9 Golden Rules of Stock Investing (Rule #2) 9 Golden Rules of Stock Investing (Rule #4)

9 Golden Rules of Stock Investing (Rule #3)

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Rule #3 : Look for return on network that is 25% or more. RONW clearly shows if a company is using funds efficiently and effectively. One way to judge capital efficiency is to compare profits with net worth. Net worth is the sum of the equity capital and retained profits. This is often shown as “reserve net of revolution” in a company’s accounts. The percentage of PAT to net worth is referred to as the return of net worth (RNOW) or ROE (Return on Equity)
Source: http://www.investinternals.com/