Monthly Archives: June 2017
How car loans are different in a foreclosure
Most (but not all) states in the United States have some combination of “anti-deficiency laws” or “non-judicial foreclosure” proceedings, which prevent a bank or other lender from getting a deficiency judgment against a homeowner who has been foreclosed on… These rules prevent the lender from continuing to seek principal, interest, fees and expenses after the […]
On Argentine long bond, question is not if, but when?
Argentina has re-entered the global bond market with a bang, $2.75 billion of a 100 year bond… The 7.125s of 2117 were issued at 90c to yield 7.917%… 100 year issues are rare, even rarer when rated B3… Argentina has been in default during 38% of its 200 year history, so this bond is almost […]
Liquidity, Market Liquidity, and Accounting Liquidity
In a general economic sense, liquidity refers to how easily an asset can be bought or sold without an effect on the asset’s price. Cash is considered to be highly liquid since it can almost always be exchanged for goods and services. Other valuable items may be less liquid, or illiquid. For instance a rare […]
Posted in Uncategorized
What is an Activist Shareholder?
Amazon’s recent acquisition of Whole Foods was in large part due to pressure on Whole Foods co-founder John Mackey from activist investor Jana Partners. But just what is an activist investor? The rise of the activist investor, or activist shareholder, occurred during the 1980s. Investors like Carl Icahn and T. Boone Pickens began buying stock […]
Posted in Finance Glossary
Elasticity and Demand
In general economic terms, elasticity refers to how responsive a variable is to another variable. Most often, the term elasticity is applied to how demand for a product changes depending on the price. Mathematically, this is expressed as a ratio of the change in price to the change in quantity demanded. Elasticity = Percent […]
Posted in Finance Glossary
Expense Ratios Explained
In investing, an expense ratio refers to an annual fee that an investment company will charge to cover the operating costs of managing a mutual fund. An expense ratio will typically be calculated annually by dividing a fund’s operating expenses by the average dollar value of assets under management. The expense ratio not only includes […]
Posted in Finance Glossary
What is Free Cash Flow (FCF)?
Free cash flow, often abbreviated as FCF, is a common measure of a company’s financial performance. It is determined by subtracting capital expenditures from operating cashflow. Specifically, the formula commonly used for FCF is as follows: Earnings before interest and taxes (1-tax rate) + (depreciation) + (amortization) – (change in networking capital) – (capital expenditure) […]
Posted in Finance Glossary
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