Reference

Glossary Terms

Browse our comprehensive glossary of terms. Search, filter by topic, or navigate alphabetically.

463 Total Terms
18 Topics

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8 terms
403(b) A 403(b) plan is a tax-advantaged retirement savings account designed specifically for employees of certain tax-exempt organizations, such… Retirement Planning 10-K The 10-K is an annual report that publicly traded companies must file with the U.S. Securities and Exchange… Financial Statements & Accounting 10-Q The 10-Q is a detailed financial report that publicly traded companies in the United States must file with… Financial Statements & Accounting Stocks & Equity Markets

A

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Accrual accounting Accrual accounting is a fundamental method of financial reporting where revenue and expenses are recorded when they are… Financial Statements & Accounting Accounts receivable Accounts receivable (AR) is the money owed to a business by its customers for goods or services that… Financial Statements & Accounting Appraisal An appraisal is a professional estimate of the market value of a property, such as a home, land,… Real Estate & Mortgage Finance

B

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Bankruptcy – Chapter 11 Bankruptcy – Chapter 11 is a legal process for businesses (and sometimes individuals with high levels of debt)… Credit, Debt & Lending Budget deficit A budget deficit occurs when a government’s total expenditures exceed its total revenues over a specific period, typically… Monetary & Fiscal Policy Bond A bond is a fixed-income financial instrument that represents a loan made by an investor to a borrower,… Bonds & Fixed Income

C

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Core inflation Core inflation is a measure of inflation that excludes the prices of food and energy. These categories are… Economics for Finance Credit utilization ratio Your credit utilization ratio is a key number that shows how much of your available credit you are… Credit, Debt & Lending CPI (Consumer Price Index) The Consumer Price Index (CPI) is a key economic indicator that measures the average change over time in… Economics for Finance

D

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Debit card A debit card is a payment card issued by a bank or credit union that allows you to… Banking & Depository Institutions Day order A day order is a type of order to buy or sell a security that is valid only… Financial Markets & Market Mechanics Depreciation Depreciation is a fundamental accounting concept that allocates the cost of a tangible asset over its useful life.… Financial Statements & Accounting

E

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ERISA ERISA, the Employee Retirement Income Security Act of 1974, is a landmark federal law that sets minimum standards… Retirement Planning Experian Experian is one of the three major credit reporting agencies (along with Equifax and TransUnion) that collect and… Credit, Debt & Lending Equity financing Equity financing is a method of raising capital for a company by selling ownership shares, known as equity,… Corporate Finance

F

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Free cash flow (FCF) Free cash flow (FCF) is the cash a company generates after spending the money required to maintain or… Corporate Finance Form S-1 Form S-1 is a registration statement filed with the Securities and Exchange Commission (SEC) by companies planning to… Financial Regulation Free cash flow yield Free cash flow yield is a financial ratio that measures how much free cash flow a company generates… Financial Ratios & Analysis

G

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Gross profit Gross profit is the profit a company makes after deducting the costs directly tied to producing and selling… Financial Statements & Accounting Goodwill Goodwill is an intangible asset that arises when one company purchases another company for a price greater than… Financial Statements & Accounting Gift tax The gift tax is a federal tax in the United States imposed on the transfer of property or… Taxation

H

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Hawkish vs. dovish In the world of central banking and monetary policy, the terms hawkish and dovish describe the general attitude… Monetary & Fiscal Policy HELOC A Home Equity Line of Credit (HELOC) is a type of revolving debt that allows you to borrow… Real Estate & Mortgage Finance Homeowners insurance Homeowners insurance is a type of property insurance that protects an individual’s home and personal belongings against damage,… Insurance & Risk Protection

I

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Installment debt Installment debt is a type of loan that is repaid over time with a set number of scheduled… Credit, Debt & Lending Income (investment) Investment income is money you earn from your investments without having to work for it actively. Instead of… Investing Fundamentals Inflation Inflation is the rate at which the general level of prices for goods and services rises over a… Economics for Finance

J

2 terms
Jumbo loan A jumbo loan is a type of mortgage used to finance properties that are too expensive for a… Real Estate & Mortgage Finance JOBS Act The JOBS Act, officially the Jumpstart Our Business Startups Act, is a landmark piece of U.S. legislation signed… Financial Regulation

L

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Loan origination fee A loan origination fee is an upfront charge imposed by a lender to process, underwrite, and fund a… Credit, Debt & Lending Long-term disability insurance Long-term disability insurance (LTD) is a type of insurance policy that provides income replacement if you become unable… Insurance & Risk Protection Long-term capital gains Long-term capital gains are the profits you earn from selling an asset that you have held for more… Taxation

M

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Money supply – M3 Money supply M3 is a broad measure of the total amount of money circulating in an economy. It… Monetary & Fiscal Policy Mortgage A mortgage is a type of secured loan used to finance the purchase of real estate, such as… Real Estate & Mortgage Finance Micro-cap A micro-cap (or micro-cap stock) refers to the equity of a publicly traded company with a relatively small… Stocks & Equity Markets

N

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Net present value (NPV) Net Present Value (NPV) is a core concept in corporate finance used to evaluate the profitability of an… Corporate Finance Net income Net income is the bottom line of a company’s income statement. It represents the total profit a business… Financial Statements & Accounting Needs vs. wants Needs vs. wants is a fundamental concept in personal finance and budgeting that helps individuals distinguish between essential… Personal Finance & Money Management

O

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Order book An order book is a real-time, electronic list of buy and sell orders for a specific financial security,… Financial Markets & Market Mechanics Open market operations Open market operations (OMO) are the primary tool used by the Federal Reserve System to influence the supply… Monetary & Fiscal Policy Overdraft An overdraft occurs when you spend more money than you have available in your checking account. In simple… Banking & Depository Institutions

P

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PPI (Producer Price Index) The Producer Price Index (PPI) is a crucial economic indicator that measures the average change over time in… Economics for Finance Productivity In economics and finance, Productivity measures how efficiently inputs (like labor, capital, and materials) are converted into useful… Economics for Finance Prospectus A prospectus is a formal legal document that describes a security offering for sale to the public. It… Mutual Funds, ETFs & Pooled Vehicles

Q

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Quantitative easing (QE) Quantitative easing (QE) is an unconventional monetary policy tool used by a central bank — like the U.S.… Monetary & Fiscal Policy Qualified dividend A qualified dividend is a type of dividend payment that meets specific criteria set by the Internal Revenue… Taxation Quick (acid-test) ratio The quick ratio, also known as the acid-test ratio, is a stringent measure of a company’s short-term liquidity.… Financial Ratios & Analysis

R

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Revenue Revenue (also called sales, turnover, or the top line) is the total amount of money a company earns… Financial Statements & Accounting Risk tolerance Risk tolerance is the degree of variability in investment returns that an individual is willing to withstand as… Investing Fundamentals Recession A recession is a significant, widespread, and prolonged downturn in economic activity. While there is no single, universally… Economics for Finance

S

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Share buyback / repurchase A share buyback, also known as a share repurchase, is a corporate action in which a company buys… Stocks & Equity Markets Securities Exchange Act of 1934 The Securities Exchange Act of 1934 is a landmark United States federal law that created the legal framework… Financial Regulation Settlement (T+1) Settlement (T+1) refers to the standard timeline by which a securities trade must be finalized after the transaction… Financial Markets & Market Mechanics

T

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Tax-loss harvesting Tax-loss harvesting is a strategy used by investors to reduce their taxable income by selling investments that have… Taxation Tax-deferred Tax-deferred refers to a type of investment or savings account where you do not pay taxes on the… Taxation Tracking error Tracking error is a measure of how closely a mutual fund or exchange-traded fund (ETF) follows its benchmark… Mutual Funds, ETFs & Pooled Vehicles

U

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Underwriting Underwriting is the process by which a lender, insurer, or investment bank evaluates the risk involved in a… Insurance & Risk Protection Unsecured debt Unsecured debt is a type of loan or credit that is not backed by any form of collateral.… Credit, Debt & Lending Unemployment rate The unemployment rate is a key economic indicator that measures the percentage of the labor force that is… Economics for Finance

V

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VA loan A VA loan is a mortgage loan in the United States guaranteed by the U.S. Department of Veterans… Real Estate & Mortgage Finance Variable expenses Variable expenses are costs that change from month to month based on your consumption, choices, or needs. Unlike… Personal Finance & Money Management Vesting Vesting is a legal and financial term that refers to the process by which an employee earns the… Retirement Planning

W

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Working capital Working capital is a financial metric that represents the difference between a company’s current assets and current liabilities.… Corporate Finance Weighted average cost of capital (WACC) The Weighted Average Cost of Capital (WACC) is a financial metric that represents the average rate of return… Corporate Finance Whole life insurance Whole life insurance is a type of permanent life insurance that provides coverage for the insured’s entire lifetime,… Insurance & Risk Protection

Y

3 terms
Yield curve The yield curve is a graphical representation that shows the relationship between interest rates (yields) and the time… Bonds & Fixed Income Yield Yield is a financial term that measures the income generated by an investment, typically expressed as a percentage… Investing Fundamentals Yield to maturity (YTM) Yield to Maturity (YTM) is the total return anticipated on a bond if it is held until it… Bonds & Fixed Income

Z

2 terms
Zero-based budgeting Zero-based budgeting (ZBB) is a method of budgeting where every expense must be justified for each new period,… Personal Finance & Money Management Zero-coupon bond A zero-coupon bond is a type of bond that does not pay periodic interest payments (coupons) to its… Bonds & Fixed Income