Financial Glossary

The lowest price a seller is currently willing to accept for a share. Buying 'at market' fills at the ask price.

A period in which a broad market index falls 20% or more from a recent high, often accompanied by widespread pessimism.

A measure of a stock's volatility relative to the overall market. A beta above 1 means the stock tends to move more than the market.

The highest price a buyer is currently willing to pay for a share. Selling 'at market' fills at the bid price.

Shares of large, financially stable, well-established companies with a long history of reliable performance.

A loan made by an investor to a borrower (often a government or corporation) that pays periodic interest and returns principal at maturity.

A sustained period of rising prices in a market or asset, generally accompanied by investor optimism.

The profit realized when an investment is sold for more than its purchase price. Taxed differently depending on holding period.

Interest calculated on both the initial principal and the accumulated interest from previous periods — growth on growth.

A portion of a company's earnings distributed to shareholders, typically paid quarterly in cash or additional shares.

Annual dividend payments per share divided by the current share price, expressed as a percentage.

Investing a fixed amount of money at regular intervals regardless of price, which averages out the purchase price over time.

A company's net profit divided by its number of outstanding shares — a core measure of profitability per share.

A fund that holds a basket of assets (stocks, bonds, etc.) and trades on an exchange like an individual stock.

The annual fee a fund charges investors, expressed as a percentage of assets, covering management and operating costs.

A fund designed to track the performance of a specific market index, such as the S&P 500, typically at low cost.

The rate at which the general level of prices for goods and services rises, eroding purchasing power over time.

The first sale of a private company's shares to the public, after which the stock trades on an exchange.

An order to buy or sell a security only at a specified price or better — it may not execute if the price isn't reached.

How easily an asset can be bought or sold without significantly affecting its price. Highly traded stocks are highly liquid.

The total market value of a company's outstanding shares, calculated as share price multiplied by total shares.

An order to buy or sell a security immediately at the best currently available price.

A pooled investment vehicle priced once per day at net asset value, managed actively or passively by a fund company.

A stock's share price divided by its earnings per share — a common, though imperfect, valuation metric.

The complete collection of investments held by an individual or institution, including stocks, bonds, cash, and other assets.

The process of buying or selling assets to bring a portfolio back to its target allocation after market movements shift it.

A significant, widespread decline in economic activity lasting more than a few months, often defined as two consecutive quarters of negative GDP growth.

A company that owns or finances income-producing real estate, allowing investors to gain real estate exposure without owning property directly.

An investor's ability and willingness to endure declines in the value of their investments in pursuit of higher returns.

A grouping of companies that operate in the same broad segment of the economy, such as Technology or Healthcare.

Borrowing shares to sell them with the expectation of buying them back later at a lower price, profiting from a decline.

When a company increases its number of outstanding shares by issuing more shares to current holders, lowering the price per share proportionally.

Selling investments at a loss to offset capital gains taxes owed on other investments, while maintaining overall portfolio strategy.

A unique series of letters assigned to a security for trading purposes, such as AAPL for Apple Inc.

The degree of variation in a security's price over time. Higher volatility means larger and more frequent price swings.

A line plotting interest rates of bonds with equal credit quality but differing maturity dates, used as an economic indicator.