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Financial Analysis to show your financial position
Financial Analysis to show the investors financial position can be
important for individual investors, as it is for companies.
A range of calculated ratios, values, and
percentages can be graphed to show the trend over time of how an
investor has been managing their finances. The ratios include: savings
ratio, debt service ratio, and solvency ratio. Up to 16 different values
or percentages can be plotted to see the visual impact of the investor’s
financial position.
- Solvency ratio shows how debt (liabilities) is
being used to pay for Assets. A negative (-ve) Solvency Ratio
would mean your debt is higher than the Asset value, so you would
not be able to repay the Liabilities if you sold the Assets for the
current values.
- Liquidity Ratio shows how easily you could pay
off Liabilities which are due to be paid in full in the 6 month
period after the date shown.
- Saving Ratio shows how much of your income you
are able to save.
- Debt Service Ratio shows how much of your
Income is used to service your debt (Liability payments).
- Debt Payment to available Income Ratio shows
the ability the make debt payments after paying all other expenses.