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Home Dictionary R Risk Assessment Risk assessment is the process of analyzing potential events that could lead to the loss of an asset, loan or investment. Companies, governments and investors conduct risk assessments before embarking on a new project, business or investment. Quantitative risk analysis uses mathematical models and simulations to assign numerical values to risks. Qualitative risk analysis relies on human subjective judgment to build a theoretical risk model for a given scenario. Although past stock volatility does not guarantee future returns, in general, investments with high volatility indicate riskier investments. Cost of Revenue
September 25, 2022 Cost of sales is the total cost of producing and delivering a product or service to customers. Harvard MBA Indicator
September 25, 2022 The Harvard MBA indicator generates long-term market signals based on the proportion of new Harvard MBA graduates who take jobs in the securities markets. Addition Rule for Probabilities
September 25, 2022 The addition rule for probabilities consists of two rules or formulas, one of which takes into account two mutually exclusive events, and the other two non-mutually exclusive events. Adjusted EBITDA
September 25, 2022 Adjusted EBITDA excludes non-recurring, non-recurring and non-recurring items that may distort EBITDA. Adjusted Present Value (APV)
September 25, 2022 APV is the net present value of a project or company if funded solely by equity plus the present value of the financial benefits. Alternative Depreciation System (ADS)
September 25, 2022 The Alternative Depreciation System (ADS) is a method that allows taxpayers to calculate the amount of depreciation the IRS allows them to take on certain business assets. Analysis of Variance (ANOVA)
September 25, 2022 Analysis of variance, or ANOVA, is a statistical technique that separates observed data of variance into different components for use in additional tests. Asset Valuation
September 25, 2022 Asset valuation is the process of determining the fair market value of an asset. Autocorrelation
September 25, 2022 Autocorrelation is the degree of similarity between a given time series and its lagged version over successive time intervals. Basic Earnings Per Share (EPS)
September 25, 2022 Basic earnings per share (EPS) tells investors how much of a firm’s net income comes from each common share. Capacity Utilization Rate
September 25, 2022 The calculation of the capacity utilization rate accurately determines the degree to which the organization realizes its full production potential. Capitalized Interest
September 25, 2022 Capitalized interest is the cost of borrowing to obtain a long-term asset. Comparable Company Analysis (CCA)
September 25, 2022 Benchmarking is the process of comparing companies based on similar metrics to determine their corporate value. Conditional Probability
September 25, 2022 Conditional probability refers to the chances that some outcome will occur given that another event has occurred. Conditional Value at Risk (CVaR)
September 25, 2022 The notional value at risk is derived from the value at risk of the portfolio or investment. Confidence Interval
September 25, 2022 Confidence interval displays the probability that the parameter will be between a pair of values near the mean value. Debt/EBITDA Ratio
September 25, 2022 The debt/EBITDA ratio is used by creditors, appraisers and investors to assess the liquidity and financial condition of a company. Degree of Financial Leverage
September 25, 2022 Degree of financial leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s earnings per share to fluctuations in its operating income as a result of changes in its capital structure. Delphi Method
September 25, 2022 The Delphi method is a process used to obtain a group opinion or decision by asking a group of experts. Earnings
September 25, 2022 Profit refers to the profit of the company in a given quarter or financial year. Event Study
September 25, 2022 Event research or event history analysis examines the impact of an event on the financial performance of a security, such as a company’s stock. Expanded Accounting Equation
September 25, 2022 The advanced accounting equation is the same as the regular accounting equation, but capital is broken down into its component parts. Factor Investing
September 25, 2022 Factor investing uses many factors, including macroeconomic, as well as fundamental and statistical, which are used to analyze and explain asset prices and build an investment strategy. Fair Value
September 25, 2022 Fair value is the estimated price at which an asset is bought or sold when both the buyer and the seller freely agree on a price. Financial Performance
September 25, 2022 Financial indicators tell investors about the overall well-being of the company. This is a snapshot of her economic health and the work her management is doing.