click below
click below
Normal Size Small Size show me how
Discrete
Term | Definition |
---|---|
Capital Gain | the amount of money one can earn by selling their assets |
Hedging | the compromise between buyer and seller towards the price they will buy/sell a commody in the future |
Total Rate of Return | total return on all investments, (capital gain + dividends) |
Diversification | diversifying the assets you invest in |
mutual fund | a pool of money from different investors |
Call | and option type where the stock is prefered to increasing in price |
put | an option type where the stock price is prefered to decrease |
Short | A party obligated to sell the commoditie |
Commodities | Goods bought and sold in bulk |
Coupon Rate | Intrest rate for a bonds periodic interest payment |
long | a party obligated to buy a commodity |
Initial Margin | Money put upfront in buying a commodity |
Compounding Frequency | The number of times interest is paid out in a given amount of time |
simple interest | an interest charge that borrowers pay lenders |
Rule of 72 | time it takes for money to double |
Effective interest rates | takes into account the compounding period |
Nomional rate | does not take into account the compounding period |
Continous compounding | compounding and reinvesting interest over an infinite amount of periods |
Law enforcing APY | Regulation Z |
Annuity | the collection of equal payments made at regular time intervals |
Present Value Annuity | A sum of money is payed upfront and the annuity payments and interest build to pay it off |
Future Value Annuity | A sum of money totals by the annuity payments and interest over a given amount of time |
Annuity Due | The annuity payments are made at the begining of each period |
Annuity Ordinary | The annuity payments are made at the end of each period |
Sinking Fund | Money set aside to pay of a debt or bond |
Interest Rate | A percentage of the principle charged by the lender to use the money |
Creditor | The person who lends the money |
Principle | Amount borrowed or loaned |
Debtor | Person who borrows money |
term | the amount of time in which the loan is made |
Promissary note | a written agreement setting the terms of a loan |