Reference

Glossary Terms

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

463 Total Terms
18 Topics

#

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 50/30/20 rule The 50/30/20 rule is a simple and popular budgeting framework that helps individuals manage their after-tax income by… Personal Finance & Money Management 1099 A 1099 form is a series of tax documents issued by the Internal Revenue Service (IRS) and used… Taxation

A

View all 29 terms →
Actuary An actuary is a highly skilled professional who uses mathematics, statistics, and financial theory to analyze and manage… Insurance & Risk Protection Assets Assets are economic resources that a business or individual owns or controls, expected to produce future benefits. In… Financial Statements & Accounting ACH transfer An ACH transfer is an electronic transfer of money between bank accounts through the Automated Clearing House (ACH)… Banking & Depository Institutions

B

View all 25 terms →
Beige Book The Beige Book, formally known as the Summary of Commentary on Current Economic Conditions by Federal Reserve District,… Monetary & Fiscal Policy Bank statement A bank statement is a document issued by a bank or credit union that summarizes all financial transactions… Banking & Depository Institutions Bull market A bull market is a prolonged period in financial markets when prices of assets, most commonly stocks, rise… Stocks & Equity Markets

C

View all 59 terms →
Comparative advantage Comparative advantage is a fundamental economic theory that explains how countries, businesses, or individuals can benefit from trade,… Economics for Finance Capital gain A capital gain is the increase in value of a capital asset—such as stocks, bonds, real estate, or… Investing Fundamentals CFPB (Consumer Financial Protection Bureau) The Consumer Financial Protection Bureau (CFPB) is a United States government agency responsible for making sure banks, lenders,… Financial Regulation

D

View all 36 terms →
Debt-to-income (DTI) ratio The Debt-to-Income (DTI) ratio is a personal finance metric that compares your total monthly debt payments to your… Credit, Debt & Lending DuPont analysis The DuPont analysis is a framework for breaking down the fundamental drivers of Return on Equity (ROE) into… Financial Ratios & Analysis Deflation Deflation is a general decline in prices for goods and services, occurring when the inflation rate falls below… Economics for Finance

E

View all 25 terms →
Elasticity Elasticity is an economic concept that measures how much one economic variable changes in response to a change… Economics for Finance Exchange rate An exchange rate is the price of one country’s currency expressed in terms of another country’s currency. It… Economics for Finance Exchange An exchange is a regulated marketplace where buyers and sellers come together to trade financial instruments such as… Financial Markets & Market Mechanics

F

View all 29 terms →
FDIC The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States government that protects depositors… Financial Regulation Fixed-rate mortgage A fixed-rate mortgage is a type of home loan where the interest rate remains constant for the entire… Real Estate & Mortgage Finance Forward guidance Forward guidance is a communication tool used by central banks, such as the Federal Reserve, to inform the… Monetary & Fiscal Policy

G

View all 10 terms →
Gross Domestic Product (GDP) Gross Domestic Product (GDP) is the total monetary value of all finished goods and services produced within a… Economics for Finance Glass-Steagall Act The Glass-Steagall Act (officially the Banking Act of 1933) was a landmark piece of U.S. legislation that created… Financial Regulation Goodwill Goodwill is an intangible asset that arises when one company purchases another company for a price greater than… Financial Statements & Accounting

H

View all 9 terms →
High-yield (junk) bond A high-yield bond, commonly known as a junk bond, is a type of bond that offers a higher… Bonds & Fixed Income Hard inquiry A hard inquiry (also called a hard pull or hard credit check) is a record of when a… Credit, Debt & Lending Household cash flow Household cash flow is the total amount of money moving into and out of a household over a… Personal Finance & Money Management

I

View all 19 terms →
Interest on reserve balances (IORB) Interest on reserve balances (IORB) is the interest rate that the Federal Reserve System pays to banks and… Monetary & Fiscal Policy Index fund An index fund is a type of exchange-traded fund or mutual fund designed to track the performance of… Mutual Funds, ETFs & Pooled Vehicles Income statement An income statement is one of the three core financial statements used by businesses, investors, and analysts to… Financial Statements & Accounting

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

View all 10 terms →
Labor force participation rate The labor force participation rate (LFPR) is a key economic metric that measures the percentage of a country’s… Economics for Finance Limit order A limit order is a type of order to buy or sell a security at a specific price… Financial Markets & Market Mechanics Loan-to-value (LTV) Loan-to-Value (LTV) is a critical financial ratio used by mortgage lenders to evaluate the risk of a loan.… Real Estate & Mortgage Finance

M

View all 23 terms →
Minimum balance A minimum balance is the lowest amount of money a bank or credit union requires you to keep… Banking & Depository Institutions Money supply – M1 Money supply – M1 is a measure of the most liquid forms of money in an economy. It… Monetary & Fiscal Policy Mid-cap Mid-cap, short for mid-capitalization, refers to companies with a market capitalization typically between $2 billion and $10 billion.… Stocks & Equity Markets

N

View all 18 terms →
Net asset value (NAV) Net asset value (NAV) represents the per-share market value of a mutual fund, exchange-traded fund (ETF), or other… Mutual Funds, ETFs & Pooled Vehicles NYSE The New York Stock Exchange (NYSE) is the world’s largest stock exchange by market capitalization, located at 11… Stocks & Equity Markets Net (take-home) income Net income, often called take-home pay, is the amount of money you actually receive after all deductions are… Personal Finance & Money Management

O

View all 12 terms →
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 Overdraft An overdraft occurs when you spend more money than you have available in your checking account. In simple… Banking & Depository Institutions Operating margin Operating margin is a profitability ratio that measures how much profit a company makes from its core business… Financial Ratios & Analysis

P

View all 28 terms →
Pay stub A pay stub, also known as a paycheck stub, earnings statement, or pay advice, is a document provided… Personal Finance & Money Management Profitability index The profitability index (PI) is a financial metric used in capital budgeting to evaluate the attractiveness of an… Corporate Finance PCE price index The PCE price index, or Personal Consumption Expenditures price index, is a measure of inflation in the United… Economics for Finance

Q

View all 5 terms →
Qualified plan A qualified plan is a retirement savings plan that meets the requirements of the Internal Revenue Code (IRC)… Retirement Planning 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 Qualified dividend A qualified dividend is a type of dividend payment that meets specific criteria set by the Internal Revenue… Taxation

R

View all 29 terms →
Rollover A rollover is the process of moving assets from one retirement account to another without triggering taxes or… Retirement Planning Russell 2000 The Russell 2000 is a stock market index that tracks the performance of roughly 2,000 of the smallest… Stocks & Equity Markets Return on equity (ROE) Return on Equity (ROE) is a powerful financial ratio that measures a company’s profitability by revealing how much… Financial Ratios & Analysis

S

View all 39 terms →
Securities Act of 1933 The Securities Act of 1933 is a landmark piece of federal legislation enacted in the United States in… Financial Regulation Share class C Share class C is a type of mutual fund share class that typically charges a level load, meaning… Mutual Funds, ETFs & Pooled Vehicles Share class (Class A/B/C) Share class (Class A/B/C) refers to different categories of shares offered by a mutual fund, each with its… Stocks & Equity Markets

T

View all 23 terms →
Treasury notes Treasury notes, often called T-notes, are debt securities issued by the U.S. Department of the Treasury. They are… Bonds & Fixed Income Treasury Inflation-Protected Securities (TIPS) TIPS stands for Treasury Inflation-Protected Securities. These are a special type of Treasury bond issued by the U.S.… Bonds & Fixed Income Total return Total return is a comprehensive measure of an investment’s performance that captures all sources of value change over… Investing Fundamentals

U

View all 6 terms →
Unsecured debt Unsecured debt is a type of loan or credit that is not backed by any form of collateral.… Credit, Debt & Lending Umbrella policy An umbrella policy, also known as personal umbrella insurance, is an extra layer of liability insurance that goes… Insurance & Risk Protection Universal life insurance Universal life insurance is a type of permanent life insurance that offers flexible premiums, adjustable death benefits, and… Insurance & Risk Protection

V

View all 7 terms →
Vesting Vesting is a legal and financial term that refers to the process by which an employee earns the… Retirement Planning VantageScore VantageScore is a credit scoring model developed by the three major credit bureaus: Equifax, Experian, and TransUnion. It… Credit, Debt & Lending Variable expenses Variable expenses are costs that change from month to month based on your consumption, choices, or needs. Unlike… Personal Finance & Money Management

W

View all 7 terms →
Withholding Withholding is the portion of an employee’s wages that an employer sends directly to the government to cover… Taxation W-2 A W-2 form, officially called the “Wage and Tax Statement,” is a crucial tax document that employers in… Personal Finance & Money Management Wire transfer A wire transfer is an electronic method of transferring funds from one person or entity to another, directly… Banking & Depository Institutions

Y

3 terms
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 Yield curve The yield curve is a graphical representation that shows the relationship between interest rates (yields) and the time… Bonds & Fixed Income

Z

2 terms
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 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