Investment & trading encyclopedia

Understand investment products, market mechanics, indicators and research terminology. Each entry includes an explanation, example, cautions and related learning.

80 explained termsView all courses

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Stocks & valuationIntermediate

Price-to-Book Ratio (P/B)

The price-to-book ratio compares a stock's market price with the accounting value of shareholders' equity per share. It indicates how much the market pays for each unit of net assets recorded on the balance sheet.

Stocks & valuationBeginner

Price-to-Earnings Ratio (P/E)

The price-to-earnings ratio compares a stock's share price with the company's earnings per share. It shows how many units of currency the market currently pays for one unit of annual earnings.