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
401(k) A 401(k) is a tax-advantaged retirement savings plan sponsored by an employer. It allows employees to save and… 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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Asset class An asset class is a group of investments that share similar characteristics, behave similarly in the marketplace, and… Investing Fundamentals Accredited investor An accredited investor is an individual or entity that meets specific financial criteria established by the Securities and… Financial Regulation Accrued interest Accrued interest is the interest that has accumulated on a bond or other fixed-income security since the last… Bonds & Fixed Income

B

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Back-end load A back-end load is a fee that investors pay when they sell or redeem shares in certain types… Mutual Funds, ETFs & Pooled Vehicles Backdoor Roth A Backdoor Roth is a legal strategy that allows high-income earners to contribute to a Roth IRA, even… Retirement Planning Beige Book The Beige Book, formally known as the Summary of Commentary on Current Economic Conditions by Federal Reserve District,… Monetary & Fiscal Policy

C

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Credit rating – S&P A credit rating from S&P (Standard & Poor’s) is an opinion about the creditworthiness of a borrower, such… Bonds & Fixed Income Credit, Debt & Lending Cash value Cash value is a feature of permanent life insurance policies, such as whole life insurance and universal life… Insurance & Risk Protection CFTC The CFTC, or Commodity Futures Trading Commission, is an independent federal agency in the United States responsible for… Financial Regulation

D

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Depreciation Depreciation is a fundamental accounting concept that allocates the cost of a tangible asset over its useful life.… Financial Statements & Accounting Direct deposit Direct deposit is an electronic payment method that transfers funds directly from a payer’s bank account into the… Personal Finance & Money Management Debit card A debit card is a payment card issued by a bank or credit union that allows you to… Banking & Depository Institutions

E

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EV/EBITDA The EV/EBITDA ratio is a valuation multiple that compares a company’s enterprise value (EV) to its earnings before… Financial Ratios & Analysis Exchange An exchange is a regulated marketplace where buyers and sellers come together to trade financial instruments such as… Financial Markets & Market Mechanics Estimated tax Estimated tax is a method of paying taxes on income that is not subject to withholding. Instead of… Taxation

F

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Federal funds rate The federal funds rate is the interest rate at which depository institutions (such as banks and credit unions)… Monetary & Fiscal Policy Financial Industry Regulatory Authority (FINRA) The Financial Industry Regulatory Authority (FINRA) is a private, non-profit organization that acts as a self-regulatory organization (SRO)… Financial Regulation Financial goal setting Financial goal setting is the process of defining clear, specific objectives for your money, creating a plan to… Personal Finance & Money Management

G

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Gross margin Gross margin is a key financial metric that shows how efficiently a company produces and sells its products.… Financial Ratios & Analysis Gross profit Gross profit is the profit a company makes after deducting the costs directly tied to producing and selling… 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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Hurdle rate The hurdle rate is the minimum acceptable rate of return on an investment or project that a company… Corporate Finance 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

I

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Inventory turnover Inventory turnover is a key financial ratio that measures how many times a company sells and replaces its… Financial Ratios & Analysis Interest coverage The interest coverage ratio (also known as times interest earned) is a financial metric that measures a company’s… Financial Ratios & Analysis Interest rate An interest rate is the cost of borrowing money or the return earned on savings, expressed as a…

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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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 Long-term capital gains Long-term capital gains are the profits you earn from selling an asset that you have held for more… Taxation Loan origination fee A loan origination fee is an upfront charge imposed by a lender to process, underwrite, and fund a… Credit, Debt & Lending

M

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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 Market capitalization Market capitalization (or “market cap”) is the total dollar value of a publicly traded company’s outstanding shares of… Stocks & Equity Markets Maturity In the world of bonds, maturity is the predetermined date on which the issuer must repay the bond’s… Bonds & Fixed Income

N

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Nominal GDP Nominal Gross Domestic Product (GDP) is a measure of the total value of all final goods and services… Economics for Finance NCUA insurance NCUA insurance refers to the deposit insurance coverage provided by the National Credit Union Administration (NCUA) to members… Banking & Depository Institutions National debt The national debt is the total amount of money that a country’s federal government has borrowed and has… Monetary & Fiscal Policy

O

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Open-end fund An open-end fund is a type of mutual fund that can issue an unlimited number of shares. The… Mutual Funds, ETFs & Pooled Vehicles 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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Pension A pension is a type of retirement plan that promises to pay a regular, fixed income to employees… Retirement Planning Prospectus A prospectus is a formal legal document that describes a security offering for sale to the public. It… Mutual Funds, ETFs & Pooled Vehicles 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

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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 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 Quantitative tightening (QT) Quantitative tightening (QT) is a contractionary monetary policy tool used by a central bank, like the Federal Reserve,… Monetary & Fiscal Policy

R

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Rebalancing Rebalancing is the process of realigning the weightings of a portfolio of assets by periodically buying or selling… Investing Fundamentals Reserve requirement The reserve requirement is a central banking regulation that sets the minimum fraction of customer deposits and liabilities… Monetary & Fiscal Policy Rider A rider is an amendment or attachment to an insurance policy that modifies the standard terms, coverage, or… Insurance & Risk Protection

S

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Sinking fund A sinking fund is a strategic financial tool used by individuals, corporations, and governments to set aside money… Personal Finance & Money Management Security A security is a tradable financial instrument that holds monetary value and represents ownership, a creditor relationship, or… Investing Fundamentals 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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Trade deficit A trade deficit occurs when a country imports more goods and services than it exports over a given… Economics for Finance Truth in Lending Act (TILA) The Truth in Lending Act (TILA) is a landmark federal law enacted in 1968 as part of the… Credit, Debt & Lending 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

U

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Unsecured debt Unsecured debt is a type of loan or credit that is not backed by any form of collateral.… Credit, Debt & Lending Underwriting Underwriting is the process by which a lender, insurer, or investment bank evaluates the risk involved in a… 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

V

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Value stock A value stock is a share of a company that trades at a lower price relative to its… Stocks & Equity Markets VantageScore VantageScore is a credit scoring model developed by the three major credit bureaus: Equifax, Experian, and TransUnion. It… Credit, Debt & Lending 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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Wash-sale rule The wash-sale rule is a regulation by the Internal Revenue Service (IRS) that prevents investors from claiming a… Taxation 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 Working capital Working capital is a financial metric that represents the difference between a company’s current assets and current liabilities.… Corporate Finance

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