The U.S. Versus the Rest of the World: Divergence and Correction
Andrew Harmstone | Oct 2018
Trade and tariff rhetoric has weakened business fixed investment and thrown sand into the gears of the global economy. While it is still moving forward, we see clear signs it may be slipping a bit.
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Capital expenditure, or CapEx, are funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment. Correlation is a statistical measure of how two securities move in relation to each other. The Nasdaq Composite Index is a stock market index of the common stocks and similar securities listed on the NASDAQ stock market. It is used as an indicator of the performance of stocks of technology companies and growth companies. Since both U.S. and non-U.S. companies are listed on the NASDAQ stock market, the index is not exclusively a U.S. index. Price-To-Book Value (PBV) is a valuation ratio calculated as price per share divided by book value per share. Price/earnings (P/E) is the price of a stock divided by its earnings per share. Sometimes called the multiple, P/E gives investors an idea of how much they are paying for a company’s earning power. The higher the P/E, the more investors are paying, and therefore the more earnings growth they are expecting. Price-To-Sales (P/S) is the ratio of a company’s share price to its revenue from sales over a given period of time. The North American Free Trade Agreement (NAFTA) is an agreement among the United States, Canada and Mexico designed to remove tariff barriers between the three countries. Volatility is measured by calculating the standard deviation of the annualized returns over a given period of time. It shows the range to which the price of a security may increase or decrease.
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