Dividend Irrelevance Theory
What is the Dividend Irrelevance Theory? Dividend Irrelevance Theory is a financial theory that claims that the issuing of dividends does not increase a company’s potential profitability or its stock price. It suggests that investors are not better off owning shares of companies that issue dividends than shares of those that do not. Stock Price and...
Voluntary Reserve
What is a Voluntary Reserve? A voluntary reserve is a financial reserve held by insurance companies. The reserves are frequently regulated by government agencies to ensure the solvency of an insurance company. Voluntary reserves are additionally held as liquid assets. Understanding Voluntary Reserves To appear financially stable and improve liquidity ratios, insurance companies will hold voluntary...
Vice Fund
What is the Vice Fund? The Vice Fund, managed by USA Mutuals, is a mutual fund that invests in alcoholic drinks, tobacco, gambling, and defense industries. The word vice means immoral and wicked behavior, indicating the somewhat questionable investment strategy adopted by the Vice Fund. Origins and Philosophy of the Vice Fund In 2001, the...
Medical Cost Ratio (MCR)
What is Medical Cost Ratio (MCR)? Medical cost ratio (MCR), commonly known as medical loss ratio or medical benefit ratio, compares a health insurance company’s healthcare-related costs to its revenue premium. The ratio is frequently used to determine the financial strength of an insurance company, as it informs the percentage of revenue that goes towards...
Turnaround Recovery Strategies
What are Turnaround Recovery Strategies? Turnaround recovery strategies are a range of measures that companies employ to recover from a period of a performance decline. The range of measures is important since they mark an upturn phase of a company after a period of significant negativity. The concept of turnaround strategies is also applicable in...
