July 1, 2020 at 5:01 pm #19652Ivan DameParticipant
Predicting price movements of currency pairs is difficult because there are many factors that fluctuate the market. Trades should be aware of central bank decisions and announcements, political news, and market sentiment so traders won’t be surprised. However, my broker ForexChief provides me with all of those in my trading platform. So it is very helpful in the time of analysisJuly 8, 2020 at 1:04 am #20523RobertParticipant
Forex is a fluctuated market. The price always fluctuates in this market. So, it is quite tough to assume the price earlier. anything can happen at any time in this volatile market. As a trader, I always try to make the trade easy and simple. Because I don’t want to face any losses. My broker Tpglobalfx helps me a lot to make a profit. They are really helpful.August 27, 2020 at 11:40 pm #24399Manfredo TrentiniParticipant
The prediction of prices in the forex market is a little bit difficult. Every trader should keep eyes on political effect, the decision of the central bank. If a trader can predict price movement in the forex market then it is quite easy for them to trade in the forex market. Strong knowledge and reliable broker make it easier to earn money from the forex market. My broker Eurotrader is very helpful. They are really very helpful and supportive. They never make disappointment to their client.October 29, 2020 at 3:11 am #28457ChristianoParticipant
Brokers are very important issues in trading. If the broker is not good, it is very difficult to make a profit in trading. The broker protects your investment. Brokers offer many types of benefits. So a good broker is very much needed to develop good skills in trading. Forex4you has made my trading life enjoyable with their blessing opportunities and their support is always active.November 3, 2020 at 9:13 pm #28581freeforex20Participant
What is the book value of the common share?
Book value per common share (or simply book value per share – BVPS) is a method of calculating the book value per share of a company based on the equity of the common shareholders in the company. A company’s book value is the difference between that company’s total assets and total liabilities, not its market share price.
In the event of the dissolution of the company, the book value of each ordinary share indicates the remaining dollar value of the ordinary shareholders after all assets are liquidated and all debtors are paid.
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Understand the book value
The equation for the book value of a common share is:
Book value per ordinary share (formula below) is an accounting measure based on historical transactions:
What does BVPS tell you?
The book value of ordinary shares in the numerator reflects the original returns that the company receives from the issuance of ordinary shares, which are increased by profits or decreased due to losses, and decreased by dividends paid. Company share buybacks reduce the book value and the total number of common shares. Stock buybacks occur at current stock prices, which can lead to a significant reduction in the company’s book value per common stock. The number of common shares used in the denominator is usually the average number of diluted ordinary shares of the past year, which takes into account any additional shares other than the number of underlying shares that could arise from stock options, guarantees, preferred shares, and other convertible instruments.
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Example of BVPS
As a hypothetical example, suppose XYZ Manufacturing’s common stock balance is $ 10 million, and one million shares of common stock outstanding, which means that BVPS is ($ 10 million / 1 million shares), or $ 10 per share. If XYZ manages to generate higher profits and uses those profits to buy more assets or reduce liabilities, the company’s common stock increases. For example, if a company makes a profit of $ 500,000 and uses $ 200,000 of the profits to purchase the assets, the common stock increases along with the BVPS. On the other hand, if XYZ uses $ 300,000 in dividends to reduce liabilities, the common stock also increases.
The difference between the market value of the share and the book value of the share
The market value per share is the company’s current share price, and it reflects the value that market participants are willing to pay for their regular share. Book value per share is calculated using historical costs, but market value per share is a forward-looking measure that takes into account the firm’s future earnings strength. With increases in the company’s estimated profitability, projected growth, and soundness of its business, the market value per share grows higher. Material differences arise between the book value per share and the market value per share due to the ways in which accounting principles classify certain transactions.
For example, consider a company’s brand value, which was created through a series of marketing campaigns. US Generally Accepted Accounting Principles (GAAP) require marketing costs to be spent promptly, which reduces the book value per share.1 However, if the advertising efforts enhance the company’s product image, the company can charge premium rates and create brand value. Market demand may lead to an increase in the share price, which creates a large discrepancy between the market and the book values per share.
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The difference between book value of common stock and net asset value (NAV)
Whereas, BVPS considers the residual equity per share of the company’s shares, net asset value, or NAV, to be the value per share computed for a mutual fund, exchange-traded fund, or ETF. For any of these investments, the net asset value is calculated by dividing the total value of all fund securities by the total number of fund shares outstanding. NAV is created daily for mutual funds. A number of analysts consider total annual return to be a better and more accurate measure of mutual fund performance, but net asset value is still used as an easy-to-use interim valuation tool.
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Because the book value per share only takes into account book value, it fails to incorporate other intangible factors that may increase the market value of the company’s shares, even upon liquidation. For example, high-tech banks or software companies often have very little tangible assets in relation to their intellectual property and human capital (workforce). These intangible assets will not always be taken into account in the book value calculation.November 18, 2020 at 6:36 pm #28885Thomas HoffmanParticipant
Forex is a currency exchange market where trader can make money by predicting price movements. However, it is not so easy what most people think. Trader need knowledge and experience to do that. It is also difficult make right prediction in all time. So, lose is unavoidable. Trader have to accept that fact. I also accept the fact and trading with Eurotrader which give me best trading condition in the market
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