Category Archives: Investment

This category shares posts for those who are just starting a career in finance or are in the midst of establishing their own investment portfolio

What is Expected Return? How to calculate it

The expected return (also known as expected gain) is the profit or loss that an investor anticipates on an investment that has known historical rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these results.

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What is Return on Investment (ROI)? How to calculate it

Return on Investment (ROI) is a performance measure used to evaluate the efficiency or profitability of an investment relative to the cost of the investment in percentage. It can be used to compare the efficiency of a number of different investments by directly measuring the amount of return on a particular investment, relative to the investment’s cost.

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What is stock / investment Beta (β) coefficient? How to calculate Beta

Beta (β), meaning in stocks and investment, also known as risk coefficent, is a measure of a stock’s volatility in relation to the overall market and can be used to measure a stock’s level of risk in the stock market.

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What is Equity Market Capitalization (EMC)?

EMC, usually referred to as market capitalization or market cap, is the total value of a publicly traded company’s outstanding common shares owned by stockholders. It is calculated by multiplying the price of a stock by its total number of outstanding shares. For example, a company with 20 million shares selling at $50 a share would have a market cap of $1 billion.

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What is Enterprise Value (EV)?

Enterprise value (EV), a.k.a total enterprise value (TEV) or firm value (FV), is a metric to reflect the market value of a business and is often used as a more comprehensive alternative to EMC (equity market capitalization). It is a sum of claims by all claimants: creditors (secured and unsecured) and shareholders (preferred and common). Enterprise value is one of the fundamental metrics used in business valuation, financial analysis, accounting, portfolio analysis, and risk analysis.