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Plain-English explainers about how the stock market works. Definitional, neutral, no investment advice.
Corporate actions
Plain-English guide to every kind of stock split ratio: forward (2:1, 10:1), reverse (1:10), fractional stock-dividend splits (51:50, 103:100) and spin-off chart-stitching ratios (Disney 2000:1973).
Why some companies pay shareholders in extra shares instead of cash, and why those distributions show up as 51:50 or 103:100 fractional splits in corporate-actions tables.
How a corporate spin-off works, what shareholders receive, why the parent share drops on the ex-date, and how data vendors record chart-stitching ratios like 2000:1973.
Cumulative split multiplier on stock-split tables: the running product formula, what reverse splits do, and how to read very large multiples.
Valuation & fundamentals
P/E ratio explained: the formula, trailing vs forward multiples, typical sector ranges, and why a high P/E is not automatically overvaluation.
How earnings per share is calculated, why analysts focus on diluted EPS, the role of preferred dividends, and how share buybacks lift EPS without changing the business.
The three profit margins — gross, operating, net — what each excludes, the formulas, why industry-typical ranges differ, and how margin differs from markup.
What selling, general & administrative (SG&A) includes on the income statement, the SG&A-to-revenue ratio for peer comparison, and how SG&A differs from COGS and R&D.
Returns & market mechanics
Why dividends compound over decades, the difference between split-adjusted and dividend-adjusted closes, and why long-horizon return numbers diverge so dramatically.
CAGR formula, why CAGR is not the same as arithmetic average return, the link to the Rule of 72, and reference points for long-run market and economic growth.