All key Financial Ratios and its types with simple Examples


Financial ratios are primarily tools for turning the data in financial statements into information used by managers and executives to better understand what is happening in a company. These ratios are used in evaluating an acquisition, creating Pro-forma statements related to potential courses of action, or figuring out which stock to buy or where to invest

Financial ratios can typically be grouped into six types. Each Ratios are explained in a separate post with examples for better understanding.

Click on each ratios and empower yourself in decision making by understanding financial ratios and statements.

Profitability ratios

Current yield
Net profit margin
Return on assets (ROA)
Return on net assets (RONA)
Return on equity (ROE)
Return on investment (ROI)

Debt ratios

Asset to equity ratio or Equity multiplier ratio
Asset turnover ratio
Cash flow to debt ratio
Debt ratio or Debt to asset ratio or Debt to capital ratio
Debt to equity ratio
Interest coverage ratio

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Author and Assistant Professor in Finance, Ardent fan of Arsenal FC. Always believe "The only good is knowledge and the only evil is ignorance - Socrates"
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