In finance Finance is the science of funds management. The general areas of finance are business finance, personal finance, and public finance. Finance includes saving money and often includes lending money. The field of finance deals with the concepts of time, money, and risk and how they are interrelated. It also deals with how money is spent and budgeted, rate of return (ROR), also known as return on investment (ROI), rate of profit or sometimes just return, is the ratio of money Money is any object that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally, a standard of deferred payment gained or lost (whether realized or unrealized) on an investment Investment is the commitment of money or capital to purchase financial instruments or other assets in order to gain profitable returns in form of interest, income, or appreciation of the value of the instrument. It is related to saving or deferring consumption. Investment is involved in many areas of the economy, such as business management and relative to the amount of money invested. The amount of money gained or lost may be referred to as interest Interest is a fee paid on borrowed assets. It is the price paid for the use of borrowed money, or, money earned by deposited funds. Assets that are sometimes lent with interest include money, shares, consumer goods through hire purchase, major assets such as aircraft, and even entire factories in finance lease arrangements. The interest is, profit In accounting, profit is the difference between price and the costs of bringing to market whatever it is that is accounted as an enterprise in terms of the component costs of delivered goods and/or services and any operating or other expenses/loss, gain/loss, or net income/loss. The money invested may be referred to as the asset In financial accounting, assets are economic resources. Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset. Simplistically stated, assets represent ownership of value that can be converted into cash . The balance sheet of a firm, capital In economics, capital, capital goods, or real capital are factors of production used to create goods or services that are not themselves significantly consumed in the production process. Capital goods may be acquired with money or financial capital, principal Debt is that which is owed; usually referencing assets owed, but the term can also cover moral obligations and other interactions not requiring money. In the case of assets, debt is a means of using future purchasing power in the present before a summation has been earned. Some companies and corporations use debt as a part of their overall, or the cost basis Basis , as used in United States tax law, is the original cost of property, adjusted for factors such as depreciation. When property is sold, the taxpayer pays/(saves) taxes on a capital gain/(loss) that equals the amount realized on the sale minus the sold property's basis of the investment. ROI is usually expressed as a percentage rather than a fraction.

Contents

Calculation

The initial value of an investment, Vi, does not always have a clearly defined monetary value The economic value of a good or service has puzzled economists since the beginning of the discipline. First, economists tried to estimate the value of a good to an individual alone, and extend that definition to goods which can be exchanged. From this analysis came the concepts value in use and value in exchange, but for purposes of measuring ROI, the expected value must be clearly stated along with the rationale for this initial value. The multiple value of an investment, Vf, also does not always have a clearly defined monetary value, but for purposes of measuring ROI, the final value must be clearly stated along with the rationale for this final value.[citation needed]

The rate of return can be calculated over a single period, or expressed as an average over multiple periods.

Single-period

Arithmetic return

The arithmetic return is:

rarith is sometimes referred to as the yield In finance, the term yield describes the amount in cash that returns to the owners of a security. Normally it does not include the price variations, at the difference of the total return. Yield applies to various stated rates of return on stocks , fixed income instruments (bonds, notes, bills, strips, zero coupon), and some other investment type. See also: effective interest rate The effective interest rate, effective annual interest rate, annual equivalent rate or simply effective rate is the interest rate on a loan or financial product restated from the nominal interest rate as an interest rate with annual compound interest payable in arrears. It is used to compare the annual interest between loans with different, effective annual rate The effective interest rate, effective annual interest rate, annual equivalent rate or simply effective rate is the interest rate on a loan or financial product restated from the nominal interest rate as an interest rate with annual compound interest payable in arrears. It is used to compare the annual interest between loans with different (EAR) or annual percentage yield Annual percentage yield is a normalized representation of an interest rate, based on a compounding period of one year. APY figures allow for a reasonable, single-point comparison of different offerings with varying compounding schedules. However, it does not account for the possibility of account fees affecting the net gain. APY generally refers (APY).

Logarithmic or continuously compounded return

The logarithmic return or continuously compounded return Compound interest arises when interest is added to the principal, so that from that moment on, the interest that has been added also itself earns interest. This addition of interest to the principal is called compounding . A loan, for example, may have its interest compounded every month: in this case, a loan with $100 initial principal and 1%, also known as force of interest Compound interest arises when interest is added to the principal, so that from that moment on, the interest that has been added also itself earns interest. This addition of interest to the principal is called compounding . A loan, for example, may have its interest compounded every month: in this case, a loan with $100 initial principal and 1%, is cleared as:

It is the reciprocal of the e-folding In science, e-folding is the time interval in which an exponentially growing quantity increases by a factor of e. This term is often used in theoretical physics, especially when cosmic inflation is investigated. Physicists often talk about the e-folding time scale that is determined by the proper time in which the length of a patch of space or time.

Multiperiod average returns

Arithmetic average rate of return

The arithmetic average rate of return over n periods is defined as:

Geometric average rate of return

The geometric average rate of return, also known as the time-weighted rate of return, over n periods is defined as:

The geometric average rate of return calculated over n years is also known as the annualized return.

Internal rate of return

Main article: Internal rate of return The internal rate of return is a rate of return used in capital budgeting to measure and compare the profitability of investments. It is also called the discounted cash flow rate of return (DCFROR) or simply the rate of return (ROR). In the context of savings and loans the IRR is also called the effective interest rate. The term internal refers to

The internal rate of return (IRR), also known as the dollar-weighted rate of return, is defined as the value(s) of that satisfies the following equation:

where:

When the rate of return r is smaller than the IRR rate , the investment is profitable, i.e., NPV > 0. Otherwise, the investment is not profitable.

Comparisons between various rates of return

Arithmetic and logarithmic return

The value of an investment is doubled over a year if the annual ROR or . The value falls to zero when or .

Arithmetic and logarithmic returns are not equal, but are approximately equal for small returns. The difference between them is large only when percent changes are high. For example, an arithmetic return of +50% is equivalent to a logarithmic return of 40.55%, while an arithmetic return of -50% is equivalent to a logarithmic return of -69.31%.

Logarithmic returns are often used by academics in their research. The main advantage is that the continuously compounded return is symmetric, while the arithmetic return is not: positive and negative percent arithmetic returns are not equal. This means that an investment of $100 that yields an arithmetic return of 50% followed by an arithmetic return of -50% will result in $75, while an investment of $100 that yields a logarithmic return of 50% followed by an logarithmic return of -50% it will remain $100.

Comparison of arithmetic and logarithmic returns for initial investment of $100
Initial investment, Vi $100 $100 $100 $100 $100
Final investment, Vf $0 $50 $100 $150 $200
Profit/loss, VfVi -$100 -$50 $0 $50 $100
Arithmetic return, rarith -100% -50% 0% 50% 100%
Logarithmic return, rlog -69.31% 0% 40.55% 69.31%

Arithmetic average and geometric average rates of return

Both arithmetic and geometric average rates of returns are averages of periodic percentage returns. Neither will accurately translate to the actual dollar amounts gained or lost if percent gains are averaged with percent losses. [1] A 10% loss on a $100 investment is a $10 loss, and a 10% gain on a $100 investment is a $10 gain. When percentage returns on investments are calculated, they are calculated for a period of time – not based on original investment dollars, but based on the dollars in the investment at the beginning and end of the period. So if an investment of $100 loses 10% in the first period, the investment amount is then $90. If the investment then gains 10% in the next period, the investment amount is $99.

A 10% gain followed by a 10% loss is a 1% loss. The order in which the loss and gain occurs does not affect the result. A 50% gain and a 50% loss is a 25% loss. An 80% gain plus an 80% loss is a 64% loss. To recover from a 50% loss, a 100% gain is required. The mathematics of this are beyond the scope of this article, but since investment returns are often published as "average returns", it is important to note that average returns do not always translate into dollar returns.

Example #1 Level Rates of Return
Year 1 Year 2 Year 3 Year 4
Rate of Return 5% 5% 5% 5%
Geometric Average at End of Year 5% 5% 5% 5%
Capital at End of Year $105.00 $110.25 $115.76 $121.55
Dollar Profit/(Loss) $5.00 $10.25 $15.76 $21.55
Compound Yield 5% 5.4%
Example #2 Volatile Rates of Return, including losses
Year 1 Year 2 Year 3 Year 4
Rate of Return 50% -20% 30% -40%
Geometric Average at End of Year 50% 9.5% 16% -1.6%
Capital at End of Year $150.00 $120.00 $156.00 $93.60
Dollar Profit/(Loss) ($6.40)
Compound Yield -1.6%
Example #3 Highly Volatile Rates of Return, including losses
Year 1 Year 2 Year 3 Year 4
Rate of Return -95% 0% 0% 115%
Geometric Average at End of Year -95% -77.6% -63.2% -42.7%
Capital at End of Year $5.00 $5.00 $5.00 $10.75
Dollar Profit/(Loss) ($89.25)
Compound Yield -22.3%

Annual returns and annualized returns

Care must be taken not to confuse annual and annualized returns. An annual rate of return is a single-period return, while an annualized rate of return is a multi-period, geometric average return.

An annual rate of return is the return on an investment over a one-year period, such as January 1 through December 31, or June 3 2006 through June 2 2007. Each ROI in the cash flow example above is an annual rate of return.

An annualized rate of return is the return on an investment over a period other than one year (such as a month, or two years) multiplied or divided to give a comparable one-year return. For instance, a one-month ROI of 1% could be stated as an annualized rate of return of 12%. Or a two-year ROI of 10% could be stated as an annualized rate of return of 5%. **For GIPS compliance: you do not annualize portfolios or composites for periods of less than one year. You start on the 13th month.

In the cash flow example below, the dollar returns for the four years add up to $265. The annualized rate of return for the four years is: $265 ÷ ($1,000 x 4 years) = 6.625%.

Uses

Cash Flow Example on $1,000 Investment
Year 1 Year 2 Year 3 Year 4
Dollar Return $100 $55 $60 $50
ROI 10% 5.5% 6% 5%
0.05 x 0.15 = 0.0075
0.05 - 0.0075 = 0.0425 = 4.25%
0.10 x 0.25 = 0.025
0.10 - 0.025 = 0.075 = 7.5%

Investors usually seek a higher rate of return on taxable investment returns than on non-taxable investment returns.

Cash or potential cash returns

Time value of money

Investments generate cash flow to the investor to compensate the investor for the time value of money For example, 100 dollars of today's money invested for one year and earning 5 percent interest will be worth 105 dollars after one year. Therefore, 100 dollars paid now or 105 dollars paid exactly one year from now both have the same value to the recipient who assumes 5 percent interest; using time value of money terminology, 100 dollars invested.

Except for rare periods of significant deflation where the opposite may be true, a dollar in cash is worth less today than it was yesterday, and worth more today than it will be worth tomorrow. The main factors that are used by investors to determine the rate of return at which they are willing to invest money include:

The time value of money is reflected in the interest rates An interest rate is the rate at which interest is paid by a borrower for the use of money that they borrow from a lender. For example, a small company borrows capital from a bank to buy new assets for their business, and in return the lender receives interest at a predetermined interest rate for deferring the use of funds and instead lending it to that banks Banking is generally a highly regulated industry, and government restrictions on financial activities by banks have varied over time and location. The current set of global bank capital standards are called Basel II. In some countries such as Germany, banks have historically owned major stakes in industrial corporations while in other countries offer for deposits A deposit account is a current account, savings account, or other type of bank account, at a banking institution that allows money to be deposited and withdrawn by the account holder. These transactions are recorded on the bank's books, and the resulting balance is recorded as a liability for the bank, and represent the amount owed by the bank to, and also in the interest rates that banks charge for loans such as home mortgages. The “risk-free The risk-free interest rate is the interest rate that it is assumed can be obtained by investing in financial instruments with no default risk. However, the financial instrument can carry other types of risk, e.g. market risk , liquidity risk (the risk of being unable to sell the instrument for cash at short notice without significant costs), etc” rate is the rate on U.S. Treasury Bills A United States Treasury security is a government debt issued by the United States Department of the Treasury through the Bureau of the Public Debt. Treasury securities are the debt financing instruments of the United States Federal government, and they are often referred to simply as Treasuries. There are four types of marketable treasury, because this is the highest rate available without risking capital.

The rate of return which an investor expects from an investment is called the Discount Rate The discount rate is an interest rate a central bank charges depository institutions that borrow reserves from it. Each investment has a different discount rate, based on the cash flow expected in future from the investment. The higher the risk Risk concerns the deviation of one or more results of one or more future events from their expected value. Technically, the value of those results may be positive or negative. However, general usage tends to focus only on potential harm that may arise from a future event, which may accrue either from incurring a cost or by failing to attain some, the higher the discount rate (rate of return) the investor will demand from the investment.

Compounding or reinvesting

Compound interest Compound interest arises when interest is added to the principal, so that from that moment on, the interest that has been added also itself earns interest. This addition of interest to the principal is called compounding . A loan, for example, may have its interest compounded every month: in this case, a loan with $100 initial principal and 1% or other reinvestment of cash returns (such as interest and dividends) does not affect the discount rate of an investment, but it does affect the Annual Percentage Yield Annual percentage yield is a normalized representation of an interest rate, based on a compounding period of one year. APY figures allow for a reasonable, single-point comparison of different offerings with varying compounding schedules. However, it does not account for the possibility of account fees affecting the net gain. APY generally refers, because compounding/reinvestment increases the capital invested.

For example, if an investor put $1,000 in a 1-year Certificate of Deposit (CD) that paid an annual interest rate of 4%, compounded quarterly, the CD would earn 1% interest per quarter on the account balance. The account balance includes interest previously credited to the account.

Compound Interest Example
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Capital at the beginning of the period $1,000 $1,010 $1,020.10 $1,030.30
Dollar return for the period $10 $10.10 $10.20 $10.30
Account Balance at end of the period $1,010.00 $1,020.10 $1,030.30 $1,040.60
Quarterly ROI 1% 1% 1% 1%

The concept of 'income stream' may express this more clearly. At the beginning of the year, the investor took $1,000 out of his pocket (or checking account) to invest in a CD at the bank. The money was still his, but it was no longer available for buying groceries. The investment provided a cash flow of $10.00, $10.10, $10.20 and $10.30. At the end of the year, the investor got $1,040.60 back from the bank. $1,000 was return of capital.

Once interest is earned by an investor it becomes capital Financial capital can refer to money used by entrepreneurs and businesses to buy what they need to make their products or provide their services or to that sector of the economy based on its operation, i.e. retail, corporate, investment banking, etc. Compound interest involves reinvestment of capital; the interest earned during each quarter is reinvested. At the end of the first quarter the investor had capital of $1,010.00, which then earned $10.10 during the second quarter. The extra dime was interest on his additional $10 investment. The Annual Percentage Yield Annual percentage yield is a normalized representation of an interest rate, based on a compounding period of one year. APY figures allow for a reasonable, single-point comparison of different offerings with varying compounding schedules. However, it does not account for the possibility of account fees affecting the net gain. APY generally refers or Future value Future value measures the nominal future sum of money that a given sum of money is "worth" at a specified time in the future assuming a certain interest rate, or more generally, rate of return; it is the present value multiplied by the accumulation function[citation needed] for compound interest is higher than for simple interest because the interest is reinvested as capital and earns interest. The yield on the above investment was 4.06%.

Bank accounts offer contractually guaranteed returns, so investors cannot lose their capital. Investors/Depositors lend money to the bank, and the bank is obligated to give investors back their capital plus all earned interest. Because investors are not risking losing their capital on a bad investment, they earn a quite low rate of return. But their capital steadily increases.

Returns when capital is at risk

Capital gains and losses

Many investments carry significant risk that the investor will lose some or all of the invested capital. For example, investments in company stock shares put capital at risk. The value of a stock share depends on what someone is willing to pay for it at a certain point in time. Unlike capital invested in a savings account, the capital value (price) of a stock share constantly changes. If the price is relatively stable, the stock is said to have “low volatility.” If the price often changes a great deal, the stock has “high volatility.” All stock shares have some volatility, and the change in price directly affects ROI for stock investments.

Stock returns are usually calculated for holding periods such as a month, a quarter or a year.

Reinvestment when capital is at risk: rate of return and yield

Example: Stock with low volatility and a regular quarterly dividend, reinvested
End of: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Dividend $1 $1.01 $1.02 $1.03
Stock Price $98 $101 $102 $99
Shares Purchased 0.010204 0.01 0.01 0.010404
Total Shares Held 1.010204 1.020204 1.030204 1.040608
Investment Value $99 $103.04 $105.08 $103.02
Quarterly ROI -1% 4.08% 1.98% -1.96%

Yield is the compound rate of return that includes the effect of reinvesting interest or dividends.

To the right is an example of a stock investment of one share purchased at the beginning of the year for $100.

To calculate the rate of return, the investor includes the reinvested dividends in the total investment. The investor received a total of $4.06 in dividends over the year, all of which were reinvested, so the investment amount increased by $4.06.

The disadvantage of this ROI calculation is that it does not take into account the fact that not all the money was invested during the entire year (the dividend reinvestments occurred throughout the year). The advantages are: (1) it uses the cost basis of the investment, (2) it clearly shows which gains are due to dividends and which gains/losses are due to capital gains/losses, and (3) the actual dollar return of $3.02 is compared to the actual dollar investment of $104.06.

For U.S. income tax purposes, if the shares were sold at the end of the year, dividends would be $4.06, cost basis of the investment would be $104.06, sale price would be $103.02, and the capital loss would be $1.04.

Since all returns were reinvested, the ROI might also be calculated as a continuously compounded return or logarithmic return. The effective continuously compounded rate of return is the natural log of the final investment value divided by the initial investment value:

.

Mutual fund and investment company returns

Mutual funds A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors and invests typically in investment securities . The mutual fund will have a fund manager that trades (buys and sells) the fund's investments in accordance with the fund's investment objective. In the U.S., a fund registered with the, exchange-traded funds (ETFs), and other equitized investments (such as unit investment trusts or UITs, insurance separate accounts and related variable products such as variable universal life insurance policies and variable annuity contracts, and bank-sponsored commingled funds, collective benefit funds or common trust funds) are essentially portfolios of various investment securities such as stocks, bonds and money market instruments which are equitized by selling shares or units to investors. Investors and other parties are interested to know how the investment has performed over various periods of time.

Performance is usually quantified by a fund's total return. In the 1990s, many different fund companies were advertising various total returns-- some cumulative, some averaged, some with or without deduction of sales loads or commissions, etc. To level the playing field and help investors compare performance returns of one fund to another, the U.S. Securities and Exchange Commission (SEC) began requiring funds to compute and report total returns based upon a standardized formula-- so called "SEC Standardized total return" which is the average annual total return assuming reinvestment of dividends and distributions and deduction of sales loads or charges. Funds may compute and advertise returns on other bases (so-called "non-standardized" returns), so long as they also publish no less prominently the "standardized" return data.

Subsequent to this, apparently investors who'd sold their fund shares after a large increase in the share price in the late 1990s and early 2000s were ignorant of how significant the impact of income/capital gain taxes was on their fund "gross" returns. That is, they had little idea how significant the difference could be between "gross" returns (returns before federal taxes) and "net" returns (after-tax returns). In reaction to this apparent investor ignorance, and perhaps for other reasons, the SEC made further rule-making to require mutual funds to publish in their annual prospectus, among other things, total returns before and after the impact of U.S federal individual income taxes. And further, the after-tax returns would include 1) returns on a hypothetical taxable account after deducting taxes on dividends and capital gain distributions received during the illustrated periods and 2) the impacts of the items in #1) as well as assuming the entire investment shares were sold at the end of the period (realizing capital gain/loss on liquidation of the shares). These after-tax returns would apply of course only to taxable accounts and not to tax-deferred or retirement accounts such as IRAs.

Lastly, in more recent years, "personalized" investment returns have been demanded by investors. In other words, investors are saying more or less the fund returns may not be what their actual account returns are based upon the actual investment account transaction history. This is because investments may have been made on various dates and additional purchases and withdrawals may have occurred which vary in amount and date and thus are unique to the particular account. More and more fund and brokerage firms have begun providing personalized account returns on investor's account statements in response to this need.

With that out of the way, here's how basic earnings and gains/losses work on a mutual fund. The fund records income for dividends and interest earned which typically increases the value of the mutual fund shares, while expenses set aside have an offsetting impact to share value. When the fund's investments increase in market value, so too does the value of the fund shares (or units) owned by the investors. When investments increase (decrease) in market value, so too the fund shares value increases (or decreases). When the fund sells investments at a profit, it turns or reclassifies that paper profit or unrealized gain into an actual or realized gain. The sale has no affect on the value of fund shares but it has reclassified a component of its value from one bucket to another on the fund books-- which will have future impact to investors. At least annually, a fund usually pays dividends from its net income (income less expenses) and net capital gains realized out to shareholders as an IRS requirement. This way, the fund pays no taxes but rather all the investors in taxable accounts do. Mutual fund share prices are typically valued each day the stock or bond markets are open and typically the value of a share is the net asset value of the fund shares investors own.

Total returns

This section addresses only total returns without the impact of U.S. federal individual income and capital gains taxes.

Mutual funds report total returns assuming reinvestment of dividend and capital gain distributions. That is, the dollar amounts distributed are used to purchase additional shares of the funds as of the reinvestment/ex-dividend date. Reinvestment rates or factors are based on total distributions (dividends plus capital gains) during each period.

Total Return = ((Final Price x Last Reinvestment Factor) - Beginning Price) / Beginning Price

Average annual total return (geometric)

Average Annual Return (geometric) US mutual funds are to compute total return as proscribed by the U.S. Securities and Exchange Commission (SEC) in instructions to form N-1A (the fund prospectus) as the average annual compounded rates of return for 1-year, 5-year and 10-year periods (or inception of the fund if shorter) as the "average annual total return" for each fund. The following formula is used:[4]

P(1+T)n = ERV

Where:

P = a hypothetical initial investment of $1,000.

T = average annual total return.

n = number of years.

ERV = ending redeemable value of a hypothetical $1,000 payment made at the beginning of the 1-, 5-, or 10-year periods at the end of the 1-, 5-, or 10-year periods (or fractional portion).

Example

Example: Mutual Fund with low volatility and a regular annual dividend, reinvested at year-end share price, initial share value $100
End of: Year 1 Year 2 Year 3 Year 4 Year 5
Dividend $5 $5 $5 $5 $5
Capital Gain Distribution $2
Total Distribution $5 $5 $7 $5 $5
Share Price $98 $101 $102 $99 $101
Shares Purchased 0.05102 0.04950 0.06863 0.05051 0.04950
Shares Owned 1.05102 1.10053 1.16915 1.21966 1.26916
Reinvestment Factor 1.05102 1.05203 1.07220 1.05415 1.05219

Using a Holding Period Return calculation, after 5 years, an investor who reinvested owned 1.26916 share valued at $101 per share ($128.19 in value). ($128.19-$100)/$100/5 = 5.638% return. An investor who did not reinvest received total cash payments of $27 in dividends and $1 in capital gain. ($27+$1)/$100/5 = 5.600% return.

Mutual funds include capital gains as well as dividends in their return calculations. Since the market price of a mutual fund share is based on net asset value, a capital gain distribution is offset by an equal decrease in mutual fund share value/price. From the shareholder's perspective, a capital gain distribution is not a net gain in assets, but it is a realized capital gain.

Summary: overall rate of return

Rate of Return and Return on Investment indicate cash flow from an investment to the investor over a specified period of time, usually a year.

ROI is a measure of investment profitability, not a measure of investment size. While compound interest and dividend reinvestment can increase the size of the investment (thus potentially yielding a higher dollar return to the investor), Return on Investment is a percentage return based on capital invested.

In general, the higher the investment risk, the greater the potential investment return, and the greater the potential investment loss.

See also

References

  1. ^ Damato,Karen. Doing the Math: Tech Investors' Road to Recovery is Long. Wall Street Journal, pp.C1-C19, May 18, 2001
  2. ^ A. A. Groppelli and Ehsan Nikbakht (2000). Barron's Finance, 4th Edition. New York. pp. 442–456. ISBN 0-7641-1275-9.
  3. ^ Barron's Finance. pp. 151–163.
  4. ^ U.S. Securities and Exchange Commission (1998). [http://www.sec.gov/rules/final/33-7512f.htm#E12E2 "Final Rule: Registration Form Used by Open-End Management Investment Companies: Sample Form and instructions"]. http://www.sec.gov/rules/final/33-7512f.htm#E12E2.

Further reading

External links

Stock market
Types of stocks Stock · Common stock · Preferred stock · Outstanding stock · Treasury stock · Authorised stock · Restricted stock · Concentrated stock · Golden share
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Exchanges Stock exchange · List of stock exchanges · Over-the-counter · Electronic Communication Network
Stock valuation Gordon model · Dividend yield · Earnings per share · Book value · Earnings yield · Beta · Alpha · CAPM · Arbitrage pricing theory · T-Model
Financial ratios P/CF ratio · P/E · PEG · P/S ratio · P/B ratio · D/E ratio · Dividend payout ratio · Dividend cover · SGR · ROIC · ROCE · ROE · ROA · EV/EBITDA · RSI · RAROC · Sharpe ratio · Treynor ratio · Cap rate
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I need to know the return vehicle policy if your credit is bad and no one will finance you.?
Q. I've had the new 2009 corolla over a month now and because no one will finance me they want me to bring back the car. Do I get my old car back? What about the transfer back? Gas? What am I to expect when I do bring the car back; don't know anything about it.
Asked by Yvonne - Wed Sep 3 12:57:55 2008 - - 2 Answers - 0 Comments

A. Sounds like you let them talk you into a "drive-off sale" which means it's contingent on financing approval. Read the paperwork you signed - what does it say about financing refusal?
Answered by jlf - Wed Sep 3 15:28:04 2008

Yahoo Answers Search: Return (finance),
Thu Jul 29 11:03:08 2010