Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems. Gordon Scott has been an active investor and technical analyst or ...

The current ratio is calculated by dividing a company’s current assets by its current liabilities. Ratios of 1 or higher indicate short-term solvency.

The debt-service coverage ratio (DSCR) measures the cash flow available to pay current debt obligations. Many lenders set ...

Debt can be scary. It’s not uncommon to have some form of debt in life, be it student loans, medical bills, personal loans, or credit card debt. Figuring out your debt-to-income ratio can help you see ...

Your tax ratio – also called a tax rate – determines the amount of personal income tax you pay each year. Information you give your employer determines how much comes out each pay period. Information ...

A higher Sortino ratio can indicate a good return relative to the risk taken. The Sortino ratio focuses on downside volatility, while the Sharpe ratio considers both upside and downside volatility in ...

Financial ratios are an indicator of health for any business. They may seem esoteric, but to lenders and investors they tell the true story of a company's financial strength and ability to weather an ...

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The defensive interval ratio (DIR) is a financial metric that can help investors assess a company's ability to meet its short-term operating expenses using its liquid assets. Also known as the basic ...

The overhead ratio measures how much of a company's total revenue is spent on indirect costs. This metric is useful for identifying areas where costs can be reduced to improve profitability. Analyzing ...

The quick ratio compares the value of a company’s most liquid assets to the value of its current liabilities so investors can get a sense of how well it can cover its expenses in the short term.