What is Weighted Average Cost of Capital?
The Weighted Average Cost of Capital (WACC) is a crucial financial metric that represents a company’s overall cost of financing its assets. It is used by businesses and investors to determine the minimum return required on an investment to maintain its financial health. WACC considers both equity and debt financing, weighting each component according to […]
Why Select the Turo and its investments platform?
Turo is providing an interactive platform for the investors, and the investors are getting the interactive platform. You can get all the benefits and the profitability without any real effort. All you need to do is provide a car to Turo and get the monthly profitability. This is the main reason Turo is an attractive […]
Write a short note on financial swaps
A financial swap is a derivative contract in which two parties agree to exchange cash flows based on a specified underlying asset or financial instrument. Financial swaps are commonly used by financial institutions, corporations, and investors to manage risk and optimize their financial positions. Types of Financial Swaps There are several types of financial swaps, […]
What is Interest Rate Parity Theory (IRPT)?
Interest Rate Parity Theory (IRPT) is a concept in international finance that attempts to explain the relationship between exchange rates and interest rates. It is a fundamental principle that governs the behaviour of foreign exchange markets, and understanding it is crucial for anyone involved in global trade or investment. At its core, IRPT suggests that […]
What is a Funds Flow Statement?
A funds flow statement is a financial statement that shows how funds have moved in and out of business during a specific period of time. It is a tool used by businesses to understand their cash flow and identify areas where they can improve their financial position. The funds flow statement captures the movement of […]
What is an Ideal Current Ratio?
The current ratio is a financial metric that measures a company’s ability to pay its short-term liabilities with its short-term assets. It is calculated by dividing current assets by current liabilities. The resulting ratio provides insight into a company’s liquidity and ability to meet its current obligations. An ideal current ratio varies depending on the […]
What are different types of annuities
Annuities are financial instruments that guarantee a regular income stream, normally utilized for retirement planning. They are provided by insurance firms and exist in several forms, each serving different financial objectives and risk tolerances. The most common annuity types are fixed, variable, indexed, and immediate or deferred annuities. A fixed annuity offers a guaranteed return, […]
Treasury Bills and Commercial Paper Explained
Treasury bills, or T-bills, are short-term financial securities issued by both the federal and provincial governments having maturities of up to one year. Treasury bills typically have maturities of a few weeks to a few months, with the most common maturities being 91 days, 182 days, and 364 days. Treasury bills do not carry periodic […]
Earnings Per Share | How to Calculate EPS?
Earnings per share (EPS) represents the proportion of a company’s net income assigned to each outstanding share of ordinary stock. Many financial professionals believe that EPS is the essential metric for determining the market price of a stock. Earnings per share that are high or rising can cause a stock’s price to rise. Inversely, declining […]
What are the Opportunity Costs? Meaning and Examples
Opportunity costs refer to the benefits lost or profits that are sacrificed while choosing an option over another one that has been chosen. When choosing between two alternative options, only one can typically be chosen. When this occurs, you may incur opportunity costs for choosing one option over another. For instance, if you are deciding […]