President Trump didn't exactly boot Steve Bannon from his ruling circle of relatives and Wall Street hotshots he might like to have as relatives. True, he threw Bannon off the National Security Council in an abrupt manner. And he piled further indignity on the self-proclaimed architect of hiâ¦ Read more.
What is the 'Acid-Test Ratio'. The acid-test ratio is a strong indicator of whether a firm has sufficient short-term assets to cover its immediate liabilities. Commonly known as the quick ratio, this metric is more robust than the current ratio, also known as the working capital ratio, since it ignores illiquid assets such as inventory. Calculated by:
This ratio is just the Sharpe ratio, only using minimum acceptable return instead of the risk-free rate in the numerator, and using standard deviation of returns instead of standard deviation of excess returns in the denominator. In 1966, William F. Sharpe developed what is now known as the Sharpe ratio. Sharpe originally called it the reward-to-variability ratio before it began being called the Sharpe ratio by later academics and financial operators. The definition was: