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 12b-1 fee A 12b-1 fee is an annual fee charged by some mutual funds to cover the costs of marketing,… Mutual Funds, ETFs & Pooled Vehicles 1099 A 1099 form is a series of tax documents issued by the Internal Revenue Service (IRS) and used… Taxation

A

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Adjusted gross income (AGI) Adjusted Gross Income (AGI) is a key number used in the United States tax system. It represents your… Taxation Assets Assets are economic resources that a business or individual owns or controls, expected to produce future benefits. In… Financial Statements & Accounting APY APY, which stands for Annual Percentage Yield, is a financial term that shows the real rate of return… Banking & Depository Institutions

B

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Bond A bond is a fixed-income financial instrument that represents a loan made by an investor to a borrower,… Bonds & Fixed Income 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 Beneficiary A beneficiary is a person, organization, trust, or estate that is legally designated to receive assets or benefits… Insurance & Risk Protection

C

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Credit rating – Moody’s Moody’s Investors Service, commonly known as Moody’s, is one of the “Big Three” credit rating agencies alongside S&P… Bonds & Fixed Income Closing costs Closing costs are the fees and expenses paid by homebuyers and sellers at the end of a real… Real Estate & Mortgage Finance Callable bond A callable bond is a type of bond that gives the issuer the right, but not the obligation,… Bonds & Fixed Income

D

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Debt financing Debt financing is a method businesses use to raise money by borrowing funds from lenders, with a promise… Corporate Finance Deflation Deflation is a general decline in prices for goods and services, occurring when the inflation rate falls below… Economics for Finance Debt-to-equity The debt-to-equity (D/E) ratio is a key leverage ratio that compares a company’s total liabilities to its shareholder… Financial Ratios & Analysis

E

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Early withdrawal penalty An early withdrawal penalty is a fee imposed by the Internal Revenue Service (IRS) when you take money… Retirement Planning 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 Expansion Expansion is a phase of the business cycle where the economy grows for two or more consecutive quarters.… Economics for Finance

F

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Fixed annuity A fixed annuity is a type of insurance contract designed to provide a guaranteed, steady stream of income,… Retirement Planning Financial literacy Financial literacy is the ability to understand and effectively use various financial skills, including personal financial management, budgeting,… Personal Finance & Money Management Fixed expenses Fixed expenses are costs that remain the same amount each month and are essential for your basic living… Personal Finance & Money Management

G

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Gift tax The gift tax is a federal tax in the United States imposed on the transfer of property or… Taxation Growth stock A growth stock is a share in a company that is expected to grow at an above-average rate… Stocks & Equity Markets 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 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 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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IRS Form 1040 IRS Form 1040, officially titled the “U.S. Individual Income Tax Return,” is the standard federal income tax form… Taxation 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 Investment Company Act of 1940 The Investment Company Act of 1940 is a landmark piece of U.S. federal legislation that created a comprehensive… Financial Regulation

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-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 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 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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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 – M3 Money supply M3 is a broad measure of the total amount of money circulating in an economy. It… Monetary & Fiscal Policy Market maker A market maker is a financial firm or individual that continuously quotes both a buy (bid) and sell… Financial Markets & Market Mechanics

N

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Nominal return Nominal return is the percentage gain or loss on an investment before adjusting for the effects of inflation.… Investing Fundamentals National debt The national debt is the total amount of money that a country’s federal government has borrowed and has… Monetary & Fiscal Policy NCUA The NCUA, or National Credit Union Administration, is an independent federal agency created by the United States Congress… Financial Regulation

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 Open market operations Open market operations (OMO) are the primary tool used by the Federal Reserve System to influence the supply… Monetary & Fiscal Policy Operating income Operating income, also known as operating profit or operating earnings, measures the profit a company makes from its… Financial Statements & Accounting

P

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Policy limit A policy limit is the maximum amount an insurance company will pay for a covered loss under an… Insurance & Risk Protection Price-to-sales (P/S) The Price-to-Sales (P/S) ratio is a valuation metric that compares a company’s stock price to its revenue per… Financial Ratios & Analysis Pre-approval Pre-approval is a preliminary evaluation by a lender that indicates how much money you may be able to… Real Estate & Mortgage Finance

Q

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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 Quantitative easing (QE) Quantitative easing (QE) is an unconventional monetary policy tool used by a central bank — like the U.S.… Monetary & Fiscal Policy

R

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Regulation Best Interest (Reg BI) The Regulation Best Interest (Reg BI) is a rule established by the U.S. Securities and Exchange Commission (SEC)… Financial Regulation 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 Russell 2000 The Russell 2000 is a stock market index that tracks the performance of roughly 2,000 of the smallest… Stocks & Equity Markets

S

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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 Securities and Exchange Commission (SEC) The Securities and Exchange Commission (SEC) is the primary federal agency responsible for enforcing federal securities laws, regulating… Financial Regulation Security A security is a tradable financial instrument that holds monetary value and represents ownership, a creditor relationship, or… Investing Fundamentals

T

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Treasury bonds Treasury bonds (often called T-bonds) are long-term debt securities issued by the U.S. Department of the Treasury to… Bonds & Fixed Income Trade-off theory The trade-off theory is a core concept in corporate finance that explains how companies decide on their mix… Corporate 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

U

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Underwater mortgage An underwater mortgage, also known as being in a state of negative equity, occurs when the outstanding balance… Real Estate & Mortgage Finance Unemployment rate The unemployment rate is a key economic indicator that measures the percentage of the labor force that is… Economics for Finance 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

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Variable expenses Variable expenses are costs that change from month to month based on your consumption, choices, or needs. Unlike… Personal Finance & Money Management VantageScore VantageScore is a credit scoring model developed by the three major credit bureaus: Equifax, Experian, and TransUnion. It… Credit, Debt & Lending 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 Working capital Working capital is a financial metric that represents the difference between a company’s current assets and current liabilities.… Corporate Finance 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 curve The yield curve is a graphical representation that shows the relationship between interest rates (yields) and the time… Bonds & Fixed Income 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