SMOOTHING Definition

SMOOTHING is a widely used technique in forecasting trends, seasonality and level change, e.g. averaging month-to-month fluctuations. Works well with data that has a lot of randomness.

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FDIC see FEDERAL DEPOSIT INSURANCE CORPORATION.

PRICE TO EARNINGS RATIO (P/E) is a performance benchmark that can be used as a comparison against other companies or within the stocks own historical performance. For instance, if a stock has historically run at a P/E of 35 and the current P/E is 12, you may want to explore the reasons for the drastic change. If you believe that the ratio is too low, you may want to buy the stock. You will generally find a P/E ratio based on either the prior reporting years earnings, or the earnings of the prior four quarters added together (LTM or Latest Twelve Months). Formula: Stock Price divided by the Earnings Per Share.

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