Terms
What does EBITDA stand for?
Earnings before interest, taxation, depreciation, and amortization.
Profit Margin
NI/Sales
What ratio is calculated as a company’s stock price divided by earnings per share?
PE
Are the US exchanges thinking about the ability to trade 24/7
yes
NVDA
Nividia
What is beta a proxy for?
Risk
Inventory turnover
COGS/end inv
Buying an asset with borrowed money is called what?
Leverage/Margin
The idea of “dont put all your eggs in one basket”
Diversification
APH
Amphenol
What is alpha?
Alpha is a measure of an investment's performance relative to a benchmark index, indicating the value added by a portfolio manager's investment decisions.
Asset turnover
Sales/ Assets
This valuation approach estimates a company’s worth by comparing it to similar firms using ratios like EV/Sales or EV/EBITDA.
Comparable/market comps
What is the first sale of a company’s stock to the public called?
Initial public offering
DPZ
Dominios pizza
What's a Debt covenant?
A debt covenant is a restriction or condition imposed by lenders on borrowers as part of a loan agreement.
Dupont ROE
PM*Asset turnover*Equity multiplier
Which Credit rating is considered "Junk"
BB
This type of index weighting gives each company the same influence on index performance, regardless of market cap.
Equally weighting
LUV
Southwest airlines
how much reinvestment is required to sustain growth.
Market debt to assets ratio
Mrkt val of debt/ market val of debt+equity
What was the specific financial instrument Michael Burry used to bet against the housing market?
Credit Default Swaps (CDS)
This anomaly, identified by Jegadeesh and Titman, shows that stocks with strong returns over the past 3–12 months tend to continue outperforming — but reverses over longer horizons due to mean reversion.
Momentum effect
MO
Altria (formerly known as Philip Morris)