The conversion ratio determines how much equity an investor can receive by exercising a convertible security. Here's how its used in investing and finance.

There are dozens of financial ratios and their meanings help business owners evaluate the financial health of a company. Financial ratios can be broken into six key areas of analysis: liquidity, ...

The debt-to-equity (D/E) ratio is a financial metric that measures a company's financial leverage by comparing its total debt to shareholders' equity. It indicates how much debt a company uses to ...

A financial ratio compares different sets of data to measure certain aspects of a company, such as its operating performance and financial strength. A financial ratio typically consists of a numerator ...

A balance sheet is one of two standardized financial reports produced on a regular basis. It provides information used by professionals in the financial community to analyze company performance and ...

A country’s debt-to-GDP ratio is a metric that expresses how leveraged a country is by comparing its public debt to its annual economic output. Just like people and businesses, countries often need to ...

The Treynor ratio is a tool in portfolio analysis that helps investors assess how well a portfolio compensates them for taking on market risk, also known as systematic risk. This portfolio ratio shows ...

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle. Andy Smith is a Certified Financial ...

Equity-to-asset ratio indicates how much of a company is owned versus debt-leveraged. To calculate, divide total equity by total assets; e.g., $4M/$5M = 80%. Compare ratio to industry to assess ...

Liquidity ratios assess if a company can cover short-term debts with available assets. Key ratios include cash, quick, current, and operating cash flow ratios. A liquidity ratio over 1 suggests a ...

Financial metrics such as P/E ratios, price to cash flow ratios, PEG ratios, price to sales ratios, price to book value, and many others, should be thought of as tools in the investor’s toolbox. They ...