Financial Glossary
A comprehensive guide to the terminology and concepts driving the global markets.
A
- Alpha
- A measure of the active return on an investment compared to a market index or benchmark.
B
- Bear Market
- A market condition in which the prices of securities are falling, usually defined by a drop of 20% or more from recent highs.
- Bull Market
- A financial market in which prices are rising or are expected to rise continually.
D
- Dividend
- A distribution of a portion of a company's earnings, decided by the board of directors, paid to a class of its shareholders.
E
- ETF (Exchange-Traded Fund)
- A type of pooled investment security that operates much like a mutual fund but trades on an exchange like a regular stock.
F
- Float
- The regular shares a company has issued to the public that are available for investors to trade.
M
- Margin
- The money borrowed from a broker to purchase an investment and is the difference between the total value of the investment and the loan amount.
O
- Options
- Financial derivatives that give buyers the right, but not the obligation, to buy or sell an underlying asset at an agreed-upon price and date.
S
- Short Selling
- An investment or trading strategy that speculates on the decline in a stock or other security's price.
Y
- Yield
- The income returned on an investment, such as the interest received from holding a bond or the dividends from owning stock.