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...

• Browse terms by the Alphabetical Index:
  1 4 A B C D E F G H I J K L M N O P Q R S T U V W Y Z

• Search terms for definitions using keywords:
  Keyword(s):

Monthly Financial Term Picks:

Asian currency units (ACUs)

Dollar deposits held in Singapore or other Asian centers.

Balanced mutual fund

This is a fund that buys common stock, preferred stock and bonds. The same as a
balanced fund.

Futures contract

Agreement to buy or sell a set number of shares of a specific stock in a designated future
month at a price agreed upon by the buyer and seller. The contracts themselves are often traded on the futures
market. A futures contract differs from an option because an option is the right to buy or sell, whereas a
futures contract is the promise to actually make a transaction. A future is part of a class of securities called
derivatives, so named because such securities derive their value from the worth of an underlying investment.

Insider information

Relevant information about a company that has not yet been made public. It is illegal for
holders of this information to make trades based on it, however received.

Limit price

Maximum price fluctuation
Limitation on asset dispositions A bond covenant that restricts in some way a firm's ability to sell major
assets.

Mean

The expected value of a random variable.

Net cash balance

Beginning cash balance plus cash receipts minus cash disbursements.

Sum-of-the-years'-digits depreciation

Method of accelerated depreciation.

PROFIT

What’s left over after you subtract the cost of goods sold and all your expenses from sales.

manufacturing resource planning (MRP II)

a fully integrated materials requirement planning system that involves
top management and provides a basis for both strategic
and tactical planning

product- (or process-) level cost

a cost that is caused by the development, production, or acquisition of specific products or services

liquidation value

Net proceeds that would be realized by selling the firm’s assets and paying off its creditors.

National Income

GDP with some adjustments to remove items that do not make it into anyone's hands as income, such as indirect taxes and depreciation. Loosely speaking, it is interpreted as being equal to GDP.

Equal Pay Act of 1963

A federal Act requiring that both sexes receive equal pay
in situations where work requires equivalent effort, responsibility, and skills,
performed under similar working conditions.

Risk of Collection

Chance that a borrower or trade debtor will not repay an obligation as promised.