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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Ex-dividend

This literally means "without dividend." The buyer of shares when they are quoted ex-dividend
is not entitled to receive a declared dividend.

Invoice

Bill written by a seller of goods or services and submitted to the purchaser.

Net assets

The difference between total assets on the one hand and current liabilities and noncapitalized longterm
liabilities on the other hand.

OPEC (Organization of Petroleum Exporting Countries)

A cartel of oil-producing countries.

Open position

A net long or short position whose value will change with a change in prices.

Outstanding share capital

Issued share capital less the par value of shares that are held in the company's treasury.

Right

A short-lived (typically less than 90 days) call option for purchasing additional stock in a firm, issued
by the firm to all its shareholders on a pro rata basis.

Theta

Also called time decay, the ratio of the change in an option price to the decrease in time to expiration.

Double entry

The system of recording business transactions in two accounts.

Annuity

A series of payments or deposits of equal size spaced evenly over
a specified period of time

coefficient of determination

a measure of dispersion that
indicates the “goodness of fit” of the actual observations
to the least squares regression line; indicates what proportion
of the total variation in y is explained by the regression model

financial incentive

a monetary reward provided for performance
above targeted objectives

weighted average cost of capital

a composite of the cost of the various sources of funds that comprise a firm’s capital structure; the minimum rate of return that must be earned on new investments so as not to dilute shareholder value

Chart of accounts

A listing of all accounts used in the general ledger, usually sorted in
order of account number.

Marginal Tax Rate

Percent of an increase in income paid in tax.