finance
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Deferred Revenue vs. Accrued Expense: Understanding the Key Differences
Deferred Revenue vs. Accrued Expense: An Overview Deferred revenue, also known as unearned revenue, refers to advance payments a company receives for products or services that are to
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EPS vs. DPS: Understanding Earnings Per Share and Dividends Per Share
Earnings Per Share (EPS) vs. Dividends Per Share (DPS): An Overview Earnings per share (EPS) and dividends per share (DPS) are both reflections of a companys profitability, but thats where any
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Spin-Offs, Split-Offs & Carve-Outs: Understanding Corporate Restructuring
Spin-Off vs. Split-Off vs. Carve-Out: An Overview A spin-off, split-off, and carve-out are different methods a company can use to divest certain assets, a division, or a subsidiary. W
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Geometric Mean in Investing: A Comprehensive Guide
Understanding portfolio performance, whether for a self-managed, discretionary portfolio or a non-discretionary portfolio, is vital to determining if the portfolio strategy is working or needs to be
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CAPM Model: Understanding Advantages & Disadvantages
The widely used capital asset pricing model (CAPM)—when put into practice—has both pros and cons. CAPM Model: An Overview The capital asset pricing model (CAPM) is a finance theory that esta
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Residual Income Method: A Comprehensive Valuation Guide
There are many different methods of valuing a company or its stock. One could opt to use a relative valuation approach, comparing multiples and metrics of a firm in relation to other companies withi
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Decoding Annual Reports: A Guide for Investors
A companys annual report is the single most important way for potential investors to understand the financial state of a company. A company annual report is also a marketing tool designed to attract
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Understanding Company Capital Structure: A Guide for Investors
If you are a stock investor who likes companies with good fundamentals, then a strong balance sheet is important to consider when seeking investment opportunities. By using three broad types of meas
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Understanding Internal Rate of Return (IRR): A Comprehensive Guide
The internal rate of return (IRR) is frequently used by companies to analyze profit centers and decide between capital projects. But this budgeting metric can also help you evaluate certain financia
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Understanding EBITDA: What It Is and Its Limitations
Normally, investors focus on cash flow, net income, and revenues as the basic measures of corporate health and value. But over the years, another measure has crept into quarterly reports and account
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Momentum Indicators: A Comprehensive Guide for Traders
What Are Momentum Indicators? Momentrum indicators are technical analysis tools used to determine the strength or weakness of a stocks price. Momentum measures the rate of the rise or fall of s
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Understanding Liquidity Risk: Definition, Causes & Impact
What Is Liquidity Risk? Liquidity is the ability of a firm, company, or even an individual to pay its debts without suffering catastrophic losses. Conversely, liquidity risk stems from the
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NPV Limitations: Understanding the Drawbacks of Net Present Value in Investment Decisions
While net present value (NPV) calculations are useful when evaluating investment opportunities, the process is by no means perfect. NPV is a useful starting point but its not a definitive metric tha
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Understanding WACC: A Key Metric for Share Valuation
When market indices soar to ever dizzying new highs and seem divorced from reality, its time to get back to the fundamentals. Specifically, its time to look at a key aspect of share valuations: the
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Understanding Variability in Data and Investments
What Is Variability? Variability, almost by definition, is the extent to which data points in a statistical distribution or data set diverge—vary—from the average value, as well as the extent t
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Understanding Type II Errors: Causes, Consequences & Examples
What Is a Type II Error? A type II error is a statistical term used within the context of hypothesis testing that describes the error that occurs when one accepts a null hypothesis that is actu
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Sum of Squares in Regression Analysis: Definition & Formula
What Is the Sum of Squares? Sum of squares is a statistical technique used in regression analysis to determine the dispersion of data points. In a regression analysis, the goal is to determine
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Statistical Significance: Understanding & Importance
What Is Statistical Significance? Statistical significance refers to the claim that a result from data generated by testing or experimentation is not likely to occur randomly or by chance but i
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Understanding Sampling Error: Causes & Implications
What Is a Sampling Error? A sampling error is a statistical error that occurs when an analyst does not select a sample that represents the entire population of data. As a result, the results fo
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R-Squared Explained: Understanding Regression Model Explained
What Is R-Squared? R-squared (R2) is a statistical measure that represents the proportion of the variance for a dependent variable thats explained by an independent variable or variables in a r
finance
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Savings Strategies: Increase Income vs. Reduce Expenses - Which is Best?Here's how to figure out the ri...
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Top Banks for Demat Accounts in India - 2024For trading in Indian stock market, the first and foremost step is the opening of a Demat account. SEBI (Securities Exchange Board of India) has made it mandatory for every investor and trader to...
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Credit Card Rewards & Taxes: What You Need to KnowOver the past 12 months, I have used credit card rewards to finance the bulk of our trips to Jamaica, Las Vegas, Denver, New Orleans, London, Paris, and St. Maarten. And in the process, Ive also ...
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Develop a Winning Cryptocurrency Trading Strategy: A Step-by-Step GuideNowadays, trading in bitcoin is prevalent, but you need the right strategy if you want to do it. Designing a plan before entering the bitcoin trading world is very important because it will help you...