What You Need to Know About Capital Intensive Activities What is best way to learn technical analysis? There is no definitive answer to this question as different traders have different preferences and opinions on what is the best way to learn technical analysis. However, here are some general tips that may be useful: 1. Read … Read more
Characteristic line definition is a phrase used in technical analysis that refers to a line drawn on a price chart that connects a series of past price points. This line is used to help identify trends and predict future prices. How do you add a characteristic line in Excel? To add a characteristic line in … Read more
The K-Ratio is a tool used by fundamental analysts to measure a company’s financial health. It is calculated by dividing a company’s market capitalization by its book value. The resulting number is then compared to similar companies in the same industry to gauge the company’s financial health. A high K-Ratio indicates that the company is … Read more
Net present value of growth opportunities (NPVGO) is a valuation metric used to estimate the intrinsic value of a company. NPVGO is calculated by taking the present value of all future cash flows from growth opportunities and subtracting the present value of all future costs associated with those opportunities. The idea behind NPVGO is that … Read more
The Bonferroni test is a statistical test used to control for Type I error, or false positives, in multiple hypothesis testing. The Bonferroni test adjusts the p-value for each individual hypothesis test by dividing it by the number of tests being performed. This effectively lowers the threshold for significance, and therefore increases the likelihood of … Read more
Okun’s law is an economic rule of thumb that states that for every 1% increase in a nation’s unemployment rate, its GDP will decline by approximately 2.5%. The law is named after Arthur Okun, who first proposed it in 1962. Okun’s law is often cited as a key reason why reducing unemployment is important for … Read more
A representative sample is important because it provides information that can be generalized to the entire population. Examples of representative samples include random samples and stratified samples.. What is a Representative Sample? A representative sample is a subset of a population that accurately reflects the characteristics of the entire population. A well-chosen representative sample allows … Read more
Functional decomposition is the process of breaking down a complex system into its component parts, or functions. This analysis is typically used to understand how a system works, or to identify potential areas for improvement. Functional decomposition can be used to understand both simple and complex systems. For example, a car can be broken down … Read more
A confidence interval is a range of values that is likely to contain a population parameter, such as a mean or proportion. The interval is based on a sample statistic, such as a sample mean, and is constructed so that there is a certain probability, called the confidence level, that the population parameter will fall … Read more
Mosaic theory is a tool used by fundamental analysts to help them better understand a company and its share price. By looking at a company’s financials, analysts can build a “mosaic” of the company, which can help them identify trends and predict future performance. Mosaic theory is based on the idea that a company is … Read more
