Why Is Plowback the Overwhelming Favorite Among Choices of Sources

question 153

Essay

Why is plowback the overwhelming favorite among choices of sources of funds for financing corporate investment?

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Definitions:

Portfolio Management

The science and art of making decisions about investment mix and policy, matching investments to objectives, asset allocation, and balancing risk against performance.

Asset Value

The value of a company's assets, often used in determining its worth or the value of its shares.

Expected Excess Return

The additional return investors anticipate receiving on an investment over the risk-free rate as compensation for taking on higher risk.

Expected Return

The forecasted amount of profit or loss an investment is likely to generate over a given period.