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Definition of fundamental analysts
analysts who attempt to find under- or overvalued securities by analyzing fundamental information, such as earnings, asset values, and business prospects.
Also called securities analysts and investment analysts, professionals who analyze
Security analysis that seeks to detect misvalued securities by an analysis of the firm's
The product of a statistical model to predict the fundamental risk of a security using not
In the model for calculating fundamental beta, ratios in risk indexes other than
Related: financial analysts
Also called chartists or technicians, analysts who use mechanical rules to detect changes
Investors who attempt to identify over- or undervalued stocks by searching for patterns in past prices.
Process of analyzing financial statements of a company for any continuing relationship.
A financial analysis technique that relates key amounts on the income statement and balance sheet to a 100 percent or base figure for the present and previous year.
A method developed by BARRA, a consulting firm in
An analysis of the level of sales at which a project would make zero profit.
Sources of funds internally provided from operations that alter a company's
A statistical technique that identifies clusters of stocks whose returns are highly correlated
The representing of accounting information over multiple years as percentages
Comparative credit analysis
A method of analysis in which a firm is compared to others that have a desired
Corporate financial management
The application of financial principals within a corporation to create and
Corporate financial planning
financial planning conducted by a firm that encompasses preparation of both
Country financial risk
The ability of the national economy to generate enough foreign exchange to meet
The process of analyzing information on companies and bond issues in order to estimate the
A statistical process that links the probability of default to a specified set of financial ratios.
Dupont system of financial control
Highlights the fact that return on assets (ROA) can be expressed in terms
A statistical procedure that seeks to explain a certain phenomenon, such as the return on a
Claims on real assets.
The management of a firm's costs and expenses in order to control them in relation to
Events preceding and including bankruptcy, such as violation of loan contracts.
Financial distress costs
Legal and administrative costs of liquidation or reorganization. Also includes
Combining or dividing existing instruments to create new financial products.
A contract entered into now that provides for the delivery of a specified asset in exchange
Institutions that provide the market function of matching borrowers and lenders or
Long-term, non-cancelable lease.
Use of debt to increase the expected return on equity. financial leverage is measured by
Financial leverage clientele
A group of investors who have a preference for investing in firms that adhere to
Financial leverage ratios
Related: capitalization ratios.
An organized institutional structure or mechanism for creating and exchanging financial assets.
Objectives of a financial nature that the firm will strive to accomplish during the period
A financial blueprint for the financial future of a firm.
The process of evaluating the investing and financing options available to a firm. It
That portion of the media devoted to reporting financial news.
The result of dividing one financial statement item by another. Ratios help analysts interpret
The risk that the cash flow of an issuer will not be adequate to meet its financial obligations.
An analysis of returns using total return to assess performance over some investment horizon.
The process of dividing each expense item of a given year by the same expense item in
London International Financial Futures Exchange (LIFFE)
A London exchange where Eurodollar futures
Long-term financial plan
financial plan covering two or more years of future operations.
London International Financial Futures Exchange (LIFFE)
London exchange where Eurodollar futures as well as futures-style options are traded.
Evaluation of risky prospects based on the expected value and variance of possible outcomes.
Multiple-discriminant analysis (MDA)
Statistical technique for distinguishing between two groups on the
Include such things as freight, insurance, passenger services, and travel.
Notes to the financial statements
A detailed set of notes immediately following the financial statements in
Perfectly competitive financial markets
Markets in which no trader has the power to change the price of
Performance attribution analysis
The decomposition of a money manager's performance results to explain
Pro forma capital structure analysis
A method of analyzing the impact of alternative capital structure
Pro forma financial statements
financial statements as adjusted to reflect a projected or planned transaction.
A statistical technique that can be used to estimate relationships between variables.
The use of horizon analysis to project bond total returns under different reinvestment rates
analysis of the effect on a project's profitability due to changes in sales, cost, and so on.
Short-term financial plan
A financial plan that covers the coming fiscal year.
Society for Worldwide Interbank Financial Telecommunications (SWIFT)
A dedicated computer network to support funds transfer messages internationally between over 900 member banks worldwide.
Statement of Financial Accounting Standards No. 8
This is a currency translation standard previously in
Statement of Financial Accounting Standards No. 52
This is the currency translation standard currently
Security analysis that seeks to detect and interpret patterns in past security prices.
The process of dividing each expense item in the income statement of a given year by net
Cost–volume–profit analysis (CVP)
A method for understanding the relationship between revenue, cost and sales volume.
The production of financial statements, primarily for those interested parties who are external to the business.
Financial reports or statements
The Profit and Loss account, Balance Sheet and Cash Flow statement of a business.
The accounting period adopted by a business for the production of its financial statements.
A method of analysing financial reports to interpret trends and make comparisons by using ratios – two numbers, with one generally expressed as a percentage of the other.
An approach to understanding how changes in one variable of cost–volume–profit analysis are affected by changes in the other variables.
A method of budgetary control that compares actual performance against plan, investigates the causes of the variance and takes corrective action to ensure that targets are achieved.
A method of relating numbers from the various financial statements to one another in order to get meaningful information for comparison.
capital investment analysis
Refers to various techniques and procedures
statement of financial condition
See balance sheet.
The equity (ownership) capital of a business can serve
financial reports and statements
financial means having to do with
The process of using financial ratios, calculated from key accounts
the process of detailing the various repetitive actions that are performed in making a product or
an analytical technique that uses statistical
cost-benefit analysis the analytical process of comparing the
relative costs and benefits that result from a specific course
cost driver analysis
the process of investigating, quantifying,
a discipline in which historical, monetary
a plan that aggregates monetary details
a monetary reward provided for performance
a process of evaluating changes that
least squares regression analysis
a statistical technique that investigates the association between dependent and independent variables; it determines the line of "best fit" for a set of observations by minimizing the sum of the squares
a method of ranking the causes of variation
a process of determining the amount of change that must occur in a variable before a different decision would be made
the process of categorizing the nature (favorable or unfavorable) of the differences between standard and actual costs and determining the reasons for those differences
Statistical analysis techniques that quantify the
The 80:20 ratio that states that 20% of the variables included in an
analysis of the level of sales at which the company breaks even.
chief financial officer (CFO)
Officer who oversees the treasurer and controller and sets overall financial strategy.
costs of financial distress
Costs arising from bankruptcy or distorted business decisions before bankruptcy.
Procedure to determine the likelihood a customer will pay its bills.
Claims to the income generated by real assets. Also called securities.
Firm that raises money from many small investors and provides financing to businesses or other
Debt financing amplifies the effects of changes in operating income on the returns to stockholders.
Markets in which financial assets are traded.
Risk to shareholders resulting from the use of debt.
Ready access to cash or debt financing.
Project analysis given a particular combination of assumptions.
analysis of the effects of changes in sales, costs, and so on, on project profitability.
Estimation of the probabilities of different possible outcomes, e.g., from an investment project.
The calculation and comparison of the costs and benefits of a policy or project.
Any institution, such as a bank, that takes deposits from savers and loans them to borrowers.
The process whereby financial intermediaries channel funds from lender/savers to borrower/spenders.
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