Finance Glossary

Accounts Payable Turnover Ratio

The Account Payable Turnover Ratio (or APT ratio) is used to measure the length of time that is needed for a company to repay (liquidity of the company) its suppliers.

Accounts Payable Turnover Ratio = Cost of Goods sold/Accounts Payable

Acid Test Ratio

The Acid-Test ratio measures the short term liquidity of a company. During an Acid-Test analysis the short term assets are weighted against the current liabilities.

After-tax profit margin

Blue Chip Companies:

Large and creditworthy company.Company renowned for the quality and wideacceptance of its products or services, and for its ability to make Money and pay dividends.

Bollinger Bands

Bonds

Capitalisation:

The current market price value of a company’s entire issued securities. This figure includes every security type issued.

Central Banks

Current Ratio

Debt To Equity Ratio

Deflation

Diluted Shares:

All the shares, options, and warrants converted into shares at one point of time, usually at the end quarters.

Dividend preference shares:

Embodies higher dividend priority, but lower voting rights.

Earnings:

The net profit, that is after tax.

Earnings per Share (EPS)

Great Depression

Growth stocks:

Some companies’ stocks have shown or are expected to show quick earnings and revenue growth.

Liquidity:

Liquidity refers to how quickly and cheaply an asset can be converted into cash. Money (in the form of cash) is the most liquid asset.

Multiples

Non-Cash Charges

Options:

Give additional or differentiated rights of the holder of the shares.

Payout Ratio

PEG Ratio

Plowback Ratio

Price/Earnings per Share (P/E)

Price/Sales Ratio

Primary Shares:

All the shares that are issued and can currently be traded with on the exchanges.

Pro Forma:

The words indicate that assumptions were used to derive whatever number is being discussed.

Revenue:

The entire amount of income before any deductions are made.

Shares

Shares Outstanding:

The shares of a corporation's stock that have been issued and are in the hands of the public.

Stock Market Bubbles

Voting Preference Shares:

Give higher priority voting rights to other share types, but lower priority to dividend payments.

Warrants:

Types of options that the holder can, after a pre-set amount of time which usually is five to ten years, use.

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