These statistical tools are used by fund managers to understand the risk-reward profile of a mutual fund. Though these involve complex formulae, you don’t need to calculate all of them. Simply knowing the final figures and what the ratios indicate will help you analyse the fund. 1. STANDARD DEVIATION: It is a measure of a ...
The ratio measures the sales generated for every rupee worth of assets. It shows a firm’s efficiency in using its assets to generate revenue. Calculate ASSET TURNOVER RATIO ASSET TURNOVER RATIO = Revenue / Total Assets
It measures a company’s leverage by comparing its debt with its equity base. The ratio indicates the proportion of the company’s assets that are being financed through debt. How to Calculate DEBT-TO-EQUITY RATIO DEBT-TO-EQUITY RATIO = Total Long term debt / Share holder equity
This ratio compares the price of a stock to the revenue earned per share. The revenue for the past four quarters is used in this calculation. How to calculate PRICE TO SALES RATIO (PS) PS = Stock Price / Revenue per share