## Why Do CFD Traders Need to Know the Current Ratio?
**Current ratio** is a financial indicator that shows a company's ability to pay short-term debts. For CFD stock traders, it helps eliminate unsafe options. This ratio compares assets that can be converted into cash within a year to liabilities due within the same period. The higher the ratio, the more cash the company has to comfortably pay its debts.
## How is the Current Ratio Calculated?
Basic formula:
**Current Ratio = Current Assets ÷ Current Liabilities**
Let's look at a real example from Amazon in 2019:
- Current Assets: $96.3 billi
View Original**Current ratio** is a financial indicator that shows a company's ability to pay short-term debts. For CFD stock traders, it helps eliminate unsafe options. This ratio compares assets that can be converted into cash within a year to liabilities due within the same period. The higher the ratio, the more cash the company has to comfortably pay its debts.
## How is the Current Ratio Calculated?
Basic formula:
**Current Ratio = Current Assets ÷ Current Liabilities**
Let's look at a real example from Amazon in 2019:
- Current Assets: $96.3 billi
The abstract is generated by AI
