Hands-On Machine Learning for Algorithmic Trading

Key metrics

There is a large number of valuation proxies computed from fundamental data. These factors can be combined as inputs into a machine learning valuation model to predict prices. We will see examples of how some of these factors are used in practice in the following chapters:

Factor	Description
Cash flow yield	The ratio divides the operational cash flow per share by the share price. A higher ratio implies better cash returns for shareholders (if paid out using dividends or share buybacks, or profitably reinvested in the business).
Free cash flow yield	The ratio divides the free cash flow per share, which reflects the amount of cash available for distribution after necessary expenses and investments, by the share ...