|
|
Cash asset ratio |
|
|
|
 Home Site Map Add Term Search About Us Contributors |
Cash asset ratioCash and marketable securities divided by current liabilities. See: Liquidity ratios.Cash asset ratio Similar MatchesPhysical assetPhysical assetActual property such as precious metals or real estate. Also called real or tangible assets. Earning assetEarning assetAny asset which produces income. Net asset valueNet asset valueThe total assets of a company less all its liabilities including loan capital, and preference shares. NAV is usually expressed on a per share basis. For example:assets of a company = £12,000,000, liabilities = £3,000,000number of ordinary shares = 18,000,000NAV per share = (£12,000,000 - £3,000,000) / 18,000,000 = 50pHow relevant is NAV for investors in companies? For people-based businesses it is not particularly relevant. An advertising agency, for instance, would have a very low NAV because it has little invested in plant and equipment, and its profitability is driven by people and ideas. Elsewhere, NAV is interesting to value investors who want to know what underpins a company's share price. If a company has a NAV of 120p and its share price is 100p, there is a 20p cushion.The most common use of NAV is in assessing the share price of investment trusts - collective funds which invest in other companies. It is fairly easy to calculate the NAV of investment trusts because their assets are for the most part quoted companies. Investment trusts trade at a discount or premium to their NAV. Current assetsCurrent assetsValue of cash, accounts receivable, inventories, marketable securities and other assets that could be converted to cash in less than 1 year. Asset playAsset playA company with assets that are not believed to be accurately reflected in its stock price, making it an attractive buy or play. Further SuggestionsInactive assetcurrent assets Net quick assets fixed assets Publicly traded assets Asset for asset swap Net monetary assets Exchange of assets Defined asset fund Asset stripper asset play capital asset pricing model Net exposed assets Tangible asset Assets requirements Liquid asset Foreign asset position Other current assets Assets in place wasting asset Asset backed security Permanent Assets Intangible asset Earning asset asset allocation |
|
|
|