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Book Leverage

function
frds.measures.corporate.book_leverage(data)

Book leverage

The book leverage is defined as the amount of debts scaled by the firm's total debts plus common equity.

\text{Book Leverage}_{i,t} = \frac{DLTT_{i,t}+DLC_{i,t}}{DLTT_{i,t}+DLC_{i,t}+CEQ_{i,t}}

where DLTT is the long-term debt, DLC is the debt in current liabilities, and CEQ is the common equity, all from Compustat Fundamentals Annual WRDS.COMP.FUNDA.

Note

If CEQ is missing, the book leverage is treated as missing.

If data is a Fundamentals Quarterly dataset:

\text{Book Leverage}_{i,t} = \frac{DLTTQ_{i,t}+DLCQ_{i,t}}{DLTTQ_{i,t}+DLCQ_{i,t}+CEQQ_{i,t}}
Parameters
  • data (Union[Funda, Fundq]) Input dataset
Returns (Union[pd.Series, None])

Book leverage


Last update: June 3, 2021
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