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
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 1099 A 1099 form is a series of tax documents issued by the Internal Revenue Service (IRS) and used… Taxation 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

A

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Accounts receivable Accounts receivable (AR) is the money owed to a business by its customers for goods or services that… Financial Statements & Accounting Asset class An asset class is a group of investments that share similar characteristics, behave similarly in the marketplace, and… Investing Fundamentals ACH transfer An ACH transfer is an electronic transfer of money between bank accounts through the Automated Clearing House (ACH)… Banking & Depository Institutions

B

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Broker A broker is an individual or firm that acts as an intermediary between buyers and sellers in financial… Financial Markets & Market Mechanics Blue chip Blue chip stocks are shares of large, well-established, and financially sound companies that have a long history of… Stocks & Equity Markets Below-the-line deduction A below-the-line deduction is an expense that you can subtract from your adjusted gross income (AGI) to reduce… Taxation

C

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Clearing house A clearing house (also known as a central counterparty or CCP) is a financial institution that acts as… Financial Markets & Market Mechanics Core inflation Core inflation is a measure of inflation that excludes the prices of food and energy. These categories are… Economics for Finance Collections Collections refers to the process that debt lenders and creditors use to recover overdue payments from borrowers who… Credit, Debt & Lending

D

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Dow Jones Industrial Average The Dow Jones Industrial Average (DJIA), often simply called “the Dow,” is one of the oldest and most… Stocks & Equity Markets Dividend payout ratio The dividend payout ratio is a financial metric that measures the proportion of a company’s earnings distributed to… Financial Ratios & Analysis Dollar-cost averaging Dollar-cost averaging (DCA) is an investment strategy where a fixed dollar amount of a particular asset—such as shares… Investing Fundamentals

E

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Exchange An exchange is a regulated marketplace where buyers and sellers come together to trade financial instruments such as… Financial Markets & Market Mechanics Enterprise value (EV) Enterprise Value (EV) is a comprehensive measure of a company’s total value, often used as a more complete… Financial Ratios & Analysis Equity Equity, also known as shareholder’s equity or owner’s equity, represents the residual interest in the assets of an… Financial Statements & Accounting

F

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Fiduciary duty Fiduciary duty is a legal obligation that requires one party, known as the fiduciary, to act solely in… Financial Regulation Free cash flow (FCF) Free cash flow (FCF) is the cash a company generates after spending the money required to maintain or… Corporate Finance Fund of funds A fund of funds (FOF) is a pooled investment vehicle that invests in a portfolio of other funds… Mutual Funds, ETFs & Pooled Vehicles

G

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Growth stock A growth stock is a share in a company that is expected to grow at an above-average rate… Stocks & Equity Markets 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 GAAP GAAP (Generally Accepted Accounting Principles) is a common set of accounting rules, standards, and procedures that companies in… Financial Statements & Accounting

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 Homeowners insurance Homeowners insurance is a type of property insurance that protects an individual’s home and personal belongings against damage,… Insurance & Risk Protection Home equity loan A home equity loan is a type of second mortgage that allows homeowners to borrow money using the… Real Estate & Mortgage Finance

I

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Internal rate of return (IRR) The Internal Rate of Return (IRR) is a powerful financial metric used to evaluate the profitability of potential… Corporate Finance Inventory turnover Inventory turnover is a key financial ratio that measures how many times a company sells and replaces its… Financial Ratios & Analysis 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

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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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 Limit order A limit order is a type of order to buy or sell a security at a specific price… Financial Markets & Market Mechanics

M

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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 Money market account A money market account (MMA) is a type of deposit account offered by banks and credit unions that… Banking & Depository Institutions Modified adjusted gross income (MAGI) Modified Adjusted Gross Income (MAGI) is a critical calculation used by the Internal Revenue Service (IRS) to determine… Taxation

N

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Non-discretionary spending Non-discretionary spending, also called essential or mandatory spending, refers to expenses that are necessary for basic living and… Personal Finance & Money Management 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 Net margin Net margin, also known as net profit margin, is a key profitability ratio that measures how much of… Financial Ratios & Analysis

O

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OCC (Office of the Comptroller of the Currency) The Office of the Comptroller of the Currency (OCC) is an independent bureau within the U.S. Department of… Financial Regulation Operating income Operating income, also known as operating profit or operating earnings, measures the profit a company makes from its… Financial Statements & Accounting Out-of-pocket maximum The out-of-pocket maximum is the most money you will have to pay for covered healthcare services in a… Insurance & Risk Protection

P

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Profitability index The profitability index (PI) is a financial metric used in capital budgeting to evaluate the attractiveness of an… Corporate Finance Principal and interest (P&I) Principal and interest (P&I) is the core component of a mortgage payment that goes directly toward paying down… Real Estate & Mortgage Finance Points (discount points) Discount points, often simply called “points,” are a form of prepaid interest you can pay to your lender… Real Estate & Mortgage Finance

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 Quantitative tightening (QT) Quantitative tightening (QT) is a contractionary monetary policy tool used by a central bank, like the Federal Reserve,… Monetary & Fiscal Policy Qualified plan A qualified plan is a retirement savings plan that meets the requirements of the Internal Revenue Code (IRC)… Retirement Planning

R

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Refinancing Refinancing is the process of replacing an existing loan (usually a mortgage) with a new loan that has… Real Estate & Mortgage Finance Rebalancing Rebalancing is the process of realigning the weightings of a portfolio of assets by periodically buying or selling… Investing Fundamentals Retained earnings Retained earnings represent the cumulative portion of a company’s net income that is not distributed to shareholders as… Financial Statements & Accounting

S

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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 Statement of stockholders’ equity The Statement of Stockholders’ Equity is a financial report that explains how a company’s equity changes over a… Financial Statements & Accounting

T

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Target-date fund A target-date fund is a type of mutual fund or exchange-traded fund designed to simplify retirement investing for… Mutual Funds, ETFs & Pooled Vehicles Trade deficit A trade deficit occurs when a country imports more goods and services than it exports over a given… Economics for Finance Trade-off theory The trade-off theory is a core concept in corporate finance that explains how companies decide on their mix… Corporate Finance

U

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Umbrella policy An umbrella policy, also known as personal umbrella insurance, is an extra layer of liability insurance that goes… Insurance & Risk Protection Underwater mortgage An underwater mortgage, also known as being in a state of negative equity, occurs when the outstanding balance… Real Estate & Mortgage Finance Underwriting Underwriting is the process by which a lender, insurer, or investment bank evaluates the risk involved in a… Insurance & Risk Protection

V

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Variable annuity A variable annuity is a type of insurance contract that offers a way to save for retirement by… Retirement Planning Vesting Vesting is a legal and financial term that refers to the process by which an employee earns the… Retirement Planning Volatility Volatility is a statistical measure of the dispersion of returns for a given security or market index. In… Investing Fundamentals

W

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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 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 Wash-sale rule The wash-sale rule is a regulation by the Internal Revenue Service (IRS) that prevents investors from claiming a… Taxation

Y

3 terms
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 Yield Yield is a financial term that measures the income generated by an investment, typically expressed as a percentage… Investing Fundamentals

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