-
useless on their own, only comparable across time and sector
- accounting rules/legislation may be different across the world
- ratios can change because of that
- companies can also polish their ratios
- easy to misuse and manipulate
- accounting rules/legislation may be different across the world
-
used to predict
- imprecise and hard to make
- hard to predict, since everyone is thinking about the same financial ratios
-
- pricing of stocks is immediate
-
- momentum in stock prices
-
- assets outperform in January