The technology and clothing sector Essay
Based on the standard deviations and means across industries with respect to recognized variables, it can be argued that the technology and clothing sector have improved their financial performance over the last year. Note that the standard deviation of the technology sector is 1. 64 – a small variation from the mean. Note that the earnings per share of the same industry indicate an improvement. Note also that the mean returns on equity for both industries are 56. 58 and 18.
14 respectively with comparatively small deviations (using ratio). The other three industries showed little or no improvement in their financial performance. Note that although the standard deviation is small compared to the technology and clothing sectors, its ratios are almost equal to 1, indicating slow growth. Note that both the technology and clothing sectors have a current ratio >1 ) From a statistical point of view, this can possibly indicate a decrease or perhaps increase in the financial functionality. Using the returning on collateral ratios, we could verify that both industrial sectors have improved their economical performance.
Note again that calculating the mean/SD proportion for the said varying, the two industries will deliver about. 25 (technology) and 3. 206. Based on the t-test, there may be significant correlation between the technology and clothing industries. The correlation can be defined as negatively related. nonsignificant adverse correlation (weak relationship) can be found between the technology and programs sectors, and utilities and clothing areas.
All other reveal weak confident relationship. Primarily based from theory, it is possible the fact that sectors which may have strong bad relationship remain competitive for the same resources such as recycleables or labor, all other items follow suit. It may be possible to invest in possibly the technology or apparel industries for two apparent reasons. An increase in the dimensions of one sector will cause a decrease in the size of the other industry. Investing in one of many industry will make sure higher produces in the future.
In addition , much of the various other industries show lower returns. In short, the larger the risks (as in the case of the technology and clothing industries – and the negative relationship), the higher the rate of returning. A more attractive strategy of investment should be to subdivide the investment collection into two parts – those reserved for the technology sector and the ones reserved for the product sector. Let’s say the technology sector diminishes in size or perhaps showed poor financial functionality, then the expenditure on the clothes sector is going to inevitably cause increased results.
Again, buying the additional sectors will certainly either cause poor earnings or lost investment.