Market Ratios are useful in measuring investor response to owning a company's shares and also the cost of issuing shares to the public. Almost all of these ratios can be used to take decisions as to whether we should invest in a company's stock or not. The ratios that fall under this category are:
1. Earnings Per Share (EPS)
2. Payout Ratio
3. Dividend Cover
4. P/E Ratio
5. Dividend Yield
6. Cash Flow Ratio
7. Price to Book Value Ratio (P/B or PBV)
8. Price to Sales Ratio
9. PEG Ratio
Market debt ratio= TL / (TL - Equity) Note : equity with market value .
Price earnings ratio.
The ratio of bids to asks in the current market conditions is 2:1.
The market debt to equity ratio is calculated by dividing a company's total market debt by its total market equity. First, determine the total market debt, which includes all interest-bearing liabilities such as loans and bonds. Next, calculate the total market equity by multiplying the current stock price by the total number of outstanding shares. Finally, divide the total market debt by the total market equity to obtain the ratio.
The Q ratio is calculated as the market value of a company divided by the replacement value of the firm's assets Tobin's Q ratio
Market debt ratio= TL / (TL - Equity) Note : equity with market value .
Price earnings ratio.
The market concentration ratio for perfect competition is Low (Less than 40%).
The ratio of bids to asks in the current market conditions is 2:1.
what is market to book ratios used for?
The quantity of product(farm product) that is keep by the farmer and they do not sell this in the market is called market surplus ratio.
The noise reduction ratio of the latest model of headphones on the market is 25 decibels.
The bonds are traded in the market because of the P/E ratio of a company.
The price ratio in economics is important because it reflects the relative value of goods or services. It impacts market dynamics by influencing consumer behavior, production decisions, and overall market equilibrium. When the price ratio changes, it can lead to shifts in supply and demand, affecting prices and quantities exchanged in the market.
The Q ratio is calculated as the market value of a company divided by the replacement value of the firm's assets Tobin's Q ratio
The Price to Sales Ratio (PSR) is a valuation ratio for stocks that is similar to the EPS ratio we saw earlier in this article. It is used to identify how much of revenue is generated compared to the company's market price.Formula:PSR = Market Capitalization / Total RevenueOrPSR = Current Market Price per Share / Revenue per ShareRevenue per Share = Total Revenue / Total No. of Outstanding Shares
The ratio of the current net market value of open positions held between two counterparties to the current gross market value of positions between the same counterparties.