Rationalization can refer to any of the following:
Rationalization (sociology), the means of transition from a traditional society into a rationalized one ...
Ratios and Formulas in Customer Financial Analysis
Financial statement analysis is a judgmental process.
Rationality Key 2: Remember that Money is a Means, not an End unto Itself
Money exists solely to serve a purpose. All of the effort you put into selecting stocks and bonds is simply so you can have a better life for yourself and your family.
Rational pricing is the assumption in financial economics that asset prices (and hence asset pricing models) will reflect the arbitrage-free price of the asset as any deviation from this price will be "arbitraged away".
PE ratio
The price/earnings ratio (PE) is the most commonly used valuation measure. It compares the price of a share to the EPS.
P/E Ratio stands for Price to Earnings Ratio. It is one of the most common statistics used to determine whether a company is fairly valued, under valued or over valued.
Ratio spread
This strategy, which applies to both puts and calls, involves buying or selling options at one strike price in greater number than those bought or sold at another strike price. Ratio spreads are typically designed to be delta neutral.
Definition
Ratio Hedge
The number of options compared to the number of futures contracts bought or sold in order to establish a hedge that is neutral or delta neutral.
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If fear affects even a $20 low-stakes game, you can bet it affects how people invest their life savings. When stock prices fall, investors get emotional and want to get out, even when the drop has no rational basis, ...
Ratios of Financial Condition
Evaluating the financial condition of a company consists of two related, but distinct, types of measures.
Ratios used to Test the adequacy of Cash flows generated through Earnings for purposes of meeting Debt and Lease obligations, including the Interest coverage Ratio and the fixed-charge coverage ratio.
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PE Ratio
Now we come to the most popular valuation measure- the Price to earnings ratio or the PE ratio, which can take you pretty far as long as you are aware of its limitations.
PE Ratio: - Price to Earning per share ratio
PE Ratio of a stock is calculated by dividing price of a stock on a particular day by usually its latest EPS. (Annual) ...
P/E Ratio
P/E Ratio
Also known as the P/E multiple, this is the latest closing price divided by the latest 12 months' earnings per share. P/E is perhaps the single most widely used factor in assessing whether a stock is pricey or cheap.
E/P ratio investment & finance definition
See earnings-price ratio.
Learn more about E/P ratio ...
P/E Ratio Formula
For example, if a stock is trading at $100 with and EPS of $5 the P/E ratio would equal 20 ($100/$5).
PEG ratio
The PEG ratio is a comparison between the price of a stock, a stock's P/E and the expected EPS yearly growth.
To calculate PEG: PEG = (price / annual earnings) / (% annual growth) ...
Put Ratio Vertical Spread
Components
Short two OTM put options and long one ITM put option.
Envy Ratio - envy ratio is a calculation used after a buy out of a company... This entails finding out how much the management company spent, versus the investment company, and then examining how much equity each party received...
Envy ratio in finance is the ratio of the price paid by investors to that paid by the management team for their respective shares of the equity. This metric is used when considering an opportunity for a management buyout.
Cash Ratio
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Cash and Cash Equivalents + Marketable Securities
Cash Ratio = ...
Quick Ratio
Can be calculated by subtracting a company's inventory from its current assets and dividing by the current liabilities. As an equation: Quick ratio= (Current assets- Inventory)/Current Liabilities.
Price Ratio (Relative Strength)
The Price Ratio (or relative strength - comparative) serves a similar purpose to Price Comparison - it compares the performance of one stock relative to another (or to an index).
Quick Ratio
Cash and cash equivalents plus accounts receivables divided by current liabilities.
Quote ...
current ratio
The liquidity ratio that measures a company's ability to pay off short-term obligations. The higher the ratio, the more liquidity the company has.
Current ratio - some related terms:
Current assets
Current liabilities
Liquidity ...
Company Ratios and Statistics You Need to Know
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Definition
Debt ratio
Indicates the proportion of total assets financed by a company's creditors. A higher ratio indicates that there is larger amount of other's money being used in an attempt to generate profits.
Ratio Call Spread
Option, Call Option, Put Option, Option Buyer, Option Seller, Puts and Calls
In-the-money, At-the-money, Out-of-the-money
Delta
The option strike price
Time Value Decay ...
Ratios have always been an excellent way of analysing financial performance, comparing and quantifying as they do the relationship between two (or more) distinct parameters.
A ratio that will help you look at future earnings growth is called the PEG ratio.
You calculate the PEG by taking the P/E and dividing it by the projected growth in earnings.
PEG = (P/E) / (projected growth in earnings) ...
PEG Ratio = Price Earnings/Annual EPS Growth
A lower PEG ratio is considered better as in such a case the investor would be paying less for each unit of earnings growth.
The ratio is considered to be an accurate gauge of the current level of desirability for the issue involved in the auction.
The ratio you choose depends on how conservative or aggressive you are as an investor. The higher the stock component, the more aggressive your portfolio will be.
Bond Ratio ...
The Ratio increased dramatically when the S&P 500 began making new highs in 1990. However, as the S&P has continued to move on to new highs, the Ratio has failed to reach new highs. This implies that the S&P 500 is weaker than it appears.
Calculation ...
A/D Ratio was brought from stock trading, where traders were calculating the difference between stocks listed on the New York Stock Exchange that advanced in price minus those that declined.
Example of how it looked in stock trading: ...
This ratio is also called the days to cover ratio because it is said to represent how many days it would take for all of the short positions to be closed. So in this case if something happened and the stock started moving up it would take 1.
Quick Ratio is the ratio that measures the ability of a firm to cover its current liabilities with their most liquid current assets. Quick Ratio = (Current Assets - Inventory) / Current Liabilities
Next Term:
Recession ...
The P/C Ratio is a contrarian indicator. When it reaches "excessive" levels, the market usually corrects by moving the opposite direction. The following table, general guidelines for interpreting the P/C Ratio.
Call/Put Ratio
This indicator is calculated by dividing the daily or weekly volume of call options by the daily or weekly volume of put options. Big call volume appears at market tops and big put volume at bottoms.
Put/Call Ratio
[ Glossary menu ]
When put volume becomes excessive in relation to call volume, it is an indication of excessive bearishness in the market, which is usually bullish.
Fibonacci Ratios are used by many traders and analysts and in a variety of ways. They are a central requirement to my style of analysis but must be used carefully and in a way in which helps you understand the market.
Financial ratios can shed light on how a bank earns its money. Does making loans provide most of its bread and butter? The Loans-to-Assets ratio is a good indicator of whether it does.
The Sharpe Ratio is a method that has been developed in order to determine whether or not particular investments are good or bad for your portfolio.
Expected Ratio
The alerts server often compares a stock to the futures or another stock. Based on historical data, some stocks typically move up and down at the same time as the futures. However, they don't always move the same amount.
Cash Flow Ratios - Measuring The Flow
In many cases, cash flow ratios signify a more accurate measurement of a stock's value than the price to earnings ratio, P/E.
The AD issues ratio is applied as follows:
Values higher than 1 show that more issues are presently advancing than declining;
Values between 0 and 1 indicate that more issues are currently declining in price.
Price/earnings ration (P/E) is a division of a company's market price over earnings per share. It is an indication of two important factors, the market price and earnings, and displayed in a relationship to each other.
PRICE/EARNINGS RATIO (P/E)
The price-to-earnings ratio (P/E) is the relationship between a company's earnings and its share price, and is calculated by dividing the current price per share by the earnings per share.
The Bull/Bear Ratio is a weekly vote by investment professionals, published by Investor's Intelligence magazine.
The risk reward ratio is simply a calculation of how much you are willing to risk in a trade, versus how much you plan to aim for as a profit target.
The price/sales ratio is:
Market Capitalization /Trailing Twelve Month Sales
Internet Stocks Started It ...
Risk-to-Reward Ratio
The risk method includes the money management method and manages risk by using an initial and trailing stop. The initial stop should be such that we always at minimum have a risk to reward ratio of 1 to 3.
Reward-to-Risk Ratio
Another way you can increase your chances of profitability is to trade when you have the potential to make 3 times more than you are risking.
New Highs/Lows Ratio (NYHL)
The NYHL measures the daily ratio between the number of stocks that approach new 52-week highs to the number that reach 52-week lows.
The Derivation of Rational Sign Predictions
Empirical Evidence
Model specification ...
The Price/Earnings ratio provides a quick comparison for determining whether a share is 'cheap' or 'expensive' as it measures how long it would take, in years, ...
What is a Price Earnings Ratio?
What is a Preferred Stock?
What is a Position?
What is a Penny Stock?
What is a Par Value?
What is a Nominal Yield?
What is a Minimum Margin?
What is a Mid-cap Stock?
What is a Market Order?
What is a Margin?
The P/E, however, is not a universal ratio and does not reveal the whole picture.
Backspreads, also known as reverse ratio spreads, are an option strategy utilized when you believe there will be much volatility in the stock but are not 100% sure whether it will go up or down.
 See also: Market, Stock, Trading, Profit, Analysis
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