List of common investment jargons:
1. Bull Market: A period where stock prices are rising or expected to rise.
2. Bear Market: A period of declining stock prices.
3. Diversification: Spreading investments across various assets to reduce risk.
4. Portfolio: A collection of financial assets held by an investor.
5. Asset Allocation: The strategy of dividing investments among different asset categories.
6. Yield: The income return on an investment, usually expressed as a percentage.
7. Capital Gains: Profits earned from selling an asset at a higher price than purchased.
8. Dividend: A portion of a company’s earnings distributed to shareholders.
9. Market Capitalization: The total market value of a company’s outstanding shares.
10. Index Fund: A mutual fund that aims to replicate the performance of a specific index.
Additional complex investment jargons:
1. Arbitrage: Taking advantage of price differences in different markets.
2. At-the-money: An option with a strike price equal to the current market price.
3. Bear Trap: A false signal that the market is about to decline.
4. Bid-Ask Spread: The difference between the buying price and selling price of an asset.
5. Blue Chip: A well-established company with a history of reliable earnings.
6. Book Value: The value of a company’s assets minus its liabilities.
7. Capitalization: The total value of a company’s outstanding shares.
8. Churning: Excessive buying and selling of stocks to generate commissions.
9. Cyclical Stocks: Stocks whose performance is closely tied to economic cycles.
10. Defensive Stocks: Stocks that provide stable returns regardless of market conditions.
11. Dollar-Cost Averaging: Investing a fixed amount regularly regardless of price fluctuations.
12. Emerging Markets: Countries with developing economies that offer growth potential.
13. Fundamental Analysis: Analyzing a company’s financial health to make investment decisions.
14. Growth Stocks: Stocks expected to grow at an above-average rate.
15. Index: A statistical measure of the change in a securities market.
16. Initial Margin: The percentage of the purchase price of securities that an investor must pay for with his/her own cash.
17. Leverage Ratio: A financial ratio that measures the degree to which a company is using borrowed money.
18. Liquidity: The ease with which an asset can be converted into cash.
19. Market Order: An order to buy or sell a stock at the current market price.
20. Payout Ratio: The proportion of earnings paid out as dividends to shareholders.
21. Position Trading: A long-term trading strategy where an investor holds onto a security for an extended period.
22. Price Action: The movement of a security’s price over time.
23. Private Equity: Investment in private companies not listed on public exchanges.
24. Put Option: A contract that gives the holder the right to sell an asset at a specified price.
25. Risk Appetite: The amount of risk an investor is willing to take.
26. Short Selling: Selling an asset that an investor does not own, betting that its price will fall.
27. Sovereign Debt: Bonds issued by a national government.
28. Spread: The difference between the bid price and the ask price.
29. Technical Analysis: Analyzing price movements and patterns to forecast future price movements.
30. Value Stocks: Stocks trading at a lower price than their intrinsic value.
31. Volatility: A statistical measure of the dispersion of returns for a given security.
32. Wealth Management: Financial services that provide advice to affluent clients.
33. Yield Curve: A graph that plots interest rates against the maturity dates of debt.
34. Zero-Coupon Bond: A bond that does not pay interest but is sold at a discount.
35. Alternative Investment: Investments outside of traditional stocks and bonds, such as real estate or commodities.
36. Behavioral Finance: The study of the psychology behind investors’ decisions.
37. Credit Risk: The risk of default on a debt that may arise from a borrower failing to make required payments.
38. Emerging Technologies: New technologies that have the potential to create significant impact on industries.
39. Futures Contract: An agreement to buy or sell an asset at a future date at a predetermined price.
40. Hedge Fund: A pooled investment fund that employs various strategies to earn active returns.
41. Inflation Risk: The risk that inflation will erode the purchasing power of an investment.
42. Junk Bonds: High-yield bonds with a lower credit rating.
43. KPI: Key Performance Indicator, used to measure the success of an investment.
44. Liquidity Risk: The risk of not being able to sell an asset quickly without a loss in value.
45. Market Capitalization: The total market value of a company’s outstanding shares.
46. Net Asset Value: The value of an entity’s assets minus its liabilities.
47. Outperform: When a security is expected to perform better than the market average.
48. Preferred Stock: A class of ownership in a corporation with a higher claim on assets and earnings than common stock.
49. Quote: The current price of a security.
50. Redemption: The return of an investor’s principal investment.
51. Sales Ratio: A valuation metric for a company calculated by dividing its market capitalization by its annual sales.
52. Trailing Stop: A stop order that moves with the market price.
53. Unit Investment Trust: An investment company that offers a fixed portfolio of securities.
54. Venture Capital: Financing provided to startups and small businesses with perceived long-term growth potential.
55. Warrant: A security that gives the holder the right to purchase shares at a specific price.
56. X-efficiency: A measure of a firm’s ability to produce at minimum cost.
57. Yield Spread: The difference between yields on different debt instruments.
58. Z-Score: A financial model that measures a company’s financial health.
59. Blue Chip Stocks: Shares in large, reputable, and financially sound companies.
60. Contingent Liability: A potential liability that may occur depending on the outcome of a future event.
61. Exit Strategy: A planned approach to terminating a situation in a way that minimizes losses.
62. Fiduciary Duty: An obligation to act in the best interest of another party.
63. Gearing: The ratio of a company’s debt to its equity.
64. Inflation Hedge: An investment that is expected to maintain or increase its value over time despite inflation.
65. Juvenile Stocks: Stocks of young companies expected to grow rapidly.
66. Kickback: A payment made to someone in return for facilitating a transaction.
67. Liquidity Trap: A situation in which interest rates are low and savings rates are high, rendering monetary policy ineffective.
68. Market Risk: The risk of losses in positions arising from movements in market prices.
69. Non-Performing Asset: A loan or advance for which the principal or interest payment remains overdue.
70. Operating Margin: A measure of profitability calculated as operating income divided by revenue.
71. Phantom Stock: A form of employee compensation that gives the employee the benefits of stock ownership without actually issuing shares.
72. Quantitative Easing: An unconventional monetary policy used by central banks to stimulate the economy.
73. Regulatory Risk: The risk of a change in laws and regulations that can adversely affect an investment.
74. Sharpe Ratio: A measure of risk-adjusted return.
75. Tangible Assets: Physical assets that can be touched, such as machinery or buildings.
76. Underwriting: The process by which an individual or institution takes on financial risk for a fee.
77. Volatility Index (VIX): A measure of the market’s expectations for future volatility.
78. Weighted Average: An average that takes into account the varying degrees of importance of the numbers in the dataset.
79. Yield to Call: The yield of a bond if you were to buy it and hold it until the call date.
80. Zero-Sum Game: A situation in which one participant’s gains are balanced by another’s losses.
81. Arbitrage Fund: A type of mutual fund that attempts to profit from price discrepancies between markets.
82. Cyclical Investing: Investment strategy that focuses on sectors expected to outperform during economic cycles.
83. Debt-to-Income Ratio: A measure used by lenders to determine the ability to repay loans.
84. Efficient Market Hypothesis: Theory that all known information is already reflected in stock prices.
85. Fund of Funds: An investment strategy that involves investing in other funds rather than directly in stocks or bonds.
86. Growth at a Reasonable Price (GARP): An investment strategy that combines growth and value investing principles.
87. Hedging: Making an investment to reduce the risk of adverse price movements.
88. Illiquid Investment: An asset that cannot be easily sold or exchanged for cash without a substantial loss in value.
89. Joint Venture: A business arrangement where two or more parties agree to pool their resources for a specific goal.
90. Knowledge-Based Assets: Assets based on intellectual capital rather than tangible resources.
Some common acronyms used in the investment world:
1. ETF – Exchange-Traded Fund
2. IPO – Initial Public Offering
3. NAV – Net Asset Value
4. ROE – Return on Equity
5. ROI – Return on Investment
6. P/E – Price-to-Earnings Ratio
7. SEC – Securities and Exchange Commission
8. 401(k) – A type of retirement savings plan in the U.S.
9. HSA – Health Savings Account
10. SIP – Systematic Investment Plan
11. AUM – Assets Under Management
12. CAGR – Compound Annual Growth Rate
13. CFP – Certified Financial Planner
14. CFA – Chartered Financial Analyst
15. DCA – Dollar-Cost Averaging
16. DRIP – Dividend Reinvestment Plan
17. EPS – Earnings Per Share
18. ETN – Exchange-Traded Note
19. GARP – Growth at a Reasonable Price
20. GEM – Global Emerging Markets
21. M&A – Mergers and Acquisitions
22. MVP – Minimum Viable Product
23. P&L – Profit and Loss
24. REIT – Real Estate Investment Trust
25. RFP – Request for Proposal
26. ROA – Return on Assets
27. RMD – Required Minimum Distribution
28. S&P – Standard & Poor’s
29. SEC – Securities and Exchange Commission
30. TARP – Troubled Asset Relief Program
31. TIPS – Treasury Inflation-Protected Securities
32. VIX – Volatility Index
33. YTM – Yield to Maturity
34. ADR – American Depositary Receipt
35. ALPHA – Measure of an investment’s performance relative to a benchmark
36. BETA – Measure of an investment’s volatility relative to the market
37. CD – Certificate of Deposit
38. CPI – Consumer Price Index
39. EBIT – Earnings Before Interest and Taxes
40. FOMC – Federal Open Market Committee
41. GAAP – Generally Accepted Accounting Principles
42. GDP – Gross Domestic Product
43. HPR – Holding Period Return
44. IBR – Interest-Based Rate
45. ISIN – International Securities Identification Number
46. KYC – Know Your Customer
47. LEVERAGE – Using borrowed capital for investment
48. LOI – Letter of Intent
49. MACD – Moving Average Convergence Divergence
50. MBS – Mortgage-Backed Securities
51. NIM – Net Interest Margin
52. NPV – Net Present Value
53. P/B – Price to Book Ratio
54. PPI – Producer Price Index
55. RWA – Risk-Weighted Assets
56. SBA – Small Business Administration
57. SDR – Special Drawing Rights
58. SME – Small and Medium Enterprises
59. SPAC – Special Purpose Acquisition Company
60. SWOT – Strengths, Weaknesses, Opportunities, Threats
61. TA – Technical Analysis
62. TRO – Trading Revenue Opportunity
63. U.S. Treasuries – Government debt securities
64. WACC – Weighted Average Cost of Capital
65. WIP – Work in Progress
66. 401(k) – Retirement savings plan in the U.S.
67. 529 Plan – Education savings plan
68. BID – Buy-In Discount
69. CBOE – Chicago Board Options Exchange
70. CPI – Consumer Price Index
71. DOL – Department of Labor
72. EFT – Electronic Funds Transfer
73. ETF – Exchange-Traded Fund
74. FANG – Facebook, Amazon, Netflix, Google
75. GIC – Guaranteed Investment Certificate
76. LTV – Loan to Value
77. MVP – Minimum Viable Product
78. NSFR – Net Stable Funding Ratio
79. OTC – Over The Counter
80. PIF – Public Investment Fund
81. QIB – Qualified Institutional Buyer
82. REPO – Repurchase Agreement
83. SGL – Standard Growth Listed
84. Venture Cap – Venture Capital
85. YTD – Year To Date
86. CPI – Consumer Price Index
87. SWIFT – Society for Worldwide Interbank Financial Telecommunication
88. UNSWF – United Nations Social Impact Fund
89. XIRR – Extended Internal Rate of Return
90. Z-score – Statistical measurement of a score’s relationship to the mean