Leverage Analysis | Ratios | Financial Institutions Comparison

Leverage Analysis

Leverage Analysis of Financial Institutions

I wanted to post up this image (courtesy of Paul Kedrosky), because it illustrates the amount of leverage employed at various financial institutions. Numerous institutions on this list have high leverage. And, the scary part is that many of them have increased leverage from 2007 to 2008.

(click to enlarge)

Then, take the info above and compare it to a list from my previous post on financial institutions regarding writedowns, losses, and capital raised. Although the data is very generalized and does not offer specifics into each institution's situation, it still provides us with a list of some banks that would make very good shorts assumming the short selling ban on financials is not in place. After all, a mix of high leverage, large writedowns, and low capital raised can be quite deadly.

(click to enlarge)

Leverage Image Source: Paul Kedrosky

by Market Folly

Related to:

Tags: Leverage Analysis, Leverage Business, Leverage Ratio Definition, Define Leverage, Financial Leverage, Operating Leverage, Leverage Finance, Leverage Fund, Leverage Software, Leverage Tools

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.

Hedge Fund Videos | 30+ Free Videos on Hedge Funds