Interpretation Of Stock Market Savings And Investment Ratios

Shares Calculation

Shares are the interest of shareholders in a company. Bue ship companies usually pay dividends and sometimes offer bonuses.

Interest of most Shareholders is to earn fat dividends and the same times see their investment growing. We considered it deem fit to highlight some basic shares Ratios for our followers and other interested readers:

1) Earning Per Share (eps): this is a means of identifying a company’s past growth pattern and predictive tool to the future. Eps = (Net Profit) ÷ (Total number of ordinary Share).

2) Dividend per Share: this helps in forming opinions on the company’s dividends policy and what to expect in future. Dividend Per Share= (Dividend Declared) ÷ (Ordinary Shares)

3) Dividend Payout Ratio: this means the amount of the earning that is being paid out as dividends. Dividend Payout= (Dividends÷Earnings) × 100

4) Dividend Cover: number of times Dividend per share is covered is covered by earning per share. Dividend Cover = (Dividend÷Ordinary Share) ÷ (Ordinary Share÷Net Profit)

5) Dividend Yield: this is the ratio of Dividend per share to current market price of the Share. It’s calculated on basis of gross dividend. Dividend Yield = (Dividend Per Share ÷ Current Market Price of the Share) × 100. This ratio can be used to compare performances of two or more companies.

6) Price to Earnings Ratio: this measures market valuation of the company. Price to Earnings Ratio ( P/E) = (Market Price ÷ Earnings).

Investment In Security – Basic Facts

Investment in Securities means buying stocks, shares (ordinary or preference), investing in bonds, gilt edges etc. These are excellent ways of saving surplus funds for future.

Besides safe keeping our income and assets in money market – banks etc and non-banking financial houses like insurance companies; surplus funds can be invested on Real Estates and importantly financial Securities.

Most investors in financial securities are interested in earning the periodic Dividends from shares and also interests from other securities. Thence, this gains attracted investors to daily monitoring of stocks /shares trading and Stock Market activities as shown in the schedule above.

Skilled investors are interested in outcome of Earning per Share (EPS), Returns on investments (ROI) among others. Bonuses are sometimes issued by companies to increase interest of investors in the companies.

In spite of the fact that Security can be a good source of saving for future, its certificates sometimes accepted as Collateral, Estate or Will for loved ones; security is prone to devaluation during inflation or depression.

Management In A Nutshell

Management, in practice, is getting people doing what are expected to achieve pre-set objectives and goals within a given period of time.

Most managers of resources especially the government employees and political appointees have poor managerial skills but do things on intuitions, previous experiences, prejudice and depend mostly on sycophants and/or trusted subordinates to perform.

Management principles are ignored by none management professionals especially hierarchy of information flow and allocation of tasks. Some political appointees prefer passing vital tasks to junior employees and by-pass superiors because of personal goals pursuit or lack of managerial ability.

Managerial ability inadequacy has been a great problem in developing economies leading to mismanagement of available resources and impoverishment of the people.

Panacea to this economic cankerworm is gradual professionalism of key resources management offices.

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