What is a Revolving Credit Facility? A revolving credit facility is a line of credit that is arranged between a bank and a business. It comes with an established maximum amount, and the business can access the funds at any time when needed. The other names for a revolving credit facility are operating line, bank…
What is Revenue Run Rate? Revenue Run Rate is an indicator of financial performance that takes a company’s current revenue in a certain period (a week, month, quarter, etc.) and converts it to an annual figure to get the full-year equivalent. This metric is often used by rapidly growing companies, as data that’s even a…
Project Finance – A Primer Project finance is the financial analysis of the complete life-cycle of a project. Typically, a cost-benefit analysis is used to determine if the economic benefits of a project are larger than the economic costs. The analysis is particularly important for long-term projects of growth CAPEX. The first step of the…
What are Public Securities? Public securities, also known as marketable securities, are debt or equity securities that are openly or easily traded in a market. In a previous article, the classification of such investment methods was further discussed. The securities are either equity or debt-based. An equity security is an investment based on the equity…
What is the Equity Capital Market? The equity capital market is a subset of the broader capital market, where financial institutions and companies interact to trade financial instruments and raise capital for companies. Equity capital markets are riskier than debt markets and, thus, also provide potentially higher returns. Instruments Traded in the Equity Capital Market…
What is Standard and Poor’s (S&P)? Standard & Poor’s is an American financial intelligence company that operates as a division of S&P Global. S&P is a market leader in the provision of financial market analysis, particularly in the provision of benchmark and investable indices and credit ratings for companies and countries. The S&P Global division…
What is the Variable Cost Ratio? The variable cost ratio is a cost accounting tool used to express a company’s variable production costs as a percentage of its net sales. The ratio is calculated by dividing the variable costs by the net revenues of the company. The company’s net revenue includes the sum of its…
What is VantageScore? VantageScore is a credit rating service that caters directly to individual consumers. It is a credit rating product that was jointly developed by three credit rating bureaus, i.e., Equifax, Experian, and TransUnion. The product was created as an alternative to the FICO score, which was developed by the Fair Isaac Corporation. What…
