Company analysis
What is working capital?
The money tied up in running day to day operations.
Explained in more detail
It is what a company has in inventory and owed by customers, minus what it owes suppliers. Rising working capital while sales stay flat usually means customers are paying more slowly or goods are not selling.
An example
For instanceA company whose customers take 120 days to pay has a lot of cash locked up.
Why this matters to you
You will meet this word in broker apps, company results and market news. Knowing what it means is not the goal on its own. The goal is being able to judge whether a number is good or bad for the investment you are actually holding.
On AlphaVik, any time working capital appears in a view or a lesson, you can hover or tap the word and this explanation comes with it. You never have to leave the page to look something up.