When measuring a company's risk, look no further than the debt ratio -- a simple, yet effective formula used to quantify how leveraged a company truly is.
But before you go crazy with your scientific calculator, be sure you understand how debt ratio works. For not all debt ratios are created equal.
In the latest installment of InvestingAnswers.com's Video Definition series, our Managing Editor, Sara Glakas, takes a creative, easy-to-understand look at this piece of data and why it can be so useful when you're deciding whether to buy stock in a company.
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