meet its short-term debt obligations. Investors often take a close look at liquidity ratios when performing fundamental analysis on a firm. Since a company that is consistently having trouble meeting its short-term debt is at a higher risk of bankruptcy, liquidity ratios are a good measure of whether a company will be able to comfortably continue as a going concern. • Current ratio One of important…

Exercise 17-7 1. Current ratio = Current asset Current liability 2008 ($378,00+502,00+54,000+5,000 )/($51,250) = 2.87 : 1 2009 ($35,625+62,500+82,500+9,375)/($75,250) = 2.52 : 1 2010 ($31,800+89,500+112,500+10,700)/($129,900) = 1.88 : 1 The current ratio is declining from 2008 , 2.87 : 1 to 2010 ,1.88 : 1.Therefore, the short-term debt-paying ability for Simeon Company is decrease. 2. Acid –test ratio = cash+ short-term investment+ Current receivable…

profitability negatively. From their study, the firms could maximize their profitability by achieving the lowest level of leverage. Previous researches completed by Gill, Biger and Mathur (2010) and Lazaridis and Tryfonidis (2006) used financial debt ratio as a proxy of leverage. Both of their results indicated negative relationship between firm leverage and the dependent variable. This means that the leverage is inversely with the profitability of firms. The reason given by Lazaridis and…

Singapore’s total fertility rate has been steadily decreasing since 1970 from 3.07 to 1.19 in 2013 (Singapore Department of Statistics 2014, p. vi), a phenomenon that has mirrored other capitalist economies in Asia such as Japan, Taiwan, Hong Kong and South Korea. In fact, Singapore’s total fertility placed third lowest in these 5 Southeast Asian Countries (Wong 2012). Such a phenomenon has been a cause for widespread concern due to the host of societal problems it could potentially create such…

Earnings and profit are related, but not exactly the same. They are different in the terms of how they are calculated. Earnings and profit calculations are used to identify the financial health of a business. They are typically used in reporting business income to tax authorities. New business owners usually make mistakes, they want to see the large number of sales on financial statements, if the number of sales is high they think they are operating good, but they should actually look at how…

myriad ratio analyses can be performed to examine the financial health of the company. Analysis There are four categories of ratio analysis that measure different aspects of a company’s operations: profitability, short-term liquidity, long-term solvency, and market valuation. For this assessment, I calculated five financial ratios: gross profit margin, current ratio and quick ratio, and debt ratio and debt to equity ratio (Heisinger & Hoyle, 2012). Profitability Ratios Profitability ratios…

Market share and potential growth 4.1.1 As a small business, “Your Space” is not likely to achieve a significant share of the market as a whole. Within its geographical location of North Wales, however, it stands to gain a modest proportion. 4.1.2 According to the Instant Group survey, currently there are around 37 coworking spaces in Wales and only 5-7 are located in North Wales. 4.1.3 The market share at these conditions can be very high for location in Llandudno, as there is competition only…

2.2 Profit Determination Equation Profit is the amount whereby it is calculated with the formula, revenue minus expenses in a business (Appendix 3). The owner will obtain profit when the total revenue exceeded the total of expenses. What is a revenue? Revenue is an amount that the owner earned during the business period. For example, when the owner rents out one of his or her shoplot to others for business purposes, the owner will receive rental fee from them as a revenue which means profit.…

7% over the past five years. The second advisor tells the investor that the mutual fund has seen above-average returns in the past 10 years but has been declining in recent years. According to prospect theory, even though the investor is presented with the same mutual fund, he or she is more likely to buy the mutual fund from the first advisor, who expressed the rate of return as an overall 7% gain, rather a combination of both high returns and losses. Prospect theory is based on the…

hold only 31.7% of the industry market share, the remaining being held by many small companies, each with less than 5% of the market share. (Hurley) Foot Locker focuses mostly on athletic shoes, which represent 90% of their total sales. (Hurley) It holds the largest market share within the industry and as such its sales were about 2.5 times that of the other three competitors in 2014. (Foot Locker Inc. Form 10-K 2014) Payless ShoeSource, the main brand of Wolverine Worldwide, focuses mainly on…