What is a pure play?

June 30, 2024 No Comments

A: A pure play is a company that invests its resources in only one line of business. As such, this type of stock has a performance that correlates highly to the performance of the stock’s particular industry. For example, many electronic retailers or “e-tailers” are

What is a relative standard error?

June 30, 2024 No Comments

A: In statistics, a relative standard error, or RSE, is equal to the standard error of a survey estimate divided by the survey estimate and then multiplied by 100. The number is multiplied by 100 so it can be expressed as a percentage. The RSE

What is accrual accounting in Oracle Apps?

June 30, 2024 No Comments

Oracle Applications are the interactive business software products of the Oracle Corporation, which is one of the world’s leading financial and accounting software companies. Certain Oracle Applications, most notably the Oracle Financials Accounting Hub (FAH), perform accounting functions. Through FAH, users can create auditable and

What is an asset?

June 30, 2024 No Comments

A: An asset is anything of value or a resource of value that can be converted into cash. Individuals, companies, and governments own assets. For a company, an asset might generate revenue or the company might benefit in some way from owning or using the asset.

What is capital structure theory?

June 30, 2024 No Comments

A: In financial management, capital structure theory refers to a systematic approach to financing business activities through a combination of equities and liabilities. Competing capital structure theories explore the relationship between debt financing, equity financing and the market value of the firm. Traditional Approach According

What is considered a good net debt-to-equity ratio?

June 30, 2024 No Comments

A: The optimal debt to equity (D/E) ratio varies widely by industry, but the general consensus is that it should not be above 2. While some very large companies in fixed asset-heavy industries may have ratios higher than 2, these are the exception rather than

What industries use the loan to value ratio?

June 30, 2024 No Comments

A: The financial sector and mortgage investment industry use the loan-to-value ratio to assess the lending risk of mortgages. Calculate the loan-to-value ratio by dividing the mortgage amount by the property’s appraised value. Lenders evaluate a mortgage’s loan-to-value ratio before they underwrite the loan. Generally,

What investments are considered liquid assets?

June 30, 2024 No Comments

A: A liquid asset is cash on hand or an asset that can be readily converted to cash. An asset that can readily be converted into cash is similar to cash itself because the asset can be sold with little impact on its value. (For

What is a “non linear” exposure in Value at Risk (VaR)?

June 30, 2024 No Comments

A: The value at risk (VaR) is a statistical risk management technique that determines the amount of financial risk associated with a portfolio. There are generally two types of risk exposures in a portfolio: linear or nonlinear. A portfolio that contains a significant amount of

What is a back door listing?

June 30, 2024 No Comments

A: A back door listing, sometimes referred to as a reverse takeover, reverse merger, or reverse initial public offering (IPO), occurs when a privately held company that may not qualify for the public offering process purchases a publicly traded company. By undertaking a back door

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