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Capitalization ratios |
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Capitalization ratiosAlso called financial leverage ratios, these ratios compare debt to total capitalization and thus reflect the extent to which a corporation is trading on its equity. Capitalization ratios can be interpreted only in the context of the stability of industry and company earnings and cash flow.Capitalization ratios Similar MatchesCapitalization methodCapitalization methodA method of constructing a replicating portfolio in which the manager purchases a number of the most highly capitalized names in the stock index in proportion to their capitalization. Small capitalization (small cap) fundSmall capitalization (small cap) fundA mutual fund that invests primarily in mutual fund of companies whose market value is less than $1 billion. Small-cap stocks historically have been more volatile than large-cap stocks, and often perform differently from the overall market. Leveraged recapitalizationLeveraged recapitalizationOften used in risk arbitrage. A public company takes on significant additional debt with the purpose of either paying an extraordinary dividend or repurchasing shares, leaving the public shareholders with a continuing interest in a more financially leveraged company. Popular form of shark repellent See: Stub. OvercapitalizationOvercapitalizationSaid to occur when a firm cannot service its debt even though its deb../../finance-glossary/equity ratio is not excessive. Capitalization tableCapitalization tableA table showing the capitalization of a firm, which typically includes the amount of capital obtained from each source - long-term debt and common equity - and the respective capitalization ratios. Further SuggestionsSmall capitalization (small cap) stocksNasdaq small capitalization companies Capitalization rate Recapitalization proposal Capitalization Weighted Index Total capitalization |
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