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Definition of Defensive Interval Ratio (DIR)

Definition: What is Defensive Interval Ratio?

Defensive interval ratio is also known as the defensive interval period (DIP) or basic defensive period (BDI).

Defensive Interval Ratio (DIR)

This ratio is the liquidity ratio which calculates the number of days a company manages its daily operating expenses through most liquid assets of the company without touching theĀ noncurrent assets.

For the measurement of the liquidity risk of the company Dir is the best ratio. High DIR is a positive sign.

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