Overcapitalisation & overtrading

Sir can you please correct me where I’m wrong about overcapitalization & overtrading and their indicators?

Overcapitalisation is where excessive investment is made by the business in its current assets.

That means the Current ratio will increase due to higher assets & lower liabilities. Whereas the receivable & inventory increase but payable decreases.

But Overtrading is where a company does not have enough long-term finance to invest in current assets.

That means the Current ratio will fall due to lower assets but higher liabilities. Where the receivable & inventory decrease but payable will increase.