Developed by Nobel prize-winning economist James Tobin, Tobin’s Q is a financial ratio and valuation tool that can be applied either to individual businesses or to the stock market as a whole. In this article, we introduce Tobin’s Q Ratio and reflect upon some of its strengths and weaknesses.

Like this:
Like Loading...
Categories: Investopedia
Tagged as: arithmetic mean, Fed, Federal Reserve, financial assets, financial ratio, flow of funds, geometric mean, goodwill, intangible assets, intrinsic value, James Tobin, misvaluation, overvaluation, replacement value, stock-market valuation, Tobin's Q, Tobin's Q Ratio, undervaluation, value investing, Z.1 Financial Accounts