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Investments glossary

Paradox Of Thrift

The paradox of thrift, or paradox of savings, is an economic theory which posits that personal savings are a net drag on the economy during a recession. This theory relies on the assumption that prices do not clear or that producers fail to adjust read more

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Investments glossary

Quantity-Adjusting Option (Quanto Option)

A quantity-adjusting option, also known as a Quanto option, is a cash-settled, cross-currency derivative, where the underlying asset is denominated in a currency other than the currency in which the option is settled.

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Investments glossary

Lifetime Cost Definition

Lifetime cost is the total of all other expenses relating to a good, like a car or a home, over the expected life of the product. The sum of the lifetime cost includes the amount paid to purchase the item.

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Investments glossary

Time Deposit

A time deposit is an interest-bearing bank account that has a pre-set date of maturity. A certificate of deposit (CD) is the best-known example. The money must remain in the account for the fixed term in order to earn the stated interest rate.

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Investments glossary

Indexing

Indexing is broadly referred to as an indicator or measure of something. In the financial markets, indexing can be used as a statistical measure for tracking economic data, a methodology for grouping a specific market segment or as an investment management read more

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Investments glossary

Real Estate Investment Trust (REIT)

A real estate investment trust (REIT) is a company that owns, operates, or finances income-generating real estate. Modeled after mutual funds, REITs pool the capital of numerous investors. This makes it possible for individual investors to earn dividends read more

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Investments glossary

Transparency

Although the term transparency is not a financial term or metric per se, it has become increasingly important to consumers and investors over the last several years. Transparency is the extent to which investors have ready access to required financial read more

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Investments glossary

FANG Stocks

In finance, the acronym FANG refers to the stocks of four prominent American technology companies: Facebook (F), Amazon (AMZN), Netflix (NFLX), and Alphabet (GOOG). In 2017, the company Apple (AAPL) was also added, causing the acronym to be rewritten read more

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Investments glossary

Bank

A bank is a financial institution licensed to receive deposits and make loans. Banks may also provide financial services such as wealth management, currency exchange, and safe deposit boxes. There are several different kinds of banks including retail read more

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Investments glossary

Dow Theory

The Dow theory is a financial theory that says the market is in an upward trend if one of its averages (i.e. industrials or transportation) advances above a previous important high and is accompanied or followed by a similar advance in the other average. read more