The Dictionary
50 finance terms, defined in plain English. Bookmark this. Send it to your group chat.
Return above the benchmark.
How you split money across asset classes.
Sensitivity to market moves.
A bond's return at current price.
When a company repurchases its own stock.
The right to buy at a set price.
How two assets move together.
The main inflation gauge.
Discounted cash flow valuation.
Existing holders' ownership shrinking.
Spreading risk across many holdings.
Annual dividend as a percent of price.
Investing the same amount on a schedule.
Bond price sensitivity to rates.
Earnings before interest, taxes, depreciation, amortization.
A durable competitive advantage.
Market cap plus debt minus cash.
Net profit per share.
Exchange-traded fund.
Annual fund fee, as a percent of assets.
The Fed's policy interest rate.
Shares actually available to trade.
P/E using next year's estimated earnings.
Cash left after capex.
Revenue minus direct costs, as a percent.
Fund that tracks a market index.
Prices rising over time.
The price of money.
A company's first sale of public stock.
Total dollar value of all shares.
Bottom-line profit.
Product gets more valuable as users grow.
Cash from core operations.
Operating profit as a percent of revenue.
Price per dollar of annual earnings.
Dividends as a share of earnings.
P/E divided by growth rate.
The right to sell at a set price.
Restoring your target allocation.
A meaningful drop in economic activity.
Total sales.
Total shares a company has issued.
Return per unit of total risk.
Shares sold short, as a percent of float.
Rapid price rise as shorts cover.
More shares, lower price.
The market's fear gauge.
How much a price swings.
Blended cost of capital.
Bond yields across maturities.