1492 terms

Glossary

Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.

Showing 2 terms

Equity multiplier

Fundamental analysis

Average total assets divided by average net worth — how many rupees of assets each rupee of owners’ money carries.

In plain terms

The second term in return on equity. It magnifies a bad year by exactly the factor it magnifies a good one, which is why two lenders with the same headline return are not the same investment.

Read the full lesson →

DuPont analysis

Fundamental analysis

Decomposing ROE into net margin, asset turnover and equity multiplier.

In plain terms

Tells you whether a high ROE comes from brand power, operational speed, or just debt.

Read the full lesson →