Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
Main Page: inventory, money, financial advisor, finance, credit, investment, payroll, inventory control,
Definition of Investment
The commitment of funds (capital) in anticipation of an increased
The use of capital to create more money through the addition of fixed assets or through income producing vehicles.
Refers to various techniques and procedures
Money used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses.
Automatic reinvestment of shareholder dividends in more shares of a
Through equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock.
The return one can expect to earn on an investment. See: capital asset
The acquisition abroad of physical assets such as plant and equipment, with
The options to identify additional, more valuable investment opportunities
A GIC is an investment that gives you a guaranteed rate of return over a fixed period of time, usually between 30 days and 5 years. GICs are available from banks, trust companies, and other financial institutions.
A pure investment product in which a life company agrees, for a
Related: financial analysts
Financial intermediaries who perform a variety of services, including aiding in the sale of
Middleman between a corporation issuing new securities and the public. The middleman buys the securities issue outright and then resells it to customers. Also called an underwriter.
a responsibility center in which the manager
A division or unit of an organization that is responsible for achieving an adequate return on
a judgment about which assets will be
Decisions concerning the asset side of a firm's balance sheet, such as the decision to
Bonds rated Baa or above by Moody’s or BBB or above by Standard & Poor’s.
Investment grade bonds
A bond that is assigned a rating in the top four categories by commercial credit
The revenue from a portfolio of invested assets.
Also called a portfolio manager and money manager, the individual who manages a
Investment product line (IPML)
The line of required returns for investment projects as a function of beta
Expenditures on capital goods including new housing. Financial ''investments" and sales of existing assets are not included.
Investment tax credit
Proportion of new capital investment that can be used to reduce a company's tax bill
Investment Tax Credit
A reduction in taxes offered to firms to induce them to increase investment spending.
A closed-end fund regulated by the investment Company Act of 1940. These funds have a
As a discipline, the study of financial securities, such as stocks and bonds, from the investor's
investments that a regulated entity is permitted to make under the rules and regulations
Mutually exclusive investment decisions
investment decisions in which the acceptance of a project
Gross, or total, investment minus depreciation.
investment spending minus depreciation.
Net present value of future investments
The present value of the total sum of NPVs expected to result from
Passive investment management
Buying a well-diversified portfolio to represent a broad-based market
Passive investment strategy
See: passive management.
the process of gathering information
qualified investments (Canada)
Qualified investments is the term used for investments that can be held in an RSP. These investments generally include:
Regular Investment Plan (RIP)
A plan under which you may make regular deposits of the same amount to your Mutual Funds account once a month, once every 2 weeks, or once a week. You can also make regular deposits up to four times a month on any dates you choose.
an assumption made about the rates of return that will be earned by intermediate cash flows from a capital project; NPV and PI assume reinvestment at the discount rate; IRR assumes reinvestment at the IRR
The rate at which an investor assumes interest payments made on a debt security can be
The risk that proceeds received in the future will have to be reinvested at a lower potential
REIT (real estate investment trust)
Real estate investment trust, which is similar to a closed-end mutual
REMIC (real estate mortgage investment conduit)
A pass-through tax entity that can hold mortgages
return on investment
a ratio that relates income generated
Return on investment (ROI)
Generally, book income as a proportion of net book value.
RETURN ON INVESTMENT (ROI)
In its most basic form, the rate of return equals net income divided by the amount of money invested. It can be applied to a particular product or piece of equipment, or to a business as a whole.
Return on investment (ROI)
The net profit after tax as a percentage of the shareholders’ investment in the business.
return on investment (ROI)
A very general concept that refers to some
Short-term investment services
Services that assist firms in making short-term investments.
The mirror image of the asset substitution problem, wherein stockholders refuse
Unit investment trust
Money invested in a portfolio whose composition is fixed for the life of the fund.
A portfolio of zero net value established by buying and shorting component
The option of terminating an investment earlier than originally planned.
Accounting rate of return (ARR)
A method of investment appraisal that measures
accounting rate of return (ARR)
the rate of earnings obtained on the average capital investment over the life of a capital project; computed as average annual profits divided by average investment; not based on cash flow
Short-term, non-interest-bearing debts owed to a
Income that has been earned but not yet received. For instance, if you have a non-registered Guaranteed investment Certificate (GIC), Mutual Fund or Segregated Equity Fund, growth accrues annually or semi-annually and is taxable annually even though the gain is only paid at maturity of your investment.
acid test ratio (also called the quick ratio)
The sum of cash, accounts receivable, and short-term marketable
Adjusted present value (APV)
The net present value analysis of an asset if financed solely by equity
Process in corporate financial planning whereby the smaller investment proposals of each of the
Annual fund operating expenses
For investment companies, the management fee and "other expenses,"
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.
Formal request for funds for capital investment project.
The weighting of assets in an investment portfolio among different asset classes (e.g. shares, bonds, property, cash, overseas investments.
A debt or equity security not classified as a held-to-maturity security or a trading security. Can be classified as a current or noncurrent investment depending on the intended holding period.
Average accounting return
The average project earnings after taxes and depreciation divided by the average
An investment company that invests in stocks and bonds. The same as a balanced mutual fund.
A short-term credit investment created by a non-financial firm and guaranteed by a
The performance of a predetermined set of securities, for comparison purposes. Such sets may be
The return an investment manager is compared to for performance evaluation.
Book yield is the investment income earned in a year on a portfolio of assets purchased over a number of years and at different interest rates, divided by the book value of those assets.
A guaranteed investment contract purchased with a single (one-shot) premium. Related:
A passive investment strategy with no active buying and selling of stocks from the
The combination of cash flow uncertainty and reinvestment risk introduced by a call provision.
The shareholders’ investment in the business; the difference between the assets and liabilities
A very broad term rooted in economic theory and referring to
The investment by a company’s owners in a business, plus the impact of any
Net result of public and private international investment and lending activities.
management’s plan for investments in longterm
List of planned investment projects.
Refers generally to analysis procedures for ranking
The process of ranking and selecting investment alternatives and
Refers to investments by a business in long-term
The positive difference between the adjusted cost base of an investment held as a capital property and the proceeds of disposition you receive when you sell it. When you sell such an investment for more than you paid, you realize a capital gain.
The negative difference between the adjusted cost base of an investment held as a capital property and the proceeds of disposition you receive when you sell it. When you sell such an investment for less than you paid, you incur a capital loss.
The market in which savings are made available to those needing funds to undertake investment projects. A financial market in which longer-term (maturity greater than one year) bonds and stocks are traded.
Placing one or more limits on the amount of new investment undertaken by a firm, either
Limit set on the amount of funds available for investment.
Refers to recouping, or regaining, invested capital over
Costs that increase with increases in the level of investment in current assets.
CASH AND CASH EQUIVALENTS
The balance in a company’s checking account(s) plus short-term or temporary investments (sometimes called “marketable securities”), which are highly liquid.
Temporary investments of currently excess cash in short-term, high-quality
Highly liquid, fixed-income investments with original maturities of three months or less.
Instruments or investments of such high liquidity and safety that they are virtually equal to cash.
In investments, it represents earnings before depreciation , amortization and non-cash charges.
In investments, NET INCOME plus DEPRECIATION and other noncash charges. In this sense, it is synonymous with CASH EARNINGS. Investors focus on cash flow from operations because of their concern with a firm's ability to pay dividends.
Cash Flow Provided or Used from Financing Activities
Cash receipts and payments involving
Cash Flow Provided or Used from Investing Activities
Cash receipts and payments involving
Cash value added (CVA)
A method of investment appraisal that calculates the ratio of the net present value of an
Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.