Terms in this set (18)
A type of accounting system that reports income when earned and expenses when incurred.
Repayment of a loan by monetary installments.
The process of buying securities at a low price in one market and then selling them at a higher price in another market.
A hundreth of one percent.
A widespread decline in security prices causes bears to believe share prices will fall. Bears sell securities, which they do not presently own, hoping they can buy them at a lower price later after the price has fallen.
A large and creditworthy company
Interest earned on the principal amount and then accumulated over time.
Shares that do not recieve income until they have reached a certain level.
Economies of Scale
The decrease of cost per unit that is a direct result from and increase in production. This can be accomplished because as production increases, the cost of producing each additional item falls. Businesses often buy in volume to take advantage of the discounted rates due to economies of scale.
Buying one security and selling another with the goal of reducing risk.
Insurance designed to protect a mortgage lender against the risk of the borrower not being able to repay their loan.
A high risk bond.
Trade in short-term and low-risk securities resulting in dividend earnings.
The value of a security when it is first issued.
Stocks and shares
A life insurance policy set up for a certain number of years. If you survive the term policy then you do not recieve any payout.
A business or individual that looks after and manages the assets for the benefit of another.
The annual income recieved expressed as a percentage.
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