https://youtu.be/JUoVzH3P1yk
Revenue is the wrong denominator for this income tax ratio. In our hypothetical example, revenue is one hundred million dollars. Profit before tax is ten million dollars, and income tax expense is two million dollars. Tax expense divided by profit before tax gives twenty percent. Dividing that same tax expense by revenue gives two percent. Those...
https://youtu.be/TE0hESfO29c
Cash runway is a scenario, not an expiration date. Imagine a hypothetical business has twelve million dollars of available cash and uses one million dollars of net cash per month. Holding that rate constant gives twelve months of runway. If net monthly cash use rises to one point five million dollars, the same cash lasts eight months. If it fall...
https://youtu.be/_yKj_6P0yKE
Retained earnings are not a separate pile of cash. Imagine a hypothetical company begins with twenty million dollars of retained earnings, earns five million in net income, and declares two million dividends. Ignoring other adjustments, ending retained earnings are twenty three million dollars. The three million increase does not prove cash rose...
https://youtu.be/Dmbg0jvdNO0
A higher priority bond claim is not a guarantee of full recovery. Imagine a simplified default where sixty million dollars remains for one class of equal ranking bond claims totaling one hundred million dollars. If that entire amount is distributed proportionally to that class, the recovery is sixty cents per dollar. Real bankruptcy outcomes dep...
https://youtu.be/B7T4Pumh87g
A floating coupon does not necessarily change every time market rates move. Imagine a hypothetical bond pays a reference rate plus two percentage points. At its reset date, the reference rate is three percent, making the annual coupon rate five percent. On one thousand dollars of principal, that rate corresponds to fifty dollars of annual intere...
https://youtu.be/WZVU5h-K0yI
Operating profit can rise while net profit falls. Imagine a simplified business earns ten million dollars of operating profit, pays two million of interest expense, and records two million of income tax expense. Net income is six million dollars. Next year, operating profit rises to twelve million dollars, but interest expense rises to five mill...
https://youtu.be/U060dzD6LEk
Collecting an old invoice does not create the same sale twice. Imagine a business already recognized ten thousand dollars of revenue and a matching customer receivable when the sale qualified for recognition. The customer had not paid yet. When the customer later pays ten thousand dollars, cash rises and the receivable falls by the same amount. ...
https://youtu.be/JMUHSokmMi8
Book equity and stock market value answer different questions. Imagine a hypothetical balance sheet reports five hundred million dollars of assets and three hundred million dollars of liabilities. The residual book equity is two hundred million dollars. If ten million shares trade at thirty dollars each, the equity market value is three hundred ...
https://youtu.be/lcO51UixWas
Two price earnings ratios can describe the same stock if the earnings inputs differ. Imagine a share price of sixty dollars and earnings per share of three dollars over the last twelve months. The trailing ratio is twenty. Now suppose an analyst forecasts four dollars of earnings per share for the next year. Dividing the same sixty dollar price ...
https://youtu.be/tt36yBynFYI
A fuel price increase does not translate into the same percentage change in airline profit. Imagine a hypothetical airline buys one million gallons at two dollars per gallon. The fuel bill is two million dollars. If the price rises to two dollars fifty and the gallons stay unchanged, the bill becomes two point five million dollars. That is five ...
https://youtu.be/YLq8v9hoV8M
A red candle does not mean every share was sold without a buyer. This historical Alphabet IEX interval opens at three fifty two point six one five and closes at three fifty one point three seven. Its reported volume totals six thousand eight hundred ninety five shares. The lower close makes the candle red. The volume measures shares traded, not ...
https://youtu.be/aoGU9xlzQgk
Two different volume averages can both be correct if their denominators differ. This historical Deere IEX extract covers the five minute window starting at fifteen ten UTC. Only two minute rows are reported in that window. Those rows contain three hundred fifty six and forty five shares, for four hundred one observed shares. Divide by two report...
https://youtu.be/SQmY5kOz8Bw
A dollar range needs a reference price before you can compare it as a percentage. This historical Johnson and Johnson IEX interval begins at fifteen ten UTC on October eighth, twenty twenty six. Its first observed open is two fifty two point seven five five. The interval high is two fifty three point zero eight. Its low is two fifty two point se...
https://youtu.be/NtCCfKKOsvU
A five minute candle shows a high and low, but not which happened first. In this historical Amazon IEX example, the highlighted interval has a high of two fifty nine point seven three and a low of two fifty nine point one seven. The underlying minute observations resolve part of that uncertainty. The high appears in the fifteen ten UTC minute. T...
https://youtu.be/h1O9PBQsFrM
Forty three thousand shares does not mean forty three thousand investors. This historical Bank of America example uses IEX observations from October eighth, twenty twenty six. The highlighted five minute interval begins at fifteen ten UTC. Add the five reported minute volumes: forty three thousand one hundred forty shares. Add their trade counts...
https://youtu.be/128LTEEgd88
A candle timestamp can mark its beginning, not the moment its final close was known. This Costco example groups historical IEX observations into the five minute interval starting at fifteen ten UTC. Its final observed close is nine forty five point six six. That final close comes from the fifteen fourteen minute observation. It was not informati...
https://youtu.be/npL-NFx4_18
You cannot combine minute VWAP values by blindly averaging them. This historical ExxonMobil IEX window contains four observed minute bars. Their volumes are seven forty four, three fifty six, six forty nine, and two fifty six shares. The total is two thousand five shares. Multiply each reported minute VWAP by its own volume, add those products, ...
https://youtu.be/2OsHN5_CnWg
A missing data row is not evidence that a stock stopped trading. This historical AMD IEX extract has observations stamped fifteen ten, fifteen eleven, fifteen thirteen, and fifteen fourteen UTC. There is no fifteen twelve row in this five minute window. That gives four observed minute bars, not five. It does not establish zero trading across eve...
https://youtu.be/puxkwCXlsKA
A small candle range can miss a gap from the previous close. In this historical JPMorgan IEX example, the highlighted five minute bar has a high of three twenty seven point nine two and a low of three twenty seven point seven two. Its high minus low is twenty cents. But the previous bar closed at three twenty seven point four one. The distance f...
https://youtu.be/HcU5U3zDHXE
A five minute candle close is not the average of five closes. This Microsoft example uses historical IEX observations from October eighth, twenty twenty six. The highlighted interval begins at fifteen ten UTC. It contains five one minute bars. The first open is five thirty point nine zero. The highest high is also five thirty point nine zero. Th...
https://youtu.be/_uf-yGgl7SA
A rising cash balance does not necessarily mean customers bought more. Imagine a business starts with twenty thousand dollars in cash and borrows eighty thousand dollars. Ignore fees and all other activity in this simplified example. Cash rises to one hundred thousand dollars, but debt also rises by eighty thousand. The loan proceeds are a finan...
https://youtu.be/bfMaNzPRlm8
Two businesses can show the same current ratio and very different cash situations. Imagine each has two hundred thousand dollars of current assets and one hundred thousand dollars of current liabilities. Both current ratios equal two. In the first business, one hundred eighty thousand dollars of those assets is cash. In the second, only twenty t...
https://youtu.be/-o3Sy8_W5xs
Depreciation is not another cash purchase every year. Imagine a business pays fifty thousand dollars in cash for equipment. Assume a five year useful life, no residual value, and straight line depreciation for this simplified example. The annual depreciation expense is ten thousand dollars. The original fifty thousand dollar payment and the annu...
https://youtu.be/rcI2BSfIYYg
Interest can be earned before cash arrives. Accrued interest means interest earned on a security but not yet paid to the investor. That distinction matters when a bond pays coupons only on specified dates. Imagine a bond promises a thirty dollar coupon for a coupon period. If exactly one third of that period has accrued under its applicable conv...
https://youtu.be/mk8F_ZFejA4
A ten percent stock decline can reduce your own account equity by much more. Imagine buying ten thousand dollars of stock using five thousand dollars of your cash and five thousand borrowed dollars. Starting equity is five thousand dollars. Now the stock value falls to nine thousand dollars. The five thousand dollar loan has not disappeared. Sub...
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