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
1099 A 1099 form is a series of tax documents issued by the Internal Revenue Service (IRS) and used… Taxation 457 plan A 457 plan is a type of tax-advantaged retirement savings account offered to employees of state and local… 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

A

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Assets Assets are economic resources that a business or individual owns or controls, expected to produce future benefits. In… Financial Statements & Accounting Agency bond An agency bond is a debt security issued by a government-sponsored enterprise (GSE) or a federal government agency.… Bonds & Fixed Income 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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Benchmark A benchmark is a standard or point of reference against which the performance of an investment, portfolio, or… Investing Fundamentals Bankruptcy – Chapter 11 Bankruptcy – Chapter 11 is a legal process for businesses (and sometimes individuals with high levels of debt)… Credit, Debt & Lending Beta Beta (β) is a measure of a stock’s volatility relative to the overall market. It is a key… Corporate Finance Stocks & Equity Markets

C

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Common stock Common stock is a type of ownership in a corporation. When you buy a share of common stock,… Stocks & Equity Markets Callable bond A callable bond is a type of bond that gives the issuer the right, but not the obligation,… Bonds & Fixed Income Cash flow statement A cash flow statement is one of the three core financial statements used to evaluate a company’s financial… Financial Statements & Accounting

D

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Delinquency Delinquency is a term used in credit and lending to describe a situation where a borrower fails to… Credit, Debt & Lending Debt Debt is a financial obligation that occurs when one party borrows money from another. The borrower receives a… Credit, Debt & Lending Investing Fundamentals Deferred annuity A deferred annuity is a type of retirement savings contract offered by insurance companies. With a deferred annuity,… Retirement Planning

E

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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 Expected return Expected return is a key concept in investing that represents the average amount of profit or loss an… Investing Fundamentals Estate tax The estate tax is a federal tax imposed on the transfer of a deceased person’s assets to their… Taxation

F

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FDIC insurance The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States government that protects depositors… Banking & Depository Institutions Foreclosure Foreclosure is the legal process that occurs when a homeowner fails to make their mortgage payments, leading the… Real Estate & Mortgage Finance 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

G

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GAAP GAAP (Generally Accepted Accounting Principles) is a common set of accounting rules, standards, and procedures that companies in… Financial Statements & Accounting Gift tax The gift tax is a federal tax in the United States imposed on the transfer of property or… Taxation Gross income Gross income is the total amount of money you earn from all sources before any deductions or taxes… Personal Finance & Money Management

H

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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 HSA (Health Savings Account) An HSA, or Health Savings Account, is a tax-advantaged savings account that you can use to pay for… Insurance & Risk Protection

I

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Inflation-adjusted income Inflation-adjusted income, also called real income, is a measure of how much your purchasing power has changed after… Personal Finance & Money Management Interest coverage The interest coverage ratio (also known as times interest earned) is a financial metric that measures a company’s… Financial Ratios & Analysis Income (investment) Investment income is money you earn from your investments without having to work for it actively. Instead of… Investing Fundamentals

J

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

L

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Leverage Leverage is the strategic use of borrowed capital (debt) to increase the potential return on an investment. In… Corporate Finance 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 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

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Minimum payment The minimum payment is the smallest amount you must pay each month on a credit card or other… Credit, Debt & Lending Mutual fund A mutual fund is a type of investment vehicle that pools money from many investors to purchase a… Mutual Funds, ETFs & Pooled Vehicles Marginal tax rate The marginal tax rate is the percentage of tax applied to your last dollar of income. In a… Taxation

N

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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 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 Net income Net income is the bottom line of a company’s income statement. It represents the total profit a business… Financial Statements & Accounting

O

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Opportunity cost Opportunity cost is the value of the next best alternative that you give up when you make a… Economics for Finance Over-the-counter (OTC) Over-the-counter (OTC) trading refers to a decentralized market where financial instruments are traded directly between two parties, without… Financial Markets & Market Mechanics Ordinary dividend An ordinary dividend is a type of payment that a corporation makes to its shareholders from its profits,… Taxation

P

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PCAOB The PCAOB (Public Company Accounting Oversight Board) is a nonprofit corporation established by the Sarbanes-Oxley Act of 2002.… Financial Regulation Premium/discount to NAV Premium/discount to Net Asset Value (NAV) is a concept that applies primarily to closed-end funds and exchange-traded funds… Mutual Funds, ETFs & Pooled Vehicles Passive investing Passive investing is a long-term investment strategy that aims to match the performance of a broad market index,… Investing Fundamentals

Q

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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 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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Roth IRA A Roth IRA (Individual Retirement Account) is a powerful retirement savings vehicle that offers tax-free growth and tax-free… Retirement Planning 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 Return on invested capital (ROIC) Return on Invested Capital (ROIC) is a key financial metric that shows how well a company turns the… Financial Ratios & Analysis

S

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SEP-IRA A SEP-IRA, or Simplified Employee Pension Individual Retirement Arrangement, is a retirement savings plan designed for self-employed individuals… Retirement Planning 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 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

T

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Title insurance Title insurance is a specialized form of indemnity insurance that protects real estate buyers and lenders against financial… Real Estate & Mortgage Finance Time value of money The time value of money (TVM) is a core concept in finance that describes how a sum of… Investing Fundamentals Trade deficit A trade deficit occurs when a country imports more goods and services than it exports over a given… Economics for Finance

U

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Universal life insurance Universal life insurance is a type of permanent life insurance that offers flexible premiums, adjustable death benefits, and… Insurance & Risk Protection Umbrella policy An umbrella policy, also known as personal umbrella insurance, is an extra layer of liability insurance that goes… Insurance & Risk Protection 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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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 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

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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 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 Withholding Withholding is the portion of an employee’s wages that an employer sends directly to the government to cover… Taxation

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-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