Wednesday, February 8, 2012
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Personal Finance Glossary
Frequently Searched Terms
Definition of Appraisal
C
A "C corporation" refers to the federal tax classification of a corporation with respect to how... more
A "cafeteria plan" is an employee benefit plan that allows employees to select among various... more
A "calculation agent" is a professional who determines the value of a derivative security or the... more
A "calendar spread" is an options trading strategy where options are bought and sold on the same... more
"Call date" is the date when an issuer of bonds may retire a portion or all of its outstanding... more
"Call option" is an option contract that gives the holder the right to purchase a set number of... more
A "call premium" refers to either (1) the amount that a call option costs or (2) the price premium... more
A "call price" is the premium (or penalty) a securities (often bonds or preferred stock) issuer... more
"Call protection" is a feature in some callable bonds providing that the bonds may not be redeemed... more
The term "call risk" refers to the risk to a bondholder that a bond may be redeemed (or "called")... more
A "callable bond" is a bond that permits the issuer to redeem the bond before the stated maturity... more
"Called away" refers to a bond that is redeemed prior to its stated maturity date, pursuant to a... more
"Capital" in the financial context means money invested in a company typically through issuance of... more
A "capital appreciation fund" is a mutual fund that seeks maximum capital appreciation through the... more
"Capital asset" is a long term asset such as land or property, not purchased for sale or lease in... more
"Capital cost allowance" is a tax term used for depreciation; in essence, the portion of the cost... more
"Capital expenditures" refers to expenditures used to acquire or improve long-term (or capital)... more
"Capital gain" is the difference between the net sales price of an asset or security and its net... more
A "capital gains distribution" is a distribution to the stockholders of a mutual fund out of... more
A "capital gains tax" is the tax levied on profits from the sale of capital... more
A "capital improvement" is an improvement to property that adds to the value and extends the useful... more
A "capital lease" is a lease obligation that, under applicable accounting practices, has to be... more
"Capital loss" is when an asset or security is sold at a loss, equal to the difference between the... more
"Capital stock" is all ownership shares of a corporation, including common stock and preferred... more
"Capital surplus" is the contribution by shareholders of a corporation in excess of par value of... more
The term "capitalization" has multiple meanings, including: (1) the value of outstanding stock of a... more
"Capitalization rate" is the rate of interest used to calculate the present value of a number of... more
A "capitalization table" of a company displays the capitalization of the company from each... more
"Capitalized interest" is accrued interest which is added to the principal of a loan creating a new... more
The term "carry forwards" generally refers to tax losses allowed to be used to offset taxable... more
A "cash advance" is a cash loan from a credit card using an ATM or bank withdrawal. Interest on the... more
The term "cash and equivalents" refers to cash on a company's balance sheet plus the value of... more
"Cash basis accounting" refers to the accounting method that recognizes revenues and expenses when... more
A "cash discount" often refers to a discount from the purchase price of a good or service, based on... more
A "cash dividend" is a dividend paid in cash to a company's stockholders. The amount is... more
"Cash flow" refers to a company's earnings before depreciation, amortization and non-cash... more
"Cash out refinance" refers to a new mortgage for an existing property which allows the borrower... more
"Cash surrender value" refers to the amount of cash a person may obtain by voluntarily surrendering... more
"Cash value insurance" is a life insurance policy which in addition to providing death benefits... more
The term "cash-on-cash return" refers to the calculation of the rate of return earned on the cash... more
A "cash-out refinance" is the situation where a borrower refinances his mortgage at a higher amount... more
A "cashier's check" is a check issued by a bank where the bank is the sole obligor on the... more
A "cashless exercise" is the exercise of an option by the option holder in a manner that does not... more
"Casualty insurance' is insurance protecting a company or property owner against losses caused... more
A "casualty loss" is a financial loss caused by damage, destruction or loss of property as a result... more
A "collateralized bond obligation" (sometimes referred to as a "CBO") is a bond backed (or... more
The "Chicago Board Options Exchange" is a securities exchange based in Chicago, Illinois for the... more
The "Chicago Board of Trade" is an exchange for financial futures and... more
A "certificate of deposit" or "CD" is a certificate typically usually issued by a bank, credit... more
The "Commodity Exchange Act" or "CEA" is the federal law regulating commodity futures and options... more
The "CEO" or "Chief Executive Officer" is the highest ranking officer of a corporation. He or she... more
A "CEO Employment Agreement" is an agreement containing the employment terms and conditions between... more
A "certificate of deposit" or CD is a certificate typically issued by a bank, credit union or... more
The "Certificate of Incorporation" (or sometimes called the Articles of Incorporation) is the... more
A "certified check" is a check drawn on the account of a person or entity on which a bank has... more
A "certified financial planner" is the designation awarded by the Certified Financial Planner Board... more
The term "certified financial statements" refers to the balance sheet, income statement, and other... more
A "certified public accountant" or "CPA" is an accountant who has met certain standards and passed... more
"CFA" stands for Chartered Financial Analyst, which is a professional designation given by the CFA... more
The "Chief Financial Officer" or "CFO" is the corporate officer often primarily responsible for the... more
The "Commodity Futures Trading Commission" or "CFTC" is a federal agency that regulates exchange... more
"Channel stuffing" is the practice of a company or its sales force in artificially inflating its... more
A "Chapter 11 Bankruptcy" is a category of proceeding under federal bankruptcy laws where a... more
The term "Chapter 13" is a category of proceeding under federal bankruptcy laws. Under Chapter 13,... more
A "Chapter 7 Bankruptcy" is a category of proceeding under federal bankruptcy laws under which the... more
A "charge card" is similar to a credit card, but that charges no interest and requires you to pay... more
A "charge off" is a term often used to indicate that a creditor does not expect to collect the... more
A "chargeback" occurs when a customer disputes a credit card sale by a merchant. When there is a... more
A "charitable donation" is a tangible gift in the form of money or goods to a public or private... more
A "charitable lead trust" is a trust established to pay income to a charity for a specified time... more
A "charitable remainder trust" is an irrevocable trust that pays income to one or more individual... more
A "charter" is the governing document to form a corporation. See "Articles of Incorporation" and... more
A "Chartered Financial Analyst" or "CFA" is a professional designation given by the CFA Institute... more
A "chastity bond" is a bond that becomes immediately due and payable up on the completion of a... more
"Cheap stock" often refers to stock sold by a company prior to its IPO at prices "substantially"... more
A "checking account" is a, account at a bank or similar financial institution (for example, a... more
The "Chicago Board of Trade" or "CBOT" is an exchange for financial futures and... more
The "Chicago Board Options Exchange" or "CBOE" is a securities exchange based in Chicago, Illinois... more
The "CEO" or "chief executive officer" is the highest ranking officer of a corporation. She or he... more
The "chief financial officer" or "CFO" is the corporate officer primarily responsible for the... more
A "chief operating officer" or "COO" is a corporate officer responsible for management of... more
A "child tax credit" is a federal tax credit based on the number of dependent children in a family.... more
The term "churning" refers to excessive securities trading by a stock broker who derives a profit... more
A "classified board" is a corporate Board structure where only a portion of the Board of Directors... more
The term "classified shares" refers to the categorization of company stock into more than one class... more
"Clear title" often refers to title to real property that is free of defects or legal challenges to... more
A "clearing house" is an organization handling the processing of securities that are purchased or... more
The term "cliff vesting" refers to the process of holders of employee stock options vesting (or... more
A "close corporation" is a corporation that elects in its Certificate of Incorporation (or Articles... more
A "closed end fund" is a mutual fund that sells a fixed number of shares in a managed portfolio of... more
The term "closely held" refers to a corporation whose voting stock is held by a few... more
The term "closely held shares" refers to all or a majority of shares in a corporation that are held... more
A "closing bell" is a bell that rings to signify the end of a stock exchange... more
"Closing costs" are the expenses involved in transferring ownership or borrowing against a real... more
A "closing price" is thee price of the last transaction of a particular stock at the end of a... more
A "closing statement" is a statement typically prepared by a title or escrow company in connection... more
The term "closing tick" means the number of stocks on the New York Stock Exchange which closed... more
The term "cloud on title" refers to a defect in the title to real property which prevents the title... more
"Club deals" typically refers to a group of private equity investors who band together to buy out... more
Commercial mortgage-backed securities" or "CMBS" are mortgage backed securities that are backed by... more
A "collateralized mortgage obligation" or "CMO" is a fixed-income investment (bond) backed by... more
The term "co-pay" usually refers to a dollar amount required to be paid by a member of a health... more
A "co-payment" is a specified dollar amount which a member under a health insurance plan must pay... more
A "co-signer" is an additional person who assumes liability for obligations under a loan by... more
The term "COBRA" stands for the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.... more
The term "COFI" stands for the 11th District Cost of Funds Index, an index that is used to... more
"Coinsurance" refers to a type of health insurance policy where the insured pays a set percentage... more
The term "COLA" or "Cost of Living Adjustment" refers to the increase in wages or pension benefits... more
"Collateral" is an asset or real property used as security for... more
A "collateralized bond obligation" (sometimes referred to as a "CBO") is an investment grade bond... more
A "collateralized mortgage obligation" or "CMO" is a fixed-income investment (bond) backed by... more
A "collection agency" is a business that pursues payments on debts owed by individuals or... more
The term "combined loan to value ratio" refers to the total balance of mortgages on a property... more
A "comfort letter" is typically a letter written by an independent accountant to an underwriter or... more
A "commercial letter of credit" is a letter usually issued by a bank that on behalf of a buyer that... more
Commercial mortgage backed securities" or "CMBS" are mortgage backed securities that are backed by... more
"Commercial paper" is a short term unsecured promissory note issued by a company, typically for a... more
The term "commercial real estate" generally refers to properties used for industrial, commercial,... more
The term "commingled fund" refers to a type of mutual fund with assets from multiple accounts that... more
The term "commingling" refers either to (1) the act of mixing money or property that is separate in... more
The term "commission" typically refers to either (1) the fee paid to a stockbroker to execute a... more
A "commitment fee" is the fee charged by the lender to commit itself to a mortgage or loan on... more
A "commodity" is a food, a metal or another physical substance that investors buy or sell,... more
The "Commodity Exchange Act" or "CEA" is the federal law regulating the commodity futures and... more
The "Commodity Futures Trading Commission" or CFTC is a federal agency that regulates exchange... more
"Common stock" is the basic class of stock in a corporation, giving the owner a share of the... more
"Community property" is term describing how some states classify property acquired during a... more
"Comparables" is a real estate term referring to properties which are similar to a particular... more
The term "competitive bid" refers to the price and terms submitted in a sealed bid to an issuer by... more
"Compound interest" refers to the process of adding interest to the principal of a loan and... more
"Compounding" is term often used to describe the process of adding interest to the principal amount... more
A "condominium" is a form of real estate ownership in which each owner has title to a specific unit... more
A "confidentiality agreement" is a contract that contemplates one party disclosing proprietary or... more
A "conforming loan" is a mortgage that meets the requirements for purchase by Fannie Mae or Freddie... more
A "conglomerate" is a term often used to refer to a large corporation that has diversified its... more
A "consent by Lessor" is a legal document where the landlord of leased premises gives his or her... more
A "conservatorship" is a legal process in which an adult is appointed by a court to make financial... more
A "consignment agreement" is a contract where the owner of goods turns them over to a seller (such... more
A "consolidated financial statement" is a financial statement that shows all the assets,... more
The "Consolidated Omnibus Budget Reconciliation Act of 1985", as amended, or "COBRA", is a federal... more
A "construction loan" is a short term loan that is used to finance the construction of homes or... more
The term "construction spending" refers to an economic indicator published on a monthly basis by... more
A "consulting agreement" is a contract between two parties where the "consultant" provides... more
"Consumer credit" is a category of credit that a bank or other lender grants to consumers for the... more
"Consumer durables" refers to consumer products that are expected to last at least three years. ... more
The "Consumer Price Index" or CPI is the monthly measure of prices of consumer goods or services... more
A "contract" is a legally binding agreement between two or more parties to do or not do certain... more
A "contract for sale of goods" is a legal agreement where the seller of goods transfers ownership... more
A "controller" is one of the most senior accountants in a company, responsible for financial books... more
A "conventional mortgage" is a mortgage loan made by a bank or other financial institution without... more
A "convertible ARM" is an adjustable rate mortgage that can be converted into a fixed-rate mortgage... more
A "convertible bond" is a debt obligation of a corporation that can be exchanged for a designated... more
A "convertible debenture" is a debt obligation of a corporation that allows the holder at his... more
"Convertible preferred stock" is a corporation's preferred stock that can be converted into... more
"Convertibles" are securities (generally bonds or preferred stock) that are exchangeable at the... more
A "chief operating officer" or "COO" is a corporate officer responsible for management of... more
The term "cook the books" refers to the fraudulent creation or alteration of a company's... more
A "copyright assignment" is a contract that transfers a copyrighted work from the copyright holder... more
A "corporate bond" is a debt security issued by a corporation obligating the corporation to pay... more
A "corporate charter" is a legal document creating a corporation, such as a Certificate of... more
The term "corporate tax" refers to refers to taxes charged by various jurisdictions (federal,... more
A "corporation" is a legal entity established under state law (and sometimes federal law such as a... more
"Cost basis" is the original price of an asset or property, which is used to ultimately determine... more
The term "cost of debt" refers to the effective rate of interest that a company pays on... more
The "cost of goods sold" is the total costs for buying raw material and other items (including... more
The term "Cost of Living Adjustment" (sometimes abbreviated to "COLA") refers to the increase in... more
A "counter offer" is a seller's response to a buyer's offer where the seller proposes... more
The term "counterparty" refers to the other individual or institution that is party to an... more
A "coupon bond" is a security issued with detachable certificates (the "coupon") entitling the... more
"Coupon payments" are interest payments made under... more
A "covenant" is a legal promise obligating a party to do something. Covenants are typically... more
A "covered call" is trading position where the trader has sold a call option while holding an... more
A "covered put" is a put options position where the option writer is also short the corresponding... more
A "certified public accountant" or "CPA" is an accountant who has met certain standards and passed... more
The "CPI" is short for the Consumer Price Index, which is the monthly measure of consumer goods or... more
The term "credit" has multiple meanings. Credit means the promise to pay in the future in order to... more
A "credit application" is a form to be completed by an applicant for a loan, credit card, or credit... more
"Credit bureaus" are credit reporting agencies. They collect information from creditors and lenders... more
A "credit card" is a plastic card that can be used to buy goods and services on credit. The credit... more
"Credit counseling" is counseling that helps individuals focus on reorganizing outstanding debts... more
"Credit enhancement" is credit support purchased by an issuer to raise the credit rating on a debt... more
"Credit history" is a record showing how a person has borrowed and repaid debt. The credit history... more
A "credit limit" is the maximum amount of money that can be borrowed under a credit card or credit... more
A "credit rating" is an evaluation of the credit worthiness of an individual or business and the... more
A "credit rating agency" is a company that assigns credit ratings for issuers of various debt... more
The term "credit repair" refers to the attempt to improve one's financial reputation... more
A "credit report" is the report maintained by credit bureaus on the borrowing activities and credit... more
A "credit score" is a numerical value that summarizes an individual's creditworthiness at a... more
A "credit union" is a co-operative financial institution that is owned and controlled by its... more
A "creditor" is a person or business that lends money or extends credit. Types of creditors include... more
A "cross default" refers to a clause in a loan or credit agreement that allows the lender to... more
The term "cum dividend" refers to the buyer of a share of stock who is entitled to the next... more
"Cumulative dividends" are dividends on preferred stock of a corporation that accrue if not paid... more
"Cumulative voting" is a procedure used for electing directors in which shareholders are entitled... more
For financial accounting purposes, the term "current assets" refers to assets on the balance sheet... more
"Current liabilities" are amounts owed for salaries, interest, accounts payable and other debts due... more
The term "current market value" often refers to the worth of securities held. To determine the... more
"Current yield" is the rate of return on an investment, expressed as a percentage. For bonds, the... more
"CUSIP" stands for the Committee on Uniform Securities and Identification Procedures, the standards... more
A "CUSIP number" is a nine character number that uniquely identifies a particular security. CUSIP... more
A "custodial account" is on account opened on the behalf of a minor by an adult who acts as... more
Word of the Day
Black Scholes Model
The term "Black Scholes Model" refers to a mathematical model used to determine the...
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