Financial Terms Main Page

This site contains comprehensive definitions for a wide range of terms that cover topics such as financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit...

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Accelerated depreciation

Any depreciation method that produces larger deductions for depreciation in the
early years of a project's life. Accelerated cost recovery system (ACRS), which is a depreciation schedule
allowed for tax purposes, is one such example.

Fedwire

A wire transfer system for high-value payments operated by the Federal Reserve System.

Informationless trades

Trades that are the result of either a reallocation of wealth or an implementation of an
investment strategy that only utilizes existing information.

Limited partner

A partner who has limited legal liability for the obligations of the partnership.

Money management

Related: Investment management.

Open-market purchase operation

A systematic program of repurchasing shares of stock in market
transactions at current market prices, in competition with other prospective investors.

Risk neutral

Insensitive to risk.

Overhead

Any cost other than a direct cost – may refer to an indirect production cost and/or to a non-production expense.

outsourcing decision

see make-or-buy decision

procurement card

a card given to selected employees as a
means of securing greater control over spending and eliminating
the paper-based purchase authorization process

international Fisher effect

Theory that real interest rates in all countries should be equal, with differences in nominal rates reflecting differences in expected inflation.

underpricing

Issuing securities at an offering price set below the true value of the security.

Cash Equivalents

Highly liquid, fixed-income investments with original maturities of three months or less.

Failure analysis

The examination of failure incidents to identify components
with poor performance profiles.

Face Value

The nominal value which appears on the face of a document recording an entitlement, generally an amount of money that has to be repaid on the maturity of a debt instrument.