Glossary

# | A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

# | A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z

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10-KAn SEC required comprehensive financial performance report filed annually by public companies.
10-QAn SEC required comprehensive financial performance report filed quarterly by public companies.
10-Year Treasury NoteA United States debt obligation with a 10 year maturity upon initial issuance.
100% Equities StrategyA portfolio containing soley equities.
12B-1 FeeA fee on mutual funds that covers annual marketing and distributions.
30-Year TreasuryA United States debt obligation with a 30 year maturity upon initial issuance.
401(k)A qualified investment vehicle offered by employers to employees that allows for tax deferred growth.
403(b)A qualified investment vehicle offereed to employees of tax-exempt organizations and public schools that allows for tax deferred growth.
501(c)(3)A nonprofit or charitable organization.
52-Week High/LowThehighest and lowest price a stock has traded at during the past 52 weeks or 1 year.
52-Week RangeThe two data points within the range is the highest and lowest price a stock has traded at during the past 52 weeks or 1 year.
529 Savings PlanTax-advantaged investment vehicle to save for future educational costs.
8-KPublic companies report unscheduled material changes that are of importance to shareholders or SEC.

A

AARPA nonprofit founded in 1958, for people age 50+.
Absolute ReturnShown as a percentage, this is the return achieved over a time period.
Account BalanceThe quantity of funds held with a financial institution.
Account NumberUnique numbered code given to an account holder.
Accredited InvestorTrusts, Insurance companies, Banks, High New Worth Investors, and brokers who may deal in securities that might not be registed with financial authorities.
Acid-Test RatioThe ratio determines if a balance sheet has enough short term assets to pay for its short term liabilities.
Active ManagementThe oposite of Index Management. Uses manager(s) to activey manage the capital within a portfolio.
Activist InvestorIn attempt to gain a seat at the table of a public companies board of director, one attempts to purchase large quantities of the companies shares.
Actuarial Life TableStatisitical table to show the probablility of a person at a specific age dying before their next upcoming birthday.
After-Hours TradingStock trading that happens either before or after the trading day of a stock exchange.
Algorithmic TradingWith human oversight, computers execute orders based on programmed algorithmic trading istructions.
AlphaAlpha is the active risk-adjusted return on an investment comparable to an aggregate market and is used to describe a fund manager's skill level. Alpha = Investment Return - (Risk Free Rate + (Market Return - Risk Free Rate) * Beta of Investment
Alternative InvestmentTypicall this includes Venture Capital, Hedge Funds. Tangible Assets, Commodities and physical property.
American Stock Exchange (AMEX)Now refered to as the NYSE American
Annual ReportPublicly traded companies report their financial conditions and operation tacticts to shareholders annually.
Annual TurnoverUseful for investors to see how actively the money in an ETF, Mutual Fund, or Portfolio is managed.
AnnualizeTaking a percentage gain/loss and multiple by the periods needed to be equal to 1 year.
AnnuityA contract that provides income for a specified period of years upon annuitization.
AMLAnti-Money Laundering - Required by banks and financial institutions to ensure customers are not money laundering.
AntitrustLaws and regulations to ensure there is no price-fixing, mergers that stop competition in certain markets, and prevent monopolies.
AppreciationIncrease in an assets prive over time.
ArbitrageBuying an asset or security from one market and selling it simultaneously in another for a larger price to profit.
Arithmetic MeanThe simplest form of finding the average. Total sum of a series of numbers divided by quantity of number series.
Articles of IncorporationBinding, legal documents filed with the government to create a corporation.
AIArtificial Intelligence. A computer that is designed to act, think and behave like a human.
Ascending ChannelUsed in technical analysis, this is the price action of a security that sets higher lows and higher highs between upward sloping parallel lines.
AskWhat a seller of a security is willing to sell at. Commonmly known as "Offer Price."
AssetA resource controlled by an entity from which future economic benefits are expected.
Asset AllocationAn Investment strategy that invests equities, fixed income, and cash based on an investors risk tolerance, goals, and time horizon.
Asset ClassDescribes the different groups of financial instruments available to invest in. These groups include equities (stocks), fixed income (bonds), cash or cash equivalents (money market instruments), real estate, commodities, futures, and other derivatives.
Asset ManagementA financial institution managing part or in entirety a clients portfolio.
Assets Under Management (AUM)Describes the investable assets managed by a financial instituiton.
AARAverage Annual Return.
Average Cost Basis MethodThe sum of money invested into a position or fund divided by the total number of shares owned.
Average Daily Trading Volume - ADTVSum of the number of shares that are traded divided by the number of days.
Average ReturnSum of returns divided by the number of returns.

B

BacktestingTests an invemtent strategy using historical data for viability.
BailoutThis is when money and or resources are provided by a government, individual, or business into a failiing company and or industry.
Balance SheetA financial statement reporting a company or indivuals assets, liabilites, and equity at a certain point in time.
Balanced FundA single portfolio containing both stocks and bonds.
Bank ReservesMinimum cash amounts a financial institution must keep on hand as required by central bank requirements.
Basis Point (BPS)A unit of measurement for interest rates and percentages in finance (1 BPS = 0.01%).
BenchmarkA broad market that performance of a security of portfolio can measure performance against.
Berkshire HathawayHolding company run by Warren Buffett.
BetaA common measure of systematic risk, or volatility used in CAPM (Capital Asset Pricing Model).
BidAn offer in effort to buy a security, currency or commodity by an investor, dealer, or trader.
Bid-Ask SpreadThe quantity the ask price ecxeeds the bid price for a security, currency, or commodity in the market.
Bid SizeExplains the quantity of shares of a security, currency or commodity that the investor, dealor or trader is willing to purchase at a specific bid price.
Black FridayRefers to the historic day of 9/24/1869 when markets and gold plummented.
Black MondayRefers to the historic day of 10/19/1987 where the Dow Jones lost nearly 22% during the trading day.
Black Scholes ModelA mathematical model to price options contracts.
Block TradeThe purchase or sale of a large quantity of securities.
Blue ChipRefers to a corporation that is well known nationally and financially sound.
Board of DirectorsRefers to elected group of people who represent shareholders as a whole.
BondIs also known as fixed income, and is where the investor loans money to a borrower (commonly governments or corporations).
Bond ETFIs an Exchange Traded Fund that invests soley in bonds.
Bond LatterA portoflio of bonds or other fixed income securities with varying maturity dates.
Bond YieldWhat an investor realizes as return on a bond.
BondholderThe investor who owns the debt secuirty of a government or corporation.

C

C-SuiteCollection of officers of a business organization that have the word "chief" in their title.
Call OptionA contract between a buyer and seller where a security is exchanged at a predetermined time and price (strike). For american style call options the buyer has the right to exercise the option at the current market price at any time prior to the contract expiration.
CapitalRefers to financial assets which describes funds used for financing or funds held in deposit.
CAPMCapital Asset Pricing Model
CapitalismAn economic system where prices, production, and the distribution of goods, are privately owned and are determined by the supply and demand of the free market economy.
Cash DividendCash paid to the shareholders of an organization for their investment shares based on current earnings.
CFPCertified Fianncial Planner
CCOChief Compliance Officer
CEOChief Executive Officer
CFOChief Financial Officer
COOChief Operating Officer
CTOChief Technology Officer
Chinese WallA way to prevent the spread of information between departments that may lead to a conflict of interest.
ChurningAn unethical and illegal practice which consists of a broker making excessive trades on a client's account in order to drive up their own commission.
Clearing HouseMiddle man between buyers and sellers of securities to ensure settlement is smooth.
Close-End FundA limited number of shares issued at IPO, this portfolio of pooled assets is listed for trade on a stock exchange.
CBOEChicago Board Options Exchange. The worlds largest options market.
CollateralAn asset pledged to by a borrower to a lender in return for a loan which may be seized if the borrower defaults on the obligation.
CommodityA product that can be traded, bought, or sold on some type of exchange.
Common StockShares of ownership of a corporation.
Compliance OfficerOfficer responsible for ensuring that the company is following both external regulations and internal bylaws.
CAGRCompound Annualized Growth Rate
Compound InterestDeterminded by interest accrued on the initial balance and including accumulated interest from past periods.
CPIConsumer Price Index
Convertible BondA type of bond that yields interest but can be converted into common stock.
Convertible Preferred StockA type of stock that allows the holder to convert shares into common stock after a predetermined date.
Cost BasisAlso known as the purchase price.
Coverage RatioInforms investors on the likelyhood of a company being able to pay interest payments and dividends.
Credit RiskThe posibility of a borrower not being able to repay the loan and causing a loss for the lender.
Crude OilUnferined petroleum which is then commonly refined into various types of fuel.
CryptocurrencyA new form of digitial asset.
CurrencyA medium of exchange for goods and/or services.
Current AssetsWithin 1 year, all assets that a company will use or sell.
Current LiabilitiesWithin 1 year, all financial obligations that are coming due.
Current RatioCurrent assets divided by current liabilities.
Current YieldAnnueal income divided by current price.
CUSIP NumberSimilar to how a social security number is given to humans, stocks get a unique identification number assigned to them.
Custodial AccountA financial account that an adult controls on behalf of a minor until the minor hits a certain age.
CustodianA financial institution that holds client money in attempt to minimize theft or loss.
CRMCustomer Relationship Management

D

Day OrderA type order that is opened and closed within on trading day.
Day TraderA type of trader who opens and closes a position within one trading day.
Dead Cat BounceA temporary increase of an assets price during a bear market/long decline.
DealerA firm that cna buy/sell securities for their own accounts.
Death CrossAppearing on a chart, this is when a short term moving average downward crosses a long term moving average.
Debt/EBITDA RatioDebt divided by EBITDA.
Debt RatioTotal debt divided by total assets.
D/E RatioDebt-to-equity ratio = total liabilities divided by total shareholders equity.
Default RiskThe chance a company or person wont be able to make debt payments.
Defensive StockA stock that provides a solid dividend and stable earnings during any type of market condition.
DemandA consumers desire to purchase.
Discount BondA type of bond that doesn't issue coupon payments but instead is sold at a discount to par value and then is redeemed at par value at maturity.
DCFDiscounted Cash Flow
Disposable IncomePersonal income minue personal taxes.
DivergenceWhen the price of an assets or price of an asset and a technicla indicator are moving in opposite directions.
DiversificationHolding a mix of asset types in a portfolio as a risk management strategy.
DividendPayment made out of a firm's earnings to its owners in the form of either cash or stock.
DDMDividend Discount Model
Dividend Growth RateThe annualized percentage growth that a stocks dividend increases.
DPSDividend Per Share
Dividend RateEqual to the total amount of dividend payments received annually.
DRIPDividend Reinvestment Plan
Dividend YieldRefers to the total dividend per share divided by the current share price.
DojiA candlestick trading pattern that is shown on a chart as having a bearish wick, a bullish wick, and no body. These patterns are formed by the price in a candle's timeframe moving up and down from the open and closing at the price where the candle opened. These patterns can typically show a reversal in price action.
DCADollar Cost Average.
Dotcom BubbleStock market bubble growth in the late 1990's caused by excessive speculation in internet related companies with the wide spread use of the internet.
Double BottomForms on a chart and is a bullish technical pattern where a price low hits two consecutive times with a moderate increase between the lows.
Doublte TopForms on a chart and is a bearish technical pattern where a price high hits two consecutive times with a minimal decline between the highs.
DJIADow Jones industrial Average. A benchmark index.
DrawdownTop to bottom decline for a specified time period.
DumpingSelling a product in a foriegn country for less than the price in the domestic country.

E

E-MiniFracational in value of a standard futures contract and electronically traded.
Early AdopterA person or business who is early on a trend, technology or product before others use it.
EarningsBottom line of a company. Profits.
EBITEarnings Before Interest and Taxes.
EBITDAEarnings Before Interest Taxes Depreciation and Amortization.
Earnings EstimateAnalyyst's expectations for a company's future EPS/revenue.
Earnings MultiplierPrice to Earnings.
Earnings Per Share (EPS)A profitability metric used widley accros the financial indsutry as a prominent valuation indicator. EPS = (Net Income - Preferred Dividends) / (Weighted Average Shares Outstanding).
Earnings ReportReports performance of public companies.
Economic CycleFluctuations between growthe and recession within the economy.
Effective YieldBonds coupon divided by current price.
EMHEffificent Market Hypothesis
ESOPEmployee Stock Ownership Plan
ESPPEmployee Stock Purchase Plan
EndowmentDonated money to a non-profit that invests for a specific purpose; typically for generating income.
EquityOwnership in a comapny.
Equity MarketStock market.
Estate PlanningPlanning for the death of an individual and how their assets will be managed once incapacitated.
Estate TaxAs of 2019, federal taxes levied on assets of $11,400,000 when transfering an estate to heirs.
EstateNet worth of an individual.
EUEuropean Union.
Ex-DateDetermines if the buyer of a stock will recieve the dividend.
Ex-DividendBuyers of stock before the ex-dividend date recieve the next dividend payment. Buyers on or after are not.
ExpansionGrwoth period of an economic cycle.
ETFAlso known as Exchange Traded Funds, are a basket of securities traded like equities on national exchanges, typically used to mimic specific indices or sectors. These funds are the new and improved form of mutual funds as ETFs aren’t limited to being traded once a day and their management and transaction costs are minimal in comparison.
ETNExhange Traded Note

F

FAANGAcroynm for Facebook, Amazon, Apple, Netflix, Google.
Family OfficesWealth management for ultra high net worth investors.
FDIC Insured AccountFederal Deposit Insurance coporation that insures bank accounts if the bank fails.
Fear & Greed IndexCreated by CNNmoney to measure two investor emotions.
Fed Balance SheetAssets and Liabilities held by Federal Reserve.
Fed Funds RateInterest rate that banks charge eachother for lending excess cash overnight.
FOMCFederal Open Market Commitee
Federal Reserce BankU.S. central bank.
Fibonacci RetracementRefers to levels of resistance and support on a chart while doing technical analysis.
FiduciaryHighest level of legal duty owed from one party to another and requires acting in the other parties best ineterst.
FOKFill or Kill
Financial AdvisorProvides financial adivse for compensation.
Financial AnalysisEvaluating business for performance and suitability.
Financial EngineeringSolving financial problems with math.
FINRAFinancial Industry Regulatory Authority
Financial ModelingSummary of a companies assets, liabilities,and earnings to determine how future decisons and events will impact the company.
Financial Statement AnalysisUsed to understand the organizations health.
FINRA BrokercheckA free online database to help investors research financial workers and financial firms.
FIFOFirst In First Out. Accounting term.
Fiscal PolicyThe government's use of taxes and spending to promote economic growth and stability.
Fiscal YearA government or corporations's one year accounting period.
Fixed AnnuityInsurance contract with a guaranteed rate of return.
Fixed IncomeTypically government or corporate bonds that pay out fixed interest or dividends.
Floor TraderIndividual executing orders from the floor of the exchange.
Form 13FQuarterly filing by institutional investors with 100,000,000 or more AUM.
Form ADVRegistration document submitted to SEC/State authorities disclosing AUM, fee arrangements, service offerings and investment strategy.
Fortune 100Top 100 companies in the USA.
Fortune 500Top 500 companies in the USA.
Forward Dividend YieldEstimated yearly dividend as a percentage of the current stock price.
Forward P/ECurrent share price divided by estimated future earnings per share.
Fractional ShareLess than 1 full share of an quity stock.
Freddie MacProvides liquidity in the mortgage market by making the flow of money available for mortgage lenders. While Freddie Mac is a government sponsored entity, it is owned by stockholders.
FCFFree Cash Flow
Front-End LoadThe sales or comissions charged upfront when purchasing a mutual fund.
Front OfficeRefers to the part of the company in charge of meeting with clients and handling external deapartments such as marketing and sales.
Front RunningThe illegal act of purhcasing securities prior to a large, non-public transactions.
Fund ManagerThe individual responsible for conducting trades wtihin a fund portoflio.
FuturesA financial contract between a buyer and seller where the parties agree to buy/sell a security at a predetermined price at some time in the future.

G

GainA positive return on a financial instrument.
GappingRefers to when securities or indices open above or below the previous trading sessions closing price.
GAAPGenerally Accepted Accounting Principles.
Geometric MeanThe average of a data series that takes into account compounding. More widely used than arithmetic mean to caluclate investment portfolio return averages.
Gift TaxTaxes applied to money or property that is gifted to another person. Many exemptions surround this tax.
Global FundA portfolio that invests in securities located in different countries around the planet.
Global MacroAn actively managed portfolio that intends to capitalize on macroeconomic events around the world.
GlobalizationThe increasing economic integration of national economies across the world through an increase of cross-border movement of goods, services, technologies, and capital.
Goal-Based InvestingAn investment stratgegy that bases decisions off of future aims.
Going ConcernTerm explaining a company's ability to generate enough income to avoid bankruptcy.
Golden CrossRefers to a technical pattern that occurs when a security's short term daily moving average crosses above its longer term saily moving average. Example: 50-day MA crossing above the 200-day MA.
GTCGood 'Til Canceled
Government BondA debt instrument issued by a government entity.
Government ShutdownOccurs when non-essential government employees can no longer work due to lack of funding, which is typically caused when the federal budget is delayed approval.
GPUGraphics Processing Unit
Great DepressionDescribes the worst recession in the history of the modern world. This economical recession lasted 17 years, where it was kickstarted by the U.S. stock market crash in 1929 and ended after World War II in 1946.
Green InvestingAn investment stratgegy that focuses on soically responsible comapnies.
Gross IncomeIncome recieved prior to paying taxes or other deductions.
Gross MaginEqual to revenue minus cost of goods sold.
Gross ProfitIncome recieved prior to paying taxes or other deductions. Equal to revenue minus cost of goods sold.
G-7Annual monetary meeting held between the world's seven largest, most developed economies (U.S.A, France, Germany, Italy, U.K., Canada, and Japan). A.k.a "Group of Seven."
G-20Annual monetary meeting held between twenty of the world's largest, most developed economies. A.k.a "Group of Twenty."
Group Health InsuranceHealth insurace that covers an entire group, typically a company health insurance plan.
Growth InvestingAn investment strategy that focuses on equities with high PE ratios and little to no dividend payouts.
Growth StockA company with a high PE ratio and little to no dividend payouts.

H

Hang Seng Index (HSI)Index containing the aggregate of large-capitalization stocks in Hong Kong.
Hard AssetRefers to a physical asset that provides value.
Hard CurrencyCurrencies that are freely traded and accepted in international commerce.
Harmonic MeanAn average calculated by dividing total recorded observaitons by the recipocal of the numbers recorded. The reciprocal of the arithmetic mean.
Harry MarkowitzAmerican economicst best known for devloping the modern portfolio theory.
Head and Shoulders PatternA 3-part bearish price action pattern identified on a chart as an initial run and decline (first shoulder), a second run [higher than the shoulders] and decline (Head), and a third run [same as first shoulder] and decline (second shoulder).
Head of HouseholdStatus on tax reutrn; in order to qualify an individual must pay for more than half of the household expenses, be considered unmarried, and have a qualifying child or dependent.
Head TraderLead Portfolio/Fund Manager who has final decision when making trades and allocating assets.
HIPAAHealth Insurance Portability and Accountability Act.
HSAHealth Savings Account.
Healthcare SectorThe sector that comprises of public healthcare companies. Healthcare companies provide the framework of the country's healthcare and medica system.
HeatmapA type of chart that displays the size and performance of securities within a portfolio, index, or sector. The chart will show size by the surface area of the rectanlge associated with the security's ticker and the color of the rectangle represents performance (darkest red - darkest green).
Heckscher-Ohlin ModelAn economic theory that explains how countries will choose to export the goods they can most efficiently produce.
HedgeA form of secuity on a portfolio, viewed as an "insurance policy." Hedges (long and short) come in many forms, including: derivative contracts, inverse ETFs, volatility ETFs, commodities, and cash.
Hedge FundA limited partnership investing structure that utilizes leverage and other risk-on means to deliver high returns.
Hedge RatioThe ratio of the hedging instrument used compared to the asset being hedged. Hedge ratio of 1 = 100% hedged.
Held-to-MaturityRefers to holding a security the entire duration of its life.
HeuristicsMental shortcuts that help individuals simplify their decision making tasks.
High Beta IndexIndex comprising of securities with high Beta measures. Example: Russell 2000
High-Frequency Trading (HFT)Trading method utilizing powerful computers that conudct many short-term, large transaction, algorithmic trades.
High Minus Low (HML)One of three factors in the Fama-French model that explains the value premium of a portfolio.
High-Net-Worth-Individuals (HNWI)Refers to an individual with $1 million or more in liquid assets.
High-Yield BondA debt security that issues a high yield but has more credit risk associated. Also known as a junk bond.
Highly Leveraged Transaction (HLT)A transaction involving a large amount of borrowed funds.
HistogramA visual way to display continuous frequency data using bars.
Historical ReturnsPast returns of an index, portfolio, fund, or security.
Historical VolatilityPast volatility of an index, portfolio, fund, or security.
HoldNeither buying or selling a security.
Holding CompanyA type of company that has a portfolio of other companies that it owns.
Holding PeriodThe amount of time between buying and selling a security.
HoldingsRefers to the securities allocated within a portfolio or fund.
Home EquityValue that is created through an appreication in home vlaue.
Home MortgageA loan used to pay off majority of a home or property that is paid off over time with interest, using the property itself as collateral.
HIBORHong Kong Interbank Offered
Horizontal ChannelRefers to the price action of a security or index that is trading between two horizontal, parallel points.
Hostile TakeoverAn acquisition in which the target company doesn't wish to be acquired.
Hot IPOAn IPO that has gained a lot of attention from investors.
Household IncomeIncome combined from all members in a household.
Housing BubbleRefers to the mortgage bubble created prior to 2008 when high-risk mortgages were being securitized at an unprecedented rate.
HyperdeflationVery high rate of inflation, devaluing the local currency as prices of goods increase.
HyperinflationVery high rate of deflation, causing extreme decreases in prices of goods.

I

Ichimoku CloudA technical indicator used for technical analysis for trend direction, momentum, and support / resistance levels.
Idiosyncratic RiskInvestment risk specific to the industry, sector, asset class, or individual comapny.
IlliquidAn asset that cannot be easily transferred to cash.
IOC OrderImmediate or Cancel
ImpeachmentThe first step in the process for removing a high-ranking elected official from office.
In-Service WithdrawalWhen an employee takes a portion (usually the company match) or entire 401k and rolls it to an IRA penalty and tax free while still employed by the company.
ITMIn The Money
IndexMost commonly used index is the S&P 500. Intends to replicate a certain market. The S&P 500 is large cap.
Index FundA mutual fund or ETF that attempts to mimick the index.
IndicatorStatistical measurements used to evaluate trends.
IRAIndividual Retirement Account
InflationAn increase in the general price level. This means that money loses its value over time so you cannot buy as much in the future with the income you receive today.
Inheritance TaxA tax the government places on the estate of a deceased person.
IPOInitial Public Offer
Inorganic GrowthOccurs from stock buy-backs, mergers and aquisitions.
InsiderAn executive or individual privy to non-public company information.
Institutional InvestorExamples typically include insurance companies, mutual funds, and pensions that are responsible for investing money for other people.
InterestThe rate of return given to the borrower for having the privilege to borrow. Or it can mean the amount of ownership someone has within a company.
IRRInternal Rate of Return
IRSInternal Revenue Service
International InvestingUsed to increase diversification, it allows investors to spread risk into different geographies and foriegn corporations.
IoTInternet of Things
Intraday TradingTrading securities during regular business hours of the stock exchanges.
InventoryRefers to products available for sale and the materials used to produce those products.
Inverse ETFA basket of securities traded like equities on national exchanges, used to track moves inversely of index-based ETFs. These funds are typically used as hedging securities against a long portfolio. Also used for speculation purposes.
Inverse Head and ShouldersA technical pattern that forms in the price action movement of a position. It signals a bull market or when an investor would enter a long position.
InvestmentAn asset purchased to appreciate in value or earn income.
Investment Advisers Act of 1940Federal law defining responsibilites and roles of investment advisers.
Investment AdvisorFor a fee, this individual conducts research on securities and reccomends them to investors.
IARInvestment Advisor Representative
Investment AnalysisResearching investments, companies, sectors, and trends.
IBInvestment Bank
Investment CompanyCorporation that pools capital from investors and invests the pooled capital into investments.
investment Company Act of 1940The federal law that regualtes investment comapnies.
Investment HorizonThe time fram that an investor expects to hold the investments.
Investment IncomeThe amount on monthly, quarterly or annnual income an investor expects to make from their investments.
Investment ObjectiveProvides purpose for what the investment will do. I.e provide growth or income.
Investment Policy StatementLays out the rules on how the portfolio manager will govern a clients account.
Investment StrategyTakes into consideration, goals, future needs, risk and guides the investor on how they should invest capital.
Investment VehicleAssets offered by the investment industry to help investors move money from the present to the future, with the hope of increasing the value of their money.
IRA RolloverMost commonly, this occurs from a 401(k) into an IRA. It can also occur by consolidating multiple IRA's into one.
IssuerA company that sells its securities to recieve capital.

J

JPYJapanese Yen - a currency.
Job MarketInformal market where workers find paying work and where employers find willing workers.
Jobless ClaimsReported by the U.S. Department of Labor weekly to count the quantity of individuals filing for unemployment benefits.
Jobs GrowthReported by the Bureau of Labor Statistics to track the quantity of U.S. jobs created monthly.
John BogleThe godfather of mutual fund index investing, low cost investments, and Vanguard.
Joint AccountFinancial account shared by multiple individuals.
JTICJoint Tenants in common
JTWROSJoint Tenants with Right of Survivorship
Jumbo CDUsually a minimum of $100,000 and pays higher interest.
Jumbo LoanAs of 2019, a mortgage loan of $484,350+.
Junk BondAlso referred to as a high-yield debt, is used to describe bonds that issue high yields and are rated below investment grade.

K

Kelly School of BusinessBusiness school of Indiana University.
Keltner ChannelTechniocal indicator that is volatility based.
Key EmployeeSomeone with ownership or is vital to decision-making.
Key Person InsuranceLife insurance on the key employee.
Keystone XL PipelineTransports oil from Canada to US refineries.
KYCKnow Your Client.

L

Labor MarketThe job market.
Labor UnionAn organization responsible for the interests of its employees.
LaggardA security that is underperforming compared to its peers or benchmark.
Lagging Indicatoran indicator that switches after a target variable has already occured.
Large CapDescribes companies with market capitalizaions greater than $10 Billion.
Large TraderSEC describes this person as someone who transacts $20,000,000 or 2,000,000 shares daily.
LIFOLast In First Out
LTMLast Twelve Months
Law of Large NumbersStatistical probability showing that as the sample size grows, the mean becomes more predictable.
LeadershipRefers to a company's management.
Lean Six SigmaManagement strategy to increase performance by reducing or eliminating defects and waste.
Lean StartupExplains the scientific methodology to approach creating a business.
Legal MonopolyA monopoly that is protected by the government.
Legislative RiskInvestment risk related to government law.
Level 1 AssetsAssets that can easily be assigned a fair market value. Includes: stocks, bonds, funds or other mark to markets assets.
Level 2 AssetsAssets that can be assigned a fair market value with neither ease or over complexity. Values of these assets can be approximated using financial models.
Level 3 AssetsAssets that are difficult to assign a fair vlaue to. The use of complex internal models provide
LeverageThe use of borrowed money in order to magnify gains (or losses).
Leverage RatioThe amount of borrowed money over the amountn of equity put forth.
Leveraged BuybackRefers to when a comoany uses borrowed money to repurchase their own outsanding shares.
Leveraged ETFAn ETF that uses borrowed funds to multpily the returns (or losses) of the securities or assets it is tracking.
LFCFLevered Free Cash Flow
LIBOR CurveThe Lond Interbank Offered Rates shown graphically.
Life InsuranceInsurance that pays out an amount when the insured person dies.
Limit DownA trading halt occurs for a stock or commodity when that spoecific security exceeds a specific percentage decline.
Limit OrderAn order to buy or sell a security at a specific price.
LLCLimited Liability Company
LPOALimited Power Of Attorney
Liquid AssetEasily converted to cash.
Liquid MarketExcess volume allowing for swift trade execution.
LiquidityMeasure of trading volume or cash (or cash equivalents) available to a company.
Liquidity RatioDetermines how liquid a company's balance sheet is. Common liquidty ratios include: current ratio, quick ratio, and operating cash flow ratio.
Listed SecurityA security that is traded on an exchange.
Living TrustA legal document that is written while you are alive and places assets into a trust that is later transferred to a beneficiary upon death.
Living WillA statement that is written while you are alive stating your medical treatment wishes if you were not in the mental capacity to make decisions.
LoadA fee paid in the form of comission to a broker when buying (or selling) a mutual fund.
LCDSLoan Credit Default Swaps
LTCLoan-To-Cost
LTVLabor Theory of Value
LobbyTypically a group, seeking to influence politicians or the public on an issue.
LIBORLondon InterBank Offered Rate
LSELondon Stock Exchange
Long HedgeA futures postion that locks in the price for a purchase.
Long PutRefers to buying a put option when anticipating an asset's market price will significantly drop.
Long StraddleA strategy in which a long call and long out are bought for the same security at the same expiration date and strike price.
Long TermCan describe any financial instrument with a maturity greater than 12 months.
Long/Short FundA type of mutual or hedge fund that takes long and short positions in secuities in hopes for better returns.
Long-Term AssetsAssets that are expected to last longer than 12 months.
Long-Term Capital Gain or LossThe gain or loss that results from an investment that has been owned for at least 12 months when sold .
LTCMLong-Term Capital Management.
LTCLong-Term Care
Long-Term DebtDebt with a maturity greater than 12 months.
LEAPSLong-Term Equity Anticipation Securities
LTGLong-Term Growth
Long-Term InvestmentsInvestments that are held for over 12 months.
Long-Term LiabilitiesLiabilities that are due over 12 months from the current time.
Loss CarryforwardA technique used in accounting where losses from prior years are carried into future years net income to reduce future tax liability.
Lost DecadeA term used to describe a decade of economic decline or recession that orginated from Japan's 1990s period of economic crisis.
Low Volume PullbackPrice of a secuity moves in an opposite direction compared to the uptrend occuring on volumes lower than the average.
Luxury TaxA tax placed on goods or services that are not essential.

M

M1The total value of the most liquid assets available in the economy. M1 = currency in circulation + checkable deposits + traveler's checks.
M2The total value of teh most liquid assets plus any near assets (slightly less liquid). M2 = M1 + savings deposits + money market funds + certificates of deposit.
Macro EnvironmentRefers to looking at the economy in its entirety, instead of individual sectors or regions.
Macro ManagerA management style where a manager gives more freedom to the employees, with little supervision.
Macroeconomic FactorsAn impactful condition that affects a national economy or region (ex. unemployment).
Main StreetIn contrast to Wall street, this is a colloquial term that describes the small and independent businesses of America.
Majority ShareholderControl of at least 50% of shares in a company.
Managed AccountAn investment account that belongs to one investor, but is managed by a money manager.
Management FeeA fee charged by a portfolio manager for the services provided to clients; fees are percentage based of the assets under management.
MarginRepresents the difference between the value of an investor's account and the amount borrowed from a brokerage firm to buy a security.
Margin AcccountA brokerage account where an investor is loaned money from a broker to buy assets.
Margin CallRefers to when a broker demands an investor to deposit funds into the margin account when the value of the account declines below the broker's minimum requirement.
MRThe additional revenue gained from producing one more unit.
Marginal Tax RateThe tax bracket that your highhest dollar of income falls into, and therefore is the highest tax rate you pay.
Market CycleLooks at the trends that result from different market environments during a period of the two most recent highs or lows of a benchmark.
Market EfficiencyMarket prices should reflect all relevant and publicly available information.
Market ExposureMeasures the amount of money invested in a type of security, sector, or industry.
Market IndicatorsTechical indicators that attempts to forecast the market moves of stocks or financial index.
Market LeaderA company which has the largest market share in an industry.
Market MakerA company or individual that continuously quotes prices and volumes of secuirties to keep a liquid market.
Market OrderAn order made by an investor, through the help of a broker, to buy or sell a security at the best price.
Market PriceRepresents the current price of a security.
Market ResearchA tool used to help a firm to know what an investor is seeking by conducting research directly with investors.
Market RiskThe risk of losses due to the performace of an asset in a financial market.
Market SentimentThe attitude that investors have toward a market or individual stock.
Market ShareThe percentage of sales of a single company in an indsutry.
Market TimingA strategy of investing where the investor tries to beat the market by predicting the best time to buy or sell.
Marketable SecuritiesAssets that are liquidable and can be converted to cash in a quick manner.
MLPMastered Limited Partnership - a publicly traded limited partnership that utilizes the tax benefits of private partnerships and the liquidity of publicy traded companies.
Matching OrdersAn inverse order where one investor wishes to buy a certain volume of stock and another is seeking to sell the same volume at the same price.
Maturity DateThe date when the principal amount of a debt is due.
MedianRepresents the middle number in a set of data; can be more useful than the average.
Melt UpAn immense improvement in the value of a security when investors unexpectedly buy the securities and drive up the price with no reason behind it.
MergerAn agreement that combines two current companies into one.
M&AMergers and Aquisitions
Micro CapPublicly traded company with capitalization between $50 and $300 million.
MicroeconomicsEconomics that relate to individual decisions on a small scale.
Mid-CapA term used to describe companies that have a market capitalization value between $2 and $10 billion.
Middle OfficeThe department in a financial services company that overlooks risk and determines gains and losses .
Midstream Oil Operations1 of the 3 major stages of oil and gas industy operations that involves transporting, storing, and marketing of oil and natural gas/liqu.ids
MillennialAnyone born between the years 1981 and 1996.
Minority InterestOwnership of less than 50% of a company or interprise.
Mission StatementFormal summary of the aims and values of a company.
MPTModern Portfolio Theory - a theory that places great importance on the fact that risk is a crucial part for investors to create a portfolio that maximizes the expected return.
Momentum InvestingStrategy that aims to profit off of continuing trends in the market. Buy securities that have had high returns over the last 3 to 12 months and sell ones with low returns.
Monetary PolicyHow governments control the supply of money and interest rates to influence econmic activity.
MoneyA liquid asset used as a medium of exchange to conduct transactions.
Money FlowChange in value of a secuirty on a trading day. Calculated by averaging the high price, low price and closing price and multiplying the result by the trading volume.
Money ManagementBuilt of expense tracking, investing, budgeting, banking, and evaluating taxes.
Money ManagerAn individual or firm that manages the portfolio of an investor or institutional investor.
Money MarketInvolves the trading of large volumes of short-term debt investments.
Money Market AccountA deposit account that pays interest based on the rates of the money market.
Money Market YieldReprsents the interest rate earned from investing in short-term and highly liquid securities.
Money OrderCertificate backed by cash, issued by banking institutions.
Money SupplyThe amount of money in circulation.
Monte Carlo SimulationA model used to be more aware of the risk in prediction and forecasting for outcomes not easy to solve.
Moore's LawLaw that says the speed and capability of computers can be expected to double every 2 years.
Morbidity RateFrequency with which a disease appears in a population.
Morningstar Inc.A respected research firm based in Chicgo that provides investment analysis for funds, stock, and general market data.
Morningstar Risk RatingRatings given by Morningstar to publucly traded ETFs and mutual funds.
Morningstar Sustainability RatingA rating that allows investors to see how roughly 20,000 mutual funds and ETFs are dealing with sustainable challenges.
Morality TableTable showing the rate of deaths occuring during aperiod of time.
MAA common technical tool used that smoothes out price data by creating constantly updated average prices.
MACDThe moving average convergence divergence is a momentum indicator that follows trends to show the relationship between two moving averages of the price of a security.
Multi-Asset ClassCombination of asset classes used as an investment.
MultiplerA factor that causes changes in many other variables when it is changed.
MSRBThe Municipal Securities Rulemaking Board is a rulemaking body that creates guidelines that should be followed for firms and banks when issuing and selling municipal securities.
Mutual FundInvestment program funded by shareholders that trades diversified holding and is professionally managed.
Mutual Insurance CompanyAn insurance company owned by policyholders.

N

Naked CallWithout owning the underlying security, the investor creates an option strategy selling the options.
Naked OptionWithout compromise ownership of the underlying security an option contract is sold from a party.
Naked PutWith no underlying security assosciated, a put option is sold resulting in the security going up in price.
Nasdaq 100 Index100 of the largest U.S companies that are most frequently traded on the Nasdaq stock exchange.
Nasdaq Composite IndexA collection of over 2,500 equities listed on the Nasdaq stock exchange.
Nash EquilibriumCreated by John Forbes Nash Jr. is a game theory which involves two or more players where each player is aware of the equilibrium strategies of the other(s).
National BankIn order to be a National Bank the bank must be a member of the Federal Reserve and is also considered a commercial bank.
National CurrencyA medium of exchange isssued by a country's national bank.
Natural Gas ETFA basket of nautural gas securities traded like equities on national exchanges, used to track the natural gas sector.
Natural HedgeA management strategy that reduces the risk that can arise by investing in assets with performance that is negatively correlated.
Natural MonoployOften the first supplier in a market, it is a monopoly that exsists due to large starting costs or economies that are powerful in conducting business in a specific market.
NAV ReturnIn a mutual fund or ETF it is the change created over a specific period of time.
Near TermA specific period of time that is typically not far in the future.
Near the MoneyWhen the current market prrice of an underlying security is close to the strike price of an option contract.
NecklineUsed by traders to determine correct points of placing orders is either a support or resistance level found in a head and shoulders pattern.
Negative ArbitrageWhen the borrower has an interest rate to pay on its debt that is higher than the rate used on the money to repay the debt.
Negative Bond YieldWhen the holder of a specific bond loses on the investment.
Negative CorrelationDetermined between two variables, is when the relationship occurs when one variable increases, the other will decrease.
Negative Interest RateOccurs when lenders pay borrowers interest instead on traditional loans which is when the borrower pays the lender interest.
Negative ReturnA financial defecit or loss on returns.
NAVNet Asset Value
Net IncomeA company or business's income created by sales minus the expenses used to measure the profitability of a company.
Net LossIn a specific period of time, is when the expenses are more than the total revenue created.
Net Present Value (NPV)In a specific period of time, the difference created between the present cash inflows and outflows.
Net VolumeIn a specific period of time, it is an indicator calculated by the difference of a security's upstick volume by the downstick volume.
Net WorthThe value of company based on the value of all of their assets minus any of their outstanding liabilities.
NetworkingCan occur between individuals, groups, or institutions is the action of exchanging information and developing contacts.
New Home SalesPublished monthly by the United States Census Burea is the amount of sales from newly built homes, used as an economic indicator.
NYMEXNew York Mercantile Exchange
NYSENew York Stock Exchange
News TraderRefers to an investor or trader who makes decisions based on current news events.
No-Load FundRefers to any mutal fund that does not charge either comissions or a sales charge.
NoiseRefers to any information that could mislead or confuse current trends.
Nominal Interest RateInterest rate before adjusting for inflation.
Nominal Rate of ReturnRate of return before adjusting for inflation.
Non-Accredited InvestorInvestor with net worth of under one million dollars or an annual salary less than 200,000 dollars per year (300,000 for marrid couples filing jointly).
Non-Deliverable Forward (NDF)Cash-settled short-term foward.
Non-Deliverable Swap (NDS)A swap of currencies that is not physically delivered.
Non-Disclosure Agreement (NDA)Legal contract that outlines confidential information.
Non-Farm PayrollA statistic that shows the number of people employed in maunfacturing, construction, and goods companies in the US.
Non-Member BanksBanks that are not members of the US federal reserve system.
Non-Qualified PlanRetirement savings plans that do not follow ERISA.
Non-Qualifiying InvestmentInvestment that is not tax-exempt or tax-deffered.
Normal Yield CurveA curve where the short-term yield (ex: 2-year T-Note) is lower than the long-term yield (ex: 10-year T-Note).
North American Free Trade Agreement (NAFTA)An agreement used to promote trade among the US, Mexico, and Canada by eliminating most tariffs.
North American Securities Administrators Association (NASAA)An association with the responsibility to protect indivudals who purchase securities and investing advice.
Notional ValueNominal amount used to calculate payments.

O

October EffectThe belief that stocks will decline in the month of October because of historical market collapses during the month.
Odd LotAn order amount for an asset less than its standard unit of trading; generally anything less than 100 shares of stock.
Odd Lot TheoryA technical analysis theory that assumes small investors are incorrect and invidual investors will generate odd lot sales more often than others.
OfferA bid to purchase an asset.
OffshoreDoing busniess abroad, usually because of lower costs.
Open MarketA market with no barriers to enrty.
Opening BellSignals the start of the trading day at an exchange.
Opening PriceThe price a security is trading at when the trading day begins.
Opening RangeThe high and low of a certain period once the exchange has opened ; typically the first 30 minutes of trading.
OCFOperating Cash Flow. The amount of cash that comes from a firms business operations.
Operating CostExpenses that are tied to the operation of a business.
Operating ExpenseAn expense a firm incurs through their day to day operations.
Operating IncomeMeasures the amount of profit generated through business operations.
Operating RevenueRevenue generated from a firms day to day operations.
Oprah EffectRefers to how the endorsement of Oprah causes a boost in sales.
Option AgreementA contract between two parties, that gives one of them the right to buy/sell an asset to the other party at a specific date at a specific price.
OptionsThe right to buy/sell a security at a specific strike price on or before a specific date.
OCCOffice of the Comptroller of the Currency
OrderRequest to have something done.
Ordinary DividendsShare of firms profits paid out to shareholders.
Ordinary IncomeIncome subject to standard taxes.
Ordinary LossLoss realized when expenses are higher than revenue, fully deductible.
Ordinary SharesGrants a holder equity ownership in a firm.
Organic GrowthAchieved by increasing output and using internal resources to expand.
Organic SalesThe stream of revenue generated from business operations.
OPECOrganization of Petroleum Exporting Countries
OTC PinkMarketplace for trading over the counter stocks.
Other Current LiabilitesLiabilities to be paid within one year.
Other Long-Term LiabilitesLiabilties to be paid over one year.
OTMOut of The Money
OutperformGaining a higher annualized percentage gain (or lower annualized percentage loss) than the benchmark beind used.
OTCOver The Counter
Overall TurnoverHow quickly inventory is replaced.
OvercapitalizationWhen a firm has more debt than liquid value of assets.
Overheated EconomyWhen an economy's capacity cannot keep up with the demand.
Overnight RateThe interest rate used by banks to borrow overnight.
Overnight TradingTrading that takes place when major markets are closed.
OvershootGoing past a targeted point.
OversoldSelling more than targeted.
OversubscribedSubscribing more than targeted.
OversupplySupplying more than targeted.
OvervaluedValuing more than targeted.
OverweightHolding higher position weightings in specific securities compared to the benchmark.

P

Paper MoneyA country's standard currency that is produced from paper and can be used as a unit of exchange.
Paper TradeThe practice of buying and selling without the risk of losing real money, typically used for training purposed.
Par ValueOr Face Value; The sum of money that the corporation promises to pay at the bond's expiration.
Parent CompanyA corporation that owns more than 50% interest in another company.
ParityEvenly matched values between two or more things.
PartnershipExists when two or more persons operate a business a co-owners for profit.
Passive IncomeIncome generated through cash dividends or premiums being recieved through written options.
Passive InvestingNo active trading within the portfolio. Avoids additional transaction costs by doing so.
PatentProperty right granted to an inventor for new, useful, and non-obvious inventions.
Patriot ActLegislation passed after 9/11 to deter and punish terrorist acts in the United States by enchancing law enforcement, surveillance, and investigatory tools.
Payday LoanA high interest short term loan based on the the debtors income and credit history.
Payout RatioPercentage of earnings the corporation pays to its investors as dividends, this is usually shown as a certain percentage of the the total earnings of the corporation.
Peer GroupGroup of people that have similar interests and personalities.
PeggingWhen one company attempts to control their currency by tying its value to another countries currency.
Penny StockThe stock of a small company typically priced at less than 5$ per share.
Pension PlanType of retirement plan in which the employer makes small investments to the plan to ensure a healthy financial future for their employees. the small investments are invested on behalf of the employee and those earnings are used in retirment.
Per Capita GDPA measure of the total output of a country that takes into account gross domestic product and divides it by the number of people in the country.
Performance ManagementA continuous process of identifying, measuring, and developing the performance of individuals and teams and aligning performance with the strategic goals of the organization.
PerpetuityA stream of equal cash flows that occur at regular intervals and last forever.
Personal FinanceProcess of planning your spending, financing, and investing in order to optimize your financial situation.
PhilanthropyAn individual or organization set up to provide help and raise money for those in need on a large scale.
Pink SheetsReference to the listing service of the stocks that trade over the counter (OTC). typically, these socks are considered penny stocks.
Point-and-Figure ChartFinancial chart that plots price changes in financial assets without accounting for time passage.
Point of SaleThe time and place where a retail transaction was completed.
Political EconomyTerm used for studying production, buying, and selling, and their relations with law, custom, and government, as well as the distribution of national income and wealth.
Ponzi SchemeAn illegal investment scam that uses funds from subsequent investors to pay returns to earlier investors rather than distributing revenues generated from actual business.
Pooled FundsFinancial funds made up of asssets from mady different investors. examples include hedge funds and mutual funds.
Portfolio ManagementThe process of actively managing assets in a portfolio to achieve long term market success.
Portfolio TurnoverThe measure of how quickly assets within a portfolio are being bought and sold by the fund manager.
Portfolio VarianceRisk measurement of how the portfolios returns fluctuate over time.
Poverty TrapAn economic standard making it difficult for poor people to escape poverty by requiring a certain amount of capital to break from poverty.
Power of AttorneyA legal document in which consent from a client is given for the attorney to act on behalf of the client and is authorized to make legal decisions.
Pre-MarketMarket trading that occurs between 8 - 9:30 am EST.
Preferred DividendDividends paid to preferred stockholders which have priority over common stockholders.
Preferred StockShares which pay fixed dividends and have dividend preference and liquidation preference over common stock.
PremiumThe pruchase of a financial instrument at more than face value.
Present ValueA measurement of the future value of money or asset in todays dollars after being adjusted for inflation.
Price CeilingsGovernment imposed limit on the price charged for a product which is intended to protect the consumer.
Price ControlsGovernment regulation of price opposed to being determined by the market. This is done by the government implementing price floors or price ceilings; which are maximum and minumum pricing levels.
Price LevelAverage current price of all goods produced throughout the economy.
Price-to-Book Ratio (P/B Ratio)Compare a firms market capitalization to its book value.
Price-to-Earnings Ratio (P/E Ratio)Relates a company's current share price to earnings per share.
Primary MarketA market where new securities are listed in which economic actors can obtain debt or equity based financing.
Prime BrokerageUnique group of services the brokerages offer to clients. these services inlclude securities lending, leveraged trade executions and cash management.
Prime RateThe best available interest rate banks offer their most creditworthy customers.
Private EquityType of fund that invests strictly in private companies or that engages in buyouts of public companies.
Private PlacementThe sale of assets to pre-chosen investors rather than being sold on the open market. another way a company can raise capital without an ipo.
Private SectorSector of the economy that is managed by private individuals not the government.
Producer Price Index (PPI)An index tracking the prices of the goods bough and sold before the make it to the consumer retail level.
Profit and Loss Statement (P&L)Accounting statement created at the end of the financial quarter or year that indicates whether the company operated at a net loss or net gain.
Profit MarginShows for each dollar of revenue, what percent was kept as profit for a corporation.
Profitability RatiosFinancial measurement used to determine a business capacity to generate earnings when dealing with revenue, assets, balance sheets, operating costs etc.
ProspectusA written document, required by securities laws, that describes the security being sold, the financial operations of the the issuing corporation, and the investment risk attached to the security.
ProxyA document giving one person the authority to act for another, typically the power to vote for shares of common stock.
Public CompanyA company with shares traded on one or more national stock exchanges.
PullbackA reduction in price or demand.
Pump-and-Dump SchemeIllegal scheme to boost an owned stock's price through false or misleading statements, in order to sell the owned stock at the inflated price.
Purchase Annual Percentage Rate (APR)the interest that is added monthly on the outstanding credit owned on the credit card.
Purchase PriceThe price an investor pays for an investment.
Purchasing PowerAmount of goods and services that can be purchased with a unit of currency.
Put-Call RatioMarket Indicator that shows investors information regarding trade volumes of a securities put to call option.
Put OptionA contract that gives the buyer the right to short sell a security at a predtermined price within the stated time period.
Pyramid SchemeAn illegal fraud scheme where illusionary products or profits are sold instead of real or legitimate products. The investments of subsequent investors are used to pay the promised returns of earlier investors.

Q

Qualified AnnuityRetirement savings plan that has tax-deffered contributions.
Qualified Charitable OrganizationNon profit organization with a tax-exempt status.
Qualified DistributionTax-free withdraw from a retirement plan.
Qualified DividendDividends that are taxed at the capital gains rate.
QDIIQualified domestic institutional investor.
QDOTQualified domestic trust.
QEPSomeone who is eligible to trade in complex funds.
QFIIQualified foreign institutional investor.
Qualified Retirement PlanA retirement plan that compounds interest tax-free.
Qualified TrustStock bonus, profit sharing plan, pension established by an employer .
Quality of EarningsIncome that is due to a higher amount of sales .
Quant FundAn investment fund that uses algorithims.
QAQuality assurance.
Quant FundAn investment fund that uses algorithimic trading methods.
Quantitative EasingMonetary policy where the federal bank buys back their bonds in order to put cash in the hands of firms and individuals.
Quantitative Easing 2Second round of quantitative easing process.
Quantitative TradingTrading strategies using algorithims.
Quantity Theory of MoneyThe price level of goods and services directly relates to the money in circulation.
QoQQuarter on Quarter
Q1, Q2, Q3, Q4First quarter, second quarter, third quarter, fourth quarter.
QTDQuater to Date
Quarterly Revenue GrowthIncrease in firms revenue from previous quarter.
Quick AssetsAssets that can quickly be converted to cash.
Quick Liquidity Ratio(Quick assets)/ (net liabilities+reinsurance liabilities).
Quick Ratio(current assets - inventory) / (current liabilites).
Quoted PriceA price at which someone will be willing to buy or sell a security, consists of a bid and ask.

R

R-SquaredDenotes the level of correlation between data points.
RallyAn reversal of poor performance in the stock market into a solid recovery.
Random Walk TheoryTheory of how past movement of stocks cannot be used to predict future movement.
RangeDifference between high and low prices of an asset over a fixed time frame.
ROCReturn on Capital
Rate of ReturnDollars earned over the investment period per dollar invested.
RatingA score given to something based on performance.
Raw MaterialsMaterials in their natural state, before they are processed or used in manufacturing.
Real AssetTangible assets used to produce goods and services.
Real Economic Growth RateRate at which GDP changes from year to year.
REITReal Estate Investment Trust
RELPReal Estate Limited Partnership
GDPGross Domestic Product
Real IncomeIncome adjusted for inflation.
Real Interest RateThe nominal interest rate adjusted for expected or actual inflation.
Real Rate of ReturnEquals the nominal rate of return minus the inflation rate.
Realized GainWhen an asset is sold higher than the original purchase price.
Realized LossWhen an asset is sold lower than the original purchase price.
Realized YieldRepresents the earned actual return of an investment during the holding period.
RebalancingThe realignment of the weights of assets in a portfolio to keep with desired risk levels.
RecapitalizationThe realignment of a companies equity and debt ratio to increase a corporations capital stability.
Receivables Turnover RatioRatio used to determine how effective a company is at collecting it's receivables owed.
RecessionA decline in overall business activity. During a nationwide recession, a country suffers from a drop in buying, selling, and a rise in unemployment.
Record dateThe last date determined by a corporation by which shareholders are eligible to receive a company distribution.
Red HerringPreparatory prospectus filed by a company prior to the IPO with the Securities and Exchange Commission.
RedemptionRepayment before the fixed income security before the.
RIAactor who manages and advises high wealth individuals on investments with in their portfolio.
RRAn actor who works for a brokerage firm that represents investors assets.
Reg DSecurities and Exchange Commission regulation of rules dealing with exemption from registration requirements. This allows companies to offer their securities without directly registering with the SEC.
Reg SHOSEC rules that monitor short sale practice.
Reg TRules created by the Federal Reserves Boad of Governors dealing with the amount of credit firms are allowed to allocate to investors with the purpose of purchasing securities.
Regulatory RiskWhen the government creates new laws or changes existing laws that will greatly affect the fundamental aspects of a market, industry, or business.
ReinvestmentWhen an investor purchases additional assets using funds that were generated from past investment return including dividends, interest and cash distributions.
Relative StrengthThe process of using momentum investing. This consists of purchasing assets that have a history of performing well in recent months realtive to their benchmark.
RSIRealtive Strength Index
RepoA tool used by the central bank when performing open market operations. Also, a type of short term lending for dealers in government securities.
Research AnalystA financial actor whose job is to develop and present reports on securities and for the firms use.
R&D ExpensesCosts incurred by a corporation to develop new products or processes.
Residual IncomeThe income generated by an actor after paying off necessities such as rent, utilties, food etc.
Restricted StockStock that is unregistered and is awarded to corporation ownership and corporate affiliates for compensation.
RestructuringWhen a company modifies certains financial aspects of their business to minimize financial stress.
Retail BankingProvision of services by a bank to the general public.
Retail InvestorA non-professional investor who trades securities on traditional or online brokerage firms such as E-Trade or Robinhood.
Retail SalesTracking consumer demand for consumer products by calculating the buying of goods over a predetermined period of time.
Retained EarningsCumulative amount of net income over the life of the corporation minue the cumulative amount of dividends paid out to shareholders.
Retirement AccountAn account consisting of money stashed away for when an actor retires typically invested in mutual funds and ETFs.
ROAReturn On Assets
ReturnThe sum of the income and the capital gain or loss earned on an investment over a specified period of time.
ROEReturn On Equity
ROIReturn On Investment
RevenueThe income generated from the sale of goods or services associated with the main operations of an organization before any costs or expenses are deducted.
Revenue Per EmployeeMeasure of the efficiency of a business in generating revenues, which is computed as total revenue divided by number of employees.
Revenue Per User (RPU)Calculated as total subscription revenue divided by the number of subscribers.
Reverse Stock SplitA stock split in which a firm's number of shares outstanding is reduced, making the shares outstanding more valuable.
Revocable BeneficiaryA beneficiary to an insurance policy that does not have all the guranteed rights to compensation. Like a will, the owner of the policymaker has the right to determine who receives a stipulation, the terms of the policy or cancel the policy without the beneficiary's approval.
Revocable TrustA type of trust in which the terms can be rearranged or cancled by the original trust creator
Revolving CreditA situation in which credit is refilled up to a certain point as the actor continuously repays their debt offering the actor access to capital even with debt outstanding.
RiskThe chance a financial outcome will differ from the expected outcome.
Risk-Adjusted ReturnAn investment's total return when attributing the amount of risk that was associated with the production of that return.
Risk-AverseType of investor who favors a low risk low reward strategy to higher risk higher reward associated investments.
Risk-Free AssetType of asset that will proudce a future return without a possibility of loss. An example be purchasing United States Treasury bills.
Risk-Free Rate of Returnhypothetical rate of return that an asset will proudce with no risk involved. Typically, the rate of return an investor would expect from a risk-free asset.
Risk ManagementThe practice of determining potential future risks and taking precasutionary measures such as hedging to limit that risk.
Risk ParityApproach to investment strategy which focuses on allocation of risk.
Risk ProfileAn assessment of an individual's risk tolerance geared towards creating an optimal portfolio based on each client's risk tolerance.
Risk-Return TradeoffUsed to compare expected return of investment with the amount of risk taken.
Risk-Reward RatioThe award that can be earned for every dollar risked on an investment.
RoadshowPresentations made at several locations in the lead up to an initial public offering.
Rolling ReturnsAnnualized average returns for a fixed time period.
RolloverThe transfer of holdings in one retirement plan to another one while maintaining a tax exempt status.
Roth 401(k)Employer sponsored savings account that is funded by contributing post tax dollars up to the contribution limit.
Roth IRAAn individually backed retirement account that allows participants to contribute post-tax income and take advantage of tax deferred growth on capital gains and dividends. Assets aren't taxed during distribution like a traditional IRA but if distributions are taken prior to 59.5, idnividuals will be assessed a 10% penalty (unless tax exceptions are met). as of 2019, the annual contribution limit is $6,000 and $7,000 for those 50 and older. as of 2020, jointly filing couples will be phased out of contributing at income levels ranging from $196,000 - $206,000; for single filers this range is $124,000 - $139,000.
Round LotDescribes a standard trading size for securities. A round lot is typically 100 shares or a larger share number that is divisible by 100.
Routing Transit Number (RTN)Nine digit bank code that appears on the bottom of checks that identifies the financial institution on which it was drawn.
RoyaltyA payment made to the legal owner of the property, patent, copyrighted work, or franchise by licensees who wish to make use of it in order to generate revenue.
Rule of 72The number of years it takes for a certain amount to double in value is equal to 72 divided by its annual inerest rate.
Russell 1000 IndexA stock market index that tracks the largest stocks contained in the Russell 3000 index. Similar to the S&P 500, it's designed to track large-cap (market cap exceeding $10 Billion) equities.
Russell 2000 IndexA stock market index that tracks the smallest stocks contained in the Russell 3000 index. It's designed to track small and mid-capitalization equities.
Russell 3000 IndexA stock market index that is designed to track the entire U.S. equity market. It is a market-capitalization weighted index made up of the 3,000 largest equities traded in the United States.

S

S-CorporationA corporation with a maximum of 100 shareholders that is taxed as a partnership.
S&P 500 IndexThe most widely used benchmark in the asset management industry, It comprises of the 500 largest companies traded on U.S. exchanges.
Safe HavenA type of investment where there is belief that it will either increase or retain its value when the market is unstable.
Sarbanes-Oxley (SOX) Act of 2002A law passed by us congress, in response to the fradulent acts done by enron, that helps to protect investors from corporations producing fraudulent reports.
ScalpingTrading style specializing in taking profits on small pirce changes of stocks.
ScarcityEconomic condition that exists in society where there are not enough resources to satisfy people's wants/needs.
Schedule 13DA form filed with the SEC when there is an acquisition of at least 5% of a company's shares.
Schedule 13GA condensed version of the schedule 13d form that can be filed if the investor satisfies an exemption.
Schedule AA form that is optional for taxpayers who prefer to itemize their tax deductions instead of a standard deduction.
Schedule K-1A tax document made for business partners or s corporation shareholders that reports their incomes, losses, and dividends.
SEC YieldA standard yield calculation made by the sec that compares bond funds with the effective interest rate an investor may potentially earn in the future.
SectorA part of a market that shares similar characterisitcs.
Securities Act of 1933A law passed after the stock market crash of 1929 that aimed to create transparency and reduce fraudulent activities in securities so investors were more protected.
Securities and Exchange Commission (SEC)Regulates the U.S. security markets, protects investors from fraud or misleading information, and facilitates capital information.
Securities Exchange Act of 1934Seeks to prevent fraud in the buying or sale of a security on the secondary market.
SecuritizationThe process of pooling loans/debts together into one package which produces a single cash flow, delivered from the cash flows of the loans that make up a new security.
SecurityStocks, bonds, and other such financial instruments bought and sold by investors.
Security Market Line (SML)A line that demonstrates the relationship between risk and returns of a security that was derived from the capital asset pricing model (CAPM).
Self-Regulatory Organization (SRO)An organization that has the ability to protect its investors by setting its own regulations and promoting ethical behaviors.
Sell in May and Go AwayA warning to investors that suggests to divest their holdings in may and look to reinvest in november.
Sell-SideThe part of the financial industry that deals with the creating, marketing, and selling financial instruments.
Sensitivity AnalysisRefers to changing various assumptions in a financial model to see the affect it has on uncertainty.
Series 6A securities license that allows the individual to register with a firm and be able to sell mutual funds, insurance, and annuities.
Series 7A securities license that allows the individual to sell all securities with the exception of commodities and futures.
Series 24A securities license that allows the individual to manage and administer a branch at a brokerage firm.
Series 63A securities license that allows the individual to take orders in a certain state for any type of security and must uphold ethical and fiduciary obligations.
Series 65A securities license that qualifies an individual to act as an investment advisor in the US.
Series 66A securities license that qualifies an individual to act as an investment advisor or securities agent.
Service SectorThe largest sector in the global economy that is comprised of businesses that provide a service.
Shadow Banking SystemFinancial intermediaries that facilitate the creation of credit across the world but are not subject to regulatory oversight.
Share RepurchaseWhen a firm buys back its own shares from the secondary market.
ShareholderA person or company who have invested in a corporation and own some of its shares of stock.
Shareholder Equity (SE)Someone who is able to trade in complex funds .
Sharehoder ValueValue that comes from equity ownership in a firm.
SharesUnits of ownership in a firm.
Sharpe RatioRisk adjusted return used to measure portfolio performance. Instead of comparing returns to the market and using beta as the risk measure, it shows portfolio returns that are excess of the risk-free-rate (1-month Treasury bill) and divides that return by the portfolio’s standard deviation.
Shell CorporationAn firm that exists only on paper.
Short CoveringSecurities that are sold short to hedge against upward movement.
Short InterestNumber of days it takes for short sellers to cover positions.
Short SaleA sale where the income of selling the real estate is short of the debt against the property.
Short SqueezeHappens when a lack of supply and excess demand of stock occurs.
Short-Term InvestmentTemporary investment that can easily be converted to cash or less than 1 year holding period.
Silk RouteA series of ancient trade routes in the east.
Simple InterestQuick way of calculating interest payment.
Simple Moving Average (SMA)Adding recent prices and dividing by number of days.
Skin in the GameBeing involved in something to achieve a goal.
Small CapsFirm with market cap under one billion.
Social SecurityA federal program that taxes workers in order to provide income to them once they are of retirement age.
Social Security Number (SSN)A nine digit number assigned to U.S. citizens in order to track income.
Software-as-a-Service (SaaS)Software distribution model where a third party makes applications avaliable to consumers over the internet.
Sole ProprietorshipA form of business that is owned and operated by one person.
SolvencyA measure of a firm or bank's long term financial feasibility.
Sortino RatioContrasted from the sharpe ratio because it only takes into consideration the downside deviation in order to look at the negative volatility of an asset.
Sovereign Wealth Fund (SWF)An investment fund owned by the state and is funded from the central bank reserves and is used for the benefit of the economy and citizens .
SpeculationAct of buying stocks at great risk with the anticipation that the price will rise.
Spiders (SPDR)Standard and poors depository receipt.
SpinoffThe creation of an independent firm through selling or distributing new shares of an existing business.
Spot Exchange RateThe current price of a foriegen currency.
Spot MarketSegment of the market where assets bought and sold immediately.
Spot PriceCurrent price of an asset.
SpreadsThe difference between two figures.
StagflationAn economic cycle where there is a high rate of both inflation and stagnation.
StagnationA period of time where there is negligible or no economic growth in an economy.
StakeholderPeople that are involved with or are affected by a business.
Standard & Poor's (S&P)Stock market index that measures peformance of the 500 largest public firms in US.
Standard DeviationUsed to show how returns over a time period differ from the average (CAGR). A lower standard deviation means most of the returns are closer to the CAGR, and more spread out for a high standard deviation. Since S.O.G’s standard deviation is lower than the market, the portfolio is deemed less risky because the returns are expected to be more in line with the CAGR.
StockA type of investment that represents an ownership share in a company.
Stock CompensationA form of compensation in which employees are awarded stock.
Stock DividendA payment made by a firm to its owners in the form of stock.
Stock ETFA basket of stocks traded like equities on national exchanges, used to track stock sectors, sub-sectors, or entire stock indices.
Stock MarketAn exchange where equities are traded
Stock Market CrashA sudden a rapid decline in the prices of most stocks on an exchange.
Stock OptionThe option to purchase shares at a strike price.
Stock QuoteThe price of a stock.
Stock SplitAn increase in a firm's shares outstanding without any change in owner's equity. This is done by companies to increase the liquidity of the shares.
Stock SymbolAlso referred to a the ticker, is a stock's abverviated trading symbol name.
StockbrokerA professional who helps individuals buys and sell securities.
Stockholder EquityThe assets in a business after liabilities have been paid .
Stop-Limit OrderAn order to buy/sell a stock at the stop price.
Stop-Loss OrderBuy/sell a stock once it reaches a certain price.
Stop OrderAn order triggered to buy or sell a security when the price moves to a certain point .
StraddleAn options strategy where there is the purchase of a put and call option on the same underlying security at the same strike price with the same expiration date.
SWOT analysisA tool used to analyze a company's strengths, weaknesses, opportunities, and threats in the market place..
Stress TestingA technique where banks and investment portfolios are tested in a computer simulation to prepare for potential economic situations .
Strike PriceThe price that is set for a derivative contract to be bought or sold.
Structured NoteA unique debt obligation that incorporates a derivative component which adjusts the risk return profile of a security .
Subordinated DebtAn unsecured loan or bond that won't be paid until senior debtors are repaid in full first .
Subprime LoanA loan that is offered at higher interest rate than the prime rate for those who do not qualify for prime loans.
Subprime MortgageRefers to an individual who is a credit risk when taking out a loan because of thier below-average credit score; results in a higher interest rate to compensate the risk that the lender is taking.
SupplyThe amount of products and services that are offered for sale at all possible prices that could prevail in the market.
Supply ChainThe flow of products and services from raw materials to end users.
SupportA price below the current market, through which a stock's price tends not to fall below.
SustainabilityProsperity for all humanity of the present and for future generations.
Swing TradingAttempts to capture short term gains using technical analysis.
SyndicateA group of two or more corporations who combine their finanical resources in order to achieve certain investment objectives.
Systemic RiskRisk that affects the entire financial market or system, and not just specific participants.

T

T+1, T+2, T+3Settlement date of transactions of securities.
T-AccountUsed to map out liabilites and equity in left side of chart and assets on right side of chart.
Tactical Asset AllocationInvestment style where assets bonds, stocks, and cash are actively changed.
TakeoverThe purchase of one company by another by acquiring a controlling interest in its voting shares.
Tangible AssetAssets that have physical form.
Target-Date FundA fund where the allocation of funds becomes more conservative as target date gets closer.
TariffTax levied against on imports to help protect a nation's industries and labor from foriegn competition. It can also be used to generate revenue.
Tax BenefitAny tax law that provides an individual the opportunity to reduce their tax bill by meeting certain eligibility requirements.
Tax BreakGovernment offering a reduction of taxes for an affected collection of individuals.
Tax CreditAn amount of money that can be subtracted from taxes owed by individuals.
Tax DeferredWhen account earnings such as interest or capital gains are not taxed until they are withdrawn upon a certain date.
Tax ExemptIncome realized during the year that is excluded from gross income and is never taxed.
Tax PlanningThe structuring of transactions to reduce tax costs or to increase tax savings.
Tax RateDetermines the level of taxes imposed on the tax base for person or business in the form of a percentage.
Tax RefundMoney given back to individuals when their total of previous tax payments and applicable credits is more than the tax they owe.
Tax SeasonTime of year from early January to April 15th where individuals file their personal tax returns.
Tax ShieldReduction in total tax liability resulting from a tax deductible expense.
Technical AnalysisAnalysis using indicatiors of price action and algorithims.
Technical IndicatorSignals that are used to make buy/sell decisions.
Technology SectorThe sector that is based in technology firms.
Tender OfferA type of public takeover bid offering to buy some or all of shareholder's shares in a firm.
Term LoanA bank loan for a specifed amount that has a specified repayment timeline with a fixed or floating interest rate.
Thrift BankA small savings institution that mainly just accepts deposits and originates home mortgages.
Time DecayMeausre of decline in value of asset over time.
Time DepositAn interest bearing bank account with a set date of maturity.
Time HorizonThe time period an individual expects to hold an investment.
Time Value of Money (TVM)A relationship between time and money, that a dollar received today is wirth more than a dollar promised at some time in the future due to its position to work.
Too Big to FailVery large institutions that if they failed would have detrimental trickle down effect on many others
Top LineReference to gross revenue figures a firm reports.
Top-Down InvestingLooking at macro picture then looking at micro picture.
Total Bond FundSection of bond market replicated through etf.
Total Enterprise Value (TEV)Valuation measurement used to compare debt.
Total Expense Ration (TER)Total cost of a fund to the investor.
Total ReturnThe total percentage of return on assets.
Tracker FundAn index fund that tracks a wide market index.
Tracking ErrorThe divergence between price behavior of a fund and the specific index, commoodity, or security it is tracking.
TradeThe action of trasnferring goods or services between countries.
Trade DeficitOccurs when a country imports more than they export.
Trade SurplusOccurs when a country exports more than they import.
Trade WarWhen a nation imposes tarrifs or quotas on imports and foriegn countries relatiate with similar forms of trade protectionism.
TraderA person who actively buys and sells financial instruments.
Trading HaltOccurs when finra suspends the trading of one or multiple securities on an exchange. typically occurs prior to a major news outbreak that will greatly affect the price of the security.
Trading PlatformA marketplace where transactions can be executed.
Trading StrategyA specific method a trader uses to base their trading decisions. common active trading strategies include: day trading, position trading, swing trading, scalping.
Traditional IRAAn individually backed retirement account that allows participants to contribute pre-tax dollar amounts and take advantage of tax deferred growth on capital gains and dividends. assets are only taxed during distribution where individual will be taxed at their current income tax rate after age 59.5. if distributions are taken prior to 59.5, idnividuals will be taxed at their current income tax rate plus a 10% penalty (unless tax exceptions are met). required minimum distributions occur at age 72. as of 2019, the annual contribution limit is $6,000 and $7,000 for those 50 and older.
Trailing 12 MonthsA marketplace where transactions can be executed.
Transaction CostsAny costs of going through with an exchange transaction.
Transaction FeesA expense a business must pay every time it processes a payment.
TransparencyWhen required and relevant financial information is easily accessible by the investor.
Transportation SectorDeals with the movement of products and people.
TraunchA payment to be paid out over a period of time.
Treasury BillsShort term us government debt obligation.
Treasury BondsLong term us government debt obligation.
Treasury Inflation-Protected Securities (TIPS)A US treasury security that is indexed to inflation, protecting investors from inflation risk.
Treasury NotesOne to ten year us government debt obligation.
Treasury StockThe percentage of shares that a firm holds in its own treasury.
Treasury YieldThe yield on a treasury bill/note/bond.
TrendThe direction in which something is heading toward.
TrendineA visual representation that draws lines from support and resistance levels.
Treynor RatioHow much excess return was gained from the extra risk taken on.
Triple BottomA bullish pattern in a chart which shows three equal lows and then a breakout above the resistance level.
Triple TopUsed to predict revesal in momentum in price of security.
TroughLocal minimum of business cycle.
Troy OunceSystem of units of mass that is primarily used today in the precious metals industry..
TrustA three party system involving the trustor, trustee, and beneficiary.
TurnoverHow fast a business does its operations.
Turnover RatioPercentage of a portfolio that are replaced annually.

U

U-Shaped RecoveryFollwing an economic correction, this recovery typically consoldiates in the trough before prices recover upward, resmbling a "U" on the chart.
Uncle SamA figure used to represent the United States federal government.
UnderlyingRefers to the asset, debt, or commodity that is used to determine a derivatives price.
UnderperformWhen an investment experiences lesser gains or greater losses than the benchmark index (ex. S&P 500).
UndervaluedA term used to describe a security priced at a discount compared to it's intrinsic value.
UnderwriterAn entity, typically an investment bank, that evaluates another entity's risk for a fee.
UnemploymentDescribes when a person actively seeking employment is unable to find work. Used as a measure of economic health.
Uniform Gifts to Minors Act (UGMA)An act allowing individuals to transfer securities into the name of their underage beneificiary, free of taxes, up to a specific limit. Account is managed by an adult custodian up until the minor reaches the age limit at which point they take control of the account.
Uniform Transfers to Minors Act (UTMA)The extension act to the UGMA. Allows individuals to transfer assets other than securities including: money, patents, royalties, real estate, and fine art. These transfers shield the minor from taxes up to a specific limit.
Unit Investment Trust (UIT)An investment company that buys and holds a portfolio of securities where investors can buy redeemable units for a specific period of time.
United Nations (UN)International group formed after World War II with the intent to ease political and economic tensions between member nations. 193 out of the 195 countries on the planet are current UN member states.
Unlimited LiabilityRefers to the uncapped liability and full legal responsibility imposed on business owners and specific partners.
Unlimited RiskRefers to the potential uncapped losses an investor can incurr during a trade or investment. An example of unlimited risk would be a short sale on an equity security.
Unlisted SecurityA security that is not traded on national exchanges due to not meeting listing requirements. Instead, these securities can be traded over-the-counter (OTC).
Unrealized GainGains that are are shown in an account prior to being capitalized.
Unrealized LossLosses that are are shown in an account prior to being capitalized.
Unsecured DebtDebt that does not have collateral backing. If the borrower defaults, the lender has a chance to lose their entire investment.
Unsecured LoanLoan that does not have collateral backing and is instead created based off teh borrowerss creditworthiness.
UpgradeRefers to an increased analyst grade given to a specific security.
Upside/Downside RatioTotal market index momentum ratio indicated by advancing securities volume and declining securities volume. The ratio is calculated by dividing the total advancing securities volume by declining securities volume.
UptickThe increase in price of a financial security.
UptrendA trend that describes an increase in a financial isntrument's price.
U.S. TreasuryCreated in 1789, the U.S. Treasury is responsible for controlling monetary and financial policy in the country. Those specific responsibilities include issuing Treasury securities (T-Bills, T-Notes, T-Bonds), printing dollars, and overseeing U.S. Banks and the Federal Reserve.
Utlities SectorThe sector that comprises of utility comapanies. Utility companies provide basic amentities such as electricity, water, and sewage. This sector is viewed as a relatively safe equity investment as these companies offer necessary needs along with issuing high dividends comapred to other sectors.

V

V-Shaped RecoveryType of market recession and recovery that immitates a "V" on the price chart. This recovery is typically an aggressive rise in prices following a sharp decline.
ValuationThe process of analyzing a company to find its current or projected worth.
Value InvestingAn investment strategy that suggests purchasing stocks that appear to be undervalued (trading at a price less than the book value of the company).
Value StockA stock that is suggested to be undervalued, trading at a price less than the fundamentals associated with the company (dividends, earnings, etc.).
Vanilla StrategyAn investment strategy that stays relatively basic by passively investing in broadly diversified index-linked ETFs.
Variable AnnuityA type of annuity contract that bases the performance on the value of the underlying portfolio of assets or funds.
Variable Interest RateA type of interest rate that fluctuates due to the value of the underlying benchmark interest rate changing over time.
Variable Life InsuranceA permanent life insurance policy that contains separate accounts including various investment instruments and financial securities.
Variance EquationStatistical measure showing the spread between the recorded numbers in a data set, denoted by σ^2.
Venture Capitalist (VC)Companies that focus on providing financing to small start-up companies believing in their long-term growth potential.
VestingIn legal terms vesting describes the right to earn a present or future payment, benefit, or asset.
VIX (CBOE Volatility Index)Derived from price inputs from the equity benchmark, the S&P 500, the VIX measure the 30-day forward outlook of market volatility.
VolatilityInterprets the risk of a security or index by measuring dispersions of returns. Typically shown by variance or standard deviation.
VolumeThe amount of shares exchanged during a specific time frame.
Voting SharesShares that allow stockholders the right to vote on coroprate policy decisions.

W

W.P. Carey School of BusinessThe Arizona State University Business School. Highly ranked domestically and internationally.
Wash SaleOccurs when an investor realizes a losing security at the end of the calendar year to claim a tax deduction on capital losses, then repurchases the same security at the start of the new year.
WatchlistA specific list of securities used for monitoring potential trading/investing opportunities.
Weak DollarRefers to the value decline of the US Dollar compared to foreign currencies.
WealthMeasures an individual's total assets (physical and intangible) minus all liabilities.
Wealth ManagementA services provided by investment advisors to assist with portfolio management, financial planning, estate planning, as well as an array of other financial advisory services.
WeightA percentage that shows the amount of an asset held in a specific portfolio.
WillA.K.A. "Last Will and Testament" is a legal document declaring an individual's disbursement of assets post-mortem.
William F. SharpeAn economist and 1990 Nobel Prize winner. He has been attributed for developing the Capital Asset Pricing Model (CAPM) which describes the comparison between a portfolio's return compared to the market (systematic) risk. He is also know for creating the Sharpe Ratio which is used to describe a portfolio's risk-adjusted returns (see in definition above).
Win/Loss RatioThis ratio is calculated as winning trades divided by losing trades over a specific time period. This can be applied to unrealized and realized trades.
WithdrawalThe removal of funds from a bank account, savings, pension, brokerage, trust, or retirement account.
WithholdingThe partial allocation of an employee's income used to pay federal, state, or local taxes. Withholding reduces the annual tax burden.
World BankCreated in 1944 during the Bretton Woods Conference with the purpose to support and aid developing countries with their economic advancement.
Write-OffAn accounting measure used to reduce the value of an asset while increasing a liability account, decreasing the annual tax bill.

X

  

Y

Year to Date (YTD)The time period between the first day of the calendar (or fiscal) year and the current date.
Year-Over-Year (YOY)Term used to describe the comparison of percentage or price changes on an annualized basis.
YieldRealized gains generated on an investment over a specific time horizon.
Yield CurveA yield curve is a line that plots bond yields holding the same credit rating but different time horizons. I.E. the Treasury yield curve ranging from the 1-month T-Bill to the 30-year T-Bond.
Yield to Maturity (YTM)The total expected return on a bond if held to maturity.

Z

Zone of ResistanceRefers to a forecasted zone where a security's price will rise to that predicted level.
Zone of SupportRefers to a forecasted zone where a security's price will fall to that predicted level.

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Alpha Squared Capital  is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Alpha Squared Capital and its representatives are properly licensed or exempt from licensure. This website is solely for informational purposes. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Alpha Squared Capital  unless a client service agreement is in place.