Stock Market Math (eBook)

Essential formulas for selecting and managing stock and risk

Michael C. Thomsett (Autor)

eBook Download: EPUB

2017
283 Seiten
De Gruyter (Verlag)
978-1-5015-0736-6 (ISBN)

Infos

Stock Market Math shows you how to calculate return, leverage, risk, fundamental and technical analysis problems, price, volume, momentum and moving averages, including over 125 formulas and Excel programs for each, enabling readers to simply plug formulas into a spread sheet.

This book is the definitive reference for all investors and traders. It introduces the many formulas and legends every investor needs, and explains their application through examples and narrative discussions providing the Excel spreadsheet programs for each. Readers can find instant answers to every calculation required to pick the best trades for your portfolio, quantify risk, evaluate leverage, and utilize the best technical indicators.

Michael C. Thomsett is a market expert, author, speaker and coach. His many books include Mathematics of Options, Real Estate Investor's Pocket Calculator, and A Technical Approach to Trend Analysis. In Stock Market Math, the author advances the science of risk management and stock evaluation with more than 50 endnotes, 50 figures and tables, and a practical but thoughtful exploration of how investors and traders may best quantify their portfolio decisions.

Michael C. Thomsett

Autor

Michael C. Thomsett, Business and investment writer

Inhalt

Chapter 1: Rates of Return on Investment: What Goes In, What Comes Out  1 Judging the Outcome – What Did You Expect?  2 The Basic Equation: Return on Cash Invested  4 Calculating Option Trading Returns  10 Taxes and Investment Return  13 Conclusion  17 Chapter 2: Returns on Capital: Putting Cash to Work  19 Calculating Returns from the Corporate View  19 Calculating Average Net Worth  22 Net Worth Versus Total Capitalization  24 Preferred Stock as Hybrid Capitalization  27 The Importance of “Use of Capital”  31 Conclusion  33 Chapter 3: Leverage and Risk Analysis: Maximizing Other People’s Money  35 Calculating the Cost of Money  35 Annualized Return  38 Leverage-Based Risk—the P/E Ratio as a Way to Quantify  40 Using Options as a Form of Leverage  44 Conclusion  48 Chapter 4: Long-Term Trends: Patience Rewarded  49 A Realistic View: Long-Term Returns and Annual Rates  50 Total Net Annualized Return  53 Carryover Losses and Net Return  56 Realistic Expectations: Inflation and Taxes  58 Compound Return Calculations  60 Other Cash Flow Trends  63 Return Formulas  65 Useful Return Shortcuts  70 Estimating the Value of Deposits over Time  72 Conclusion  76 Chapter 5: Core Earnings and Net Worth Adjustments: Making the Numbers Real  77 The Problem with Today’s Accounting Rules  78 Flaws in the GAAP System – a Passive Approach to Reporting  80 Examples of Material Expenses  82 Balance Sheet Problems – Inaccurate Valuation  84 Recalculating the Key Ratios  85 Recalculating Net Worth  89 Finding Core Earnings – Comparative Analysis  92 Conclusion  93 Chapter 6: Fundamentals: Balance Sheet Tests You Need to Know  95 The Nature of Fundamental Analysis  96 Basics of the Balance Sheet  98 Working Capital Tests  101 Accounts Receivable Tests  105 Inventory Tests  108 Long-Term Asset Tests  110 Capitalization  112 Tangible and Total Book Value  116 Chapter 7: Fundamentals: Operating Statement Tests You Need to Know  121 The Basics of the Operating Statement  123 Revenue Trends  128 Earnings Trends  129 Revenue Compared to Direct Costs and Expenses  131 Conclusion  138 Chapter 8: Market Trend Calculations  139 Index Weighting  139 Breadth of the Market  143 Short Interest Ratio  146 New Highs and New Lows  148 Put/Call Ratio  151 Mutual Fund Ratios  152 Chapter 9: Price Indicators  159 The Basics of Technical Analysis  159 The Random Walk Hypothesis and the Efficient Market Theory  162 Basic Price Calculations  165 Chart Patterns and Interpretations  167 Technical Tests of Market Sentiment  171 Breadth of Trading  171 Chapter 10: Volume Indicators  175 Change in Volume  176 On Balance Volume (OBV)  178 Accumulation/Distribution (A/D)  180 Money Flow Index (MFI)  183 Large Block Ratio  186 Conclusion  187 Chapter 11: Momentum Oscillators and Moving Averages  189 Overview, Momentum Oscillators  189 Relative Strength Index (RSI)  192 Moving Average Convergence Divergence (MACD)  195 Stochastic Oscillator  197 Moving Averages  199 Bollinger Bands (BB)  201 Conclusion  204 Chapter 12: Combined Testing: Merging Price and Financial Tests  205 Effective Use of Combined Analysis  206 Valid Versus Invalid Forms of Testing  208 Identifying Important Combined Tests  209 Additional Price-Based Combined Tests  211 The Oddities of Hybrid Analysis  215 Appendix A Stock Market Formulas: Summarizing the Essentials  219 Appendix B: Excel Program Entries: Automating the Formulas  247 Index  267

Rezensionen

I am thankful Michael Thomsett was able to bring clarity and context to investment performance measurement. It's a foreign language to so many but vital to our ability to save and retire. A great read for anyone interested in the markets. --Jakob Rohn, Co-founder, WorkN and Board Member, Delta Data Michael Thomsett has done it again--simple, practical and actionable advice for anyone seeking to understand how the stock market works while limiting downside risk. An essential encyclopedia of market knowledge presented with simplicity. A "must read" reference for anyone interested in the stock market. --Gary Lynch, CEO & Founder, The Risk Project, LLC Score another winner for Michael Thomsett! In Stock Market Math the education guru is back, big time--providing us with the blueprints for success. With a writing style that is at once comprehensive, yet easy to understand, Thomsett's trademark ability to "make the complex simple" is on full display. Filled with wisdom, Thomsett's book tackles concepts that will appeal to investors at every level. Beginners will enjoy his breakdown of investment building blocks, while seasoned pros will appreciate his deeper dive into the material. Yet all will take something away from Thomsett's book--and that something is the ability to take higher and more consistent profits out of the stock market.　 --Michael Stoppa, Author, The Options Alchemist

Produkt-Details

• Erscheint lt. Verlag: 20.11.2017
• Zusatzinfo: 20 b/w ill., 30 b/w tbl.
• Verlagsort: Boston
• Sprache: englisch
• Themenwelt: Sachbuch/Ratgeber ► Beruf / Finanzen / Recht / Wirtschaft ► Geld / Bank / Börse
• Themenwelt: Mathematik / Informatik ► Mathematik ► Angewandte Mathematik
• Themenwelt: Mathematik / Informatik ► Mathematik ► Finanz- / Wirtschaftsmathematik
• Themenwelt: Recht / Steuern ► Wirtschaftsrecht
• Themenwelt: Wirtschaft ► Betriebswirtschaft / Management ► Finanzierung
• Schlagworte: Chaikin • Compounding • Depreciation • Net Worth • Present Value • Price/earnings • Rate of growth • Rate of return • ratios • ROI • stochastic
• ISBN-10: 1-5015-0736-2 / 1501507362
• ISBN-13: 978-1-5015-0736-6 / 9781501507366