|Equivalent annual annuity
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Definition of Equivalent annual annuity
Equivalent annual annuity
The equivalent amount per year for some number of years that has a present
The equivalent annual annuity for the net present value of an investment project.
the present value of a finite stream of cash flows for every beginning $1 of cash flow.
For investment companies, the management fee and "other expenses,"
The periodic rate times the number of periods in a year. For example, a 5%
The effective, or true, annual rate of return. The APY is the rate actually
Yearly record of a publicly held company's financial condition. It includes a description of the
If stock X appreciates 1.5% in one month, the annualized gain for that sock over a twelve
The annual rate of return that when compounded t times, would have
A regular periodic payment made by an insurance company to a policyholder for a specified period
An annuity with n payments, wherein the first payment is made at time t = 0 and the last
Present value of $1 paid for each of t periods.
An annuity with a first payment on full period hence, rather than immediately.
Bond yield calculated on an annual percentage rate method. Differs from annual
The method used for computing the bond-equivalent yield.
The annualized yield to maturity computed by doubling the semiannual yield.
Cash and equivalents
The value of assets that can be converted into cash immediately, as reported by a
A short-term security that is sufficiently liquid that it may be considered the financial
Temporary investments of currently excess cash in short-term, high-quality
An amount that would be accepted in lieu of a chance at a possible higher, but
Common stock equivalent
A convertible security that is traded like an equity issue because the optioned
Corporate taxable equivalent
Rate of return required on a par bond to produce the same after-tax yield to
Coupon equivalent yield
True interest cost expressed on the basis of a 365-day year.
Deferred nominal life annuity
A monthly fixed-dollar payment beginning at retirement age. It is nominal
Effective annual interest rate
An annual measure of the time value of money that fully reflects the effects of
Effective annual yield
annualized interest rate on a security computed using compound interest techniques.
Equivalent annual cash flow
annuity with the same net present value as the company's proposed investment.
Equivalent annual cost
The equivalent cost per year of owning an asset over its entire life.
Equivalent bond yield
annual yield on a short-term, non-interest bearing security calculated so as to be
Given the after-tax stream associated with a lease, the maximum amount of conventional
Equivalent taxable yield
The yield that must be offered on a taxable bond issue to give the same after-tax
Also called a busted convertible, a convertible security that is trading like a straight
Nominal annual rate
An effective rate per period multiplied by the number of periods in a year.
Normal annuity form
The manner in which retirement benefits are paid out.
RAMs (Reverse-annuity mortgages)
Mortgages in which the bank makes a loan for an amount equal to a
Single-premium deferred annuity
An insurance policy bought by the sponsor of a pension plan for a single
Stated annual interest rate
The interest rate expressed as a per annum percentage, by which interest
CASH AND CASH EQUIVALENTS
The balance in a companyâ€™s checking account(s) plus short-term or temporary investments (sometimes called â€śmarketable securitiesâ€ť), which are highly liquid.
The report required by the Stock Exchange for all listed companies, containing the companyâ€™s financial statements.
A series of payments or deposits of equal size spaced evenly over
annuity where the payments are to be made at the beginning of
Bond Equivalent Yield
Bond yield calculated on an annual percentage rate method
Effective Annual Yield
annualized rate of return on a security computed using compound
An annuity where the payments are made at the end of each
a series of equal cash flows being received or paid at the beginning of a period
equivalent units of production (EUP)
an approximation of the number of whole units of output that could have been
a series of equal cash flows being received
A series of payments over a period of time. The payments are usually
A report issued to a companyâ€™s shareholders, creditors, and regulatory
annual percentage rate (APR)
Interest rate that is annualized using simple interest.
Equally spaced level stream of cash flows.
Level stream of cash flows starting immediately.
Present value of an annuity of $1 per period.
effective annual interest rate
Interest rate that is annualized using compound interest.
equivalent annual cost
The cost per period with the same present value as the cost of buying and operating a machine.
Individual Retirement Annuity
An IRA comprised of an annuity that is managed
Highly liquid, fixed-income investments with original maturities of three months or less.
A contract which provides an income for a specified period of time, such as a certain number of years or for life. An annuity is like a life insurance policy in reverse. The purchaser gives the life insurance company a lump sum of money and the life insurance company pays the purchaser a regular income, usually monthly.
Back To Back Annuity
This term refers to the simultaneous issue of a life annuity with a non-guaranteed period and a guaranteed life insurance policy [usually whole life or term to 100]. The face value of the life insurance would be the same amount that was used to purchase the annuity. This combination of life annuity providing the highest payout of all types of annuities, along with a guaranteed life insurance policy allowed an uninsurable person to convert his/her RRSP into the best choice of annuity and guarantee that upon his/her death, the full value of the annuity would be paid tax free through the life insurance policy to his family members. However, in the early 1990's, the Federal tax authorities put a stop to the issuing of standard life rates to rated or uninsurable applicants. Insuring a life annuity in this manner is still an excellent way to provide guaranteed tax free funds to family members but the application for the annuity and the application for the life insurance are separate transactions and today, most likely conducted through two different insurance companies so that there is no suspicion of preferential treatment given to the life insurance application.
An annuity providing for income payments to commence at a specified future time.
Instruments or investments of such high liquidity and safety that they are virtually equal to cash.
The fund return, for any 12-month period, including changes in unit value and the reinvestment of distributions, but not taking into account sales, redemption, distribution or other optional charges or income taxes payable by any unitholder that would reduce returns.
Yearly amount payable by a client for a policy or component.
Periodic payments made to an individual under the terms of the policy.
The time between each payment under an annuity.
Guaranteed Interest Annuity (GIA)
Interest bearing investment with fixed rate and term.
A form of annuity policy under which the amount of each benefit is not guaranteed or specified. The amounts fluctuate according to the earnings of a separate investment account.
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