J-Curve – A graphical representation of how returns on an investment may initially decline before rising significantly, often used in private equity or emerging markets.
Japanese Candlestick – A style of financial chart used to describe price movements of securities, which helps investors analyze market trends.
Jobless Claims – A measure of the number of people filing for unemployment benefits, used as an economic indicator of labor market health.
Joint Account – A financial account shared by two or more individuals, typically allowing each person equal access to the funds and joint responsibility.
Joint Tenancy – A form of property ownership where two or more people share equal rights and survivorship, meaning ownership passes to the surviving owner(s) upon death.
Joint Venture – A business arrangement where two or more parties agree to combine resources for a specific project or business activity, often affecting company valuation and investment opportunities.
Judgment Lien – A legal claim on an individual’s property as a result of a court ruling, which can affect an investor’s assets or creditworthiness.
Junior Debt – A type of debt that is lower in repayment priority in the event of a bankruptcy or liquidation, often offering higher interest rates to compensate for increased risk.
Junk Bond – A high-yield, high-risk bond with a lower credit rating (below investment grade), offering higher returns to compensate for the increased risk of default.
Junket – While more common in travel and entertainment, in financial contexts it may refer to questionable or unethical business-related expenditures that could be scrutinized by investors or regulators.
Jurisdiction Risk – The potential investment risk arising from the legal and regulatory environment of a particular country or region.
Just-In-Time (JIT) Inventory – A business strategy to increase efficiency by receiving goods only as they are needed in the production process, which can impact a company’s financial metrics.
K-1 (Schedule K-1) – A tax document used to report income, deductions, and credits from partnerships, S-corporations, and certain trusts to individual partners or shareholders.
Kagi Chart – A type of technical analysis chart used to track price movements and shifts in supply and demand, without regard to time intervals.
Key Performance Indicator (KPI) – A measurable value that indicates how effectively a company is achieving its business objectives, often used in investment analysis.
Key Rate Duration – A measure of how sensitive a bond’s price is to changes in interest rates at specific maturity points along the yield curve.
Kickback – An illegal or unethical payment received in return for facilitating a transaction, which can distort investment decisions or financial reporting.
Kicker – A feature in a financial instrument that provides additional benefits to the holder, such as a warrant or bonus payment, often used to make a deal more attractive.
Kiting – A form of bank fraud that exploits the time delay between issuing and clearing checks to artificially inflate account balances.
Know Your Customer (KYC) – A regulatory process financial institutions use to prevent fraud, money laundering, or financing of terrorism.
Knock-In Option – A type of barrier option that only becomes active (or “knocks in”) when the underlying asset reaches a certain price.
Knock-Out Option – A type of barrier option that becomes void if the underlying asset hits a specified price level, effectively limiting the risk or duration of the option.
Knowledge Capital – Intangible assets such as intellectual property that contribute to a company’s long-term value and competitiveness.
Knowledge Economy – An economy where growth is primarily driven by the production and use of knowledge and information rather than traditional industrial or agricultural means.
Laddering – An investment strategy that involves purchasing multiple bonds or CDs with different maturity dates to manage interest rate risk and maintain liquidity.
Large-Cap Stock – Shares of a company with a large market capitalization, typically over $10 billion, known for stability and lower volatility.
Last Trading Day – The final day on which a futures contract or option can be traded before it expires.
Late-Day Trading – An illegal practice of placing mutual fund orders after the market has closed but receiving the same-day price, giving an unfair advantage.
Leaseback – A financial arrangement where a company sells an asset and leases it back from the buyer, allowing continued use without ownership.
Leverage – The use of borrowed capital to increase the potential return on investment, which also increases potential risk.
Liability – A company’s legal financial obligations, such as loans or accounts payable, that must be settled in the future.
Limit Order – An order to buy or sell a security at a specific price or better; offers price control but may not be executed.
Liquidity – The ease with which an asset can be quickly converted into cash without significantly affecting its price.
Listed Security – A financial instrument that is traded on a recognized stock exchange and meets its listing requirements.
Load Fund – A mutual fund that charges a commission or sales fee, either at the time of purchase (front-end load) or when sold (back-end load).
Long Position – The ownership of a security with the expectation that its value will increase, allowing it to be sold later at a profit.
Macroeconomics – The branch of economics that studies the overall functioning and indicators of an economy, including GDP, inflation, and unemployment.
Managed Fund – An investment fund that is actively managed by a professional fund manager who makes decisions about asset allocation and security selection.
Management Fee – A fee paid by investors to fund managers for managing an investment fund, typically expressed as a percentage of assets under management.
Margin – Borrowed money that investors use to buy securities, which can amplify gains but also increases the risk of losses.
Margin Call – A broker’s demand for an investor to deposit additional funds or securities when the value of a margin account falls below the required minimum.
Market Capitalization (Market Cap) – The total value of a company’s outstanding shares of stock, calculated by multiplying the share price by the number of shares.
Market Maker – A firm or individual that actively quotes both buy and sell prices in a security to provide liquidity and facilitate trading.
Market Order – An order to buy or sell a security immediately at the best available current price.
Market Risk – The risk of losses due to overall market movements, such as economic changes, interest rate shifts, or political events.
Maturity Date – The date on which a debt instrument, such as a bond, becomes due and the principal must be repaid to the investor.
Median – A statistical measure representing the middle value in a set of data, used in financial analysis to avoid distortion from extreme values.
Money Market Fund – A type of mutual fund that invests in short-term, high-quality debt instruments, offering liquidity and low risk, often used for parking cash.
NASDAQ – The National Association of Securities Dealers Automated Quotations; a major U.S. stock exchange known for its focus on technology and growth companies.
Naked Option – An options strategy where an investor sells a call or put without owning the underlying asset, exposing them to high risk.
National Debt – The total amount of money owed by a country’s government, typically financed through the issuance of securities like bonds.
Negative Equity – A situation where the value of an owned asset falls below the amount still owed on the loan used to purchase it.
Net Asset Value (NAV) – The per-share value of a mutual fund or ETF, calculated by subtracting liabilities from assets and dividing by the number of shares.
Net Income – The profit a company has after subtracting all expenses, taxes, and costs from total revenue; also called net earnings or the bottom line.
Net Present Value (NPV) – A method of evaluating investment profitability by calculating the present value of expected future cash flows minus the initial investment.
Net Worth – The difference between total assets and total liabilities of an individual or company, used to measure overall financial position.
New Issue – A security offered to the public for the first time, such as through an initial public offering (IPO).
No-Load Fund – A mutual fund that does not charge a commission or sales fee when shares are bought or sold.
Non-Callable Bond – A bond that cannot be redeemed by the issuer before its maturity date, providing more predictable income to investors.
Non-Qualified Dividend – A dividend that does not meet IRS requirements for favorable tax treatment and is taxed at the investor’s ordinary income rate.
Odd Lot – A trade of fewer shares than the standard trading unit, usually less than 100 shares.
Off-Balance Sheet – Assets or liabilities that do not appear on a company’s balance sheet but may still impact its financial health.
Offer Price – The price at which a seller is willing to sell a security; also called the ask price.
Offering Memorandum – A document provided to potential investors detailing the terms and risks of a private placement or security offering.
Offset – A transaction that cancels out or reduces the risk of a previous position, such as selling a contract to offset a prior purchase.
Open-End Fund – A mutual fund that continuously issues and redeems shares at the current net asset value.
Open Interest – The total number of outstanding futures or options contracts that have not been settled.
Option – A financial contract giving the buyer the right, but not the obligation, to buy or sell an asset at a set price within a specific time period.
Option Premium – The price paid by the buyer to the seller (writer) for an options contract.
Order Book – A list of buy and sell orders for a security, organized by price level, maintained by an exchange or broker.
Outperform – When an investment or fund performs better than a benchmark or market average.
Over-The-Counter (OTC) – Trading of securities directly between parties rather than through a centralized exchange.
Par Value – The face value of a bond or stock, representing the amount paid back at maturity for bonds or the nominal value of a share.
Passive Investing – An investment strategy that aims to replicate the performance of a market index rather than actively selecting securities.
Penny Stock – A low-priced, highly speculative stock, typically trading below $5 per share, often with higher risk and lower liquidity.
Performance Fee – A fee paid to a fund manager based on the investment returns generated, usually as a percentage of profits above a benchmark.
Portfolio – A collection of financial assets such as stocks, bonds, and cash held by an investor or institution.
Portfolio Diversification – The practice of spreading investments across various asset classes or sectors to reduce risk.
Portfolio Manager – A professional responsible for managing an investment portfolio and making decisions about asset allocation and security selection.
Preferred Stock – A class of stock with priority over common stock in dividend payments and asset liquidation, often with fixed dividends.
Price-to-Earnings (P/E) Ratio – A valuation ratio calculated by dividing a company’s current share price by its earnings per share, indicating how much investors are willing to pay per dollar of earnings.
Price-to-Book (P/B) Ratio – A valuation metric comparing a company’s market value to its book value, used to assess if a stock is undervalued or overvalued.
Private Equity – Investment in private companies or buyouts of public companies that result in their delisting from public stock exchanges.
Prospectus – A legal document that provides details about an investment offering to potential investors, including risks, financial statements, and company information.
Qualified Dividend – A dividend that meets IRS criteria to be taxed at the lower capital gains tax rate instead of ordinary income rates.
Qualified Institutional Buyer (QIB) – An institutional investor that meets certain criteria allowing it to trade in private placements and other exempt securities.
Qualitative Analysis – The evaluation of non-numerical factors such as management quality, industry conditions, and brand strength in investment decisions.
Quantitative Analysis – The use of mathematical and statistical models to evaluate investments and make trading decisions.
Quantitative Easing (QE) – A monetary policy where central banks purchase government securities to increase money supply and encourage lending and investment.
Quarterly Report – A company’s financial report issued every three months, providing updates on earnings, expenses, and other key metrics.
Quarterly Yield – The income return on an investment, such as dividends or interest, expressed as a percentage on a quarterly basis.
Queue – The order in which buy or sell orders are executed in a market, often based on price and time priority.
Quick Ratio – A liquidity ratio that measures a company’s ability to meet short-term obligations with its most liquid assets, excluding inventory.
Quit Claim Deed – A legal document transferring ownership of property without warranties, often used in real estate transactions.
Quota Share – A type of reinsurance where the reinsurer agrees to accept a fixed percentage of premiums and losses from the ceding company.
Quotation – The latest price at which a security has traded or the current bid and ask prices.
Rate of Return – The gain or loss on an investment over a specified period, expressed as a percentage of the initial investment.
Rating – An evaluation of the creditworthiness of a borrower or the quality of a security, typically assigned by a credit rating agency.
Real Estate Investment Trust (REIT) – A company that owns, operates, or finances income-producing real estate and offers shares to investors.
Real Rate of Return – The rate of return on an investment after adjusting for inflation.
Recession – A period of temporary economic decline characterized by reduced trade, industrial activity, and rising unemployment.
Redeemable Bond – A bond that can be paid off by the issuer before its maturity date, usually at a specified call price.
Redemption – The process by which an investor sells back shares of a mutual fund or redeems a bond at maturity.
Reinvestment Risk – The risk that future proceeds from an investment will be reinvested at a lower interest rate than the original investment.
Residual Income – The income remaining after deducting the cost of capital from net operating profit; used to assess profitability.
Return on Assets (ROA) – A financial ratio that measures how efficiently a company uses its assets to generate profit.
Return on Equity (ROE) – A financial ratio that measures a company’s profitability relative to shareholders’ equity.
Return on Investment (ROI) – A measure of the profitability of an investment, calculated as net profit divided by the initial investment cost.
Risk Premium – The additional return expected by investors for taking on higher risk compared to a risk-free investment.
Risk Tolerance – An investor’s ability and willingness to endure fluctuations in the value of investments
