Author Topic: Finance Terminologies  (Read 181 times)

Offline kamruzzaman.bba

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Finance Terminologies
« on: March 08, 2017, 01:18:55 PM »
1. Abnormal ReturnThe difference between an actual return and a benchmark or expected return or normal return based on the market’s return and concern security’s relationship with the market.
2. Accelerated depreciationThe method of depreciation that writes off the cost of a capital asset faster than the write-off under straight-line depreciation method. The three principal methods of accelerated depreciation are (a) sum-ofyears’-digits, (b) double declining balance, and (c) units of production.
3. Accounts payableThe amounts due to suppliers of goods and services of an organization.
4. Accounts receivableAmounts of money owed to a firm by customers who have bought goods or services on credit. A current asset, the accounts receivable amount is also called receivables.
5. Accrual accountingA method of accounting in which revenue is recognized when earned and expenses are recognized when incurred without regard to the timing of cash receipts and expenditures. Antithesis of cash basis accounting.
Md. Kamruzzaman Didar
Sr. Lecturer, Department of Business Administration
Faculty of Business & Entrepreneurship

Offline MD. ABDUR ROUF

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Re: Finance Terminologies
« Reply #1 on: March 08, 2017, 05:07:46 PM »
Thanks
Dr. Md. Abdur Rouf
Assistant Professor of Accounting
Faculty of Business and Economics
Daffodil International University

Offline kamruzzaman.bba

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Re: Finance Terminologies
« Reply #2 on: March 09, 2017, 12:46:17 PM »
Sir
Thank you
Md. Kamruzzaman Didar
Sr. Lecturer, Department of Business Administration
Faculty of Business & Entrepreneurship

Offline kamruzzaman.bba

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Re: Finance Terminologies
« Reply #3 on: March 09, 2017, 12:46:38 PM »
Finance Terminologies- Cont.

6.Accruals
Liabilities for services received for which payment has yet to be made. Examples include accrued wages, accrued taxes, and accrued interest.

7.Accrued expenses
Amounts owed but not yet paid for wages, taxes, interests, and dividends. The accrued expenses account is a short-term or current liability.

8.Active management
Attempts to identify mispriced securities, or to forecast broad market trends.

9.Active portfolio strategy
A strategy that uses available information and forecasting techniques to seek better performance than a buy and hold portfolio.

10.Agency costs
Costs of resolving the conflicts of interest among stockholders, bondholders, and managers. They include the costs of providing managers with an incentive to maximize shareholders’ wealth and then monitoring their behaviour, and the cost of protecting bondholders from shareholders. Agency costs borne by stockholders.

11.Agency problem
Conflicts of interest among stockholders, bondholders, and managers.

12.Agency theory
The theory of the relationship between principals and agents. It involves the nature of the costs of resolving conflicts of interest between principals and agents.

13.Alpha
In a nutshell, alpha is the difference between a fund's expected returns based on its beta and its actual returns. Alpha is sometimes interpreted as the value that a portfolio manager adds, above and beyond a relevant index's risk/reward profile.

14.Amortization
Process of writing off or liquidating an asset or loan periodically on an installment basis.

15.Analyst
Employee of a brokerage or fund management house who studies companies and makes buy-and-sell recommendations on stocks of these companies.

16.Angel investor
A private wealthy individual that has no association with a venture capital firm, investment fund, etc. The "angel" invests private money into what he/she believes to be promising opportunities i.e. normally start-up companies.

17.Annual report
Yearly record of a publicly held company's financial condition. It includes a description of the firm's operations, as well as balance sheet, income statement, and cash flow statement information. SEC rules require that it will be distributed to all shareholders.

18.Annuity
A series of uniform receives (payments) for a specific number of years, which results from an initial deposit (receipts).

19.Appreciation
Increase in the value of an asset.

20.Arithmetic mean or Average
A measure of mean annual rates of return equal to the sum of annual holding period rates of return divided by the number of years.
Md. Kamruzzaman Didar
Sr. Lecturer, Department of Business Administration
Faculty of Business & Entrepreneurship

Offline kamruzzaman.bba

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Re: Finance Terminologies
« Reply #4 on: March 11, 2017, 12:53:49 PM »
21.   ASSET
Any item of economic value owned by an individual or corporation, especially that which could be converted to cash.
22.   ARBITRAGE
The simultaneous purchase and sale of an asset in order to profit from a difference in the price.
23.   AMERICAN OPTION
An option which can be exercised at any time between the purchase date and the expiration date.
23. ABNORMAL RETURN
A term used to describe the returns generated by a given security or portfolio over a period of time that is different from the expected rate of return.
24.   ASKED PRICE
The price a seller is willing to accept for a security, also known as the offer price. Along with the price, the ask quote will generally also stipulate the amount of the security willing to be sold at that price.
25.   Auction market
The most integrated market is an auction market, in which all traders’ coverage at one place to buy or sell an asset.
26.   Asset allocation
The process of deciding how to distribute an investor’s wealth among different asset classes for investment purposes.
27.   Asset pricing model
A model for determining the required or expected rate of return on an asset. See Also Capital Asset Pricing Model and Arbitrage Pricing Theory.
28.   Balance sheet
A financial snapshot, taken at a point in time of all the assets the company owns and all the claims against those assets.
29.   Balloon payment
A payment on debt that is much larger than other payments. The ultimate balloon payment is the entire principal at maturity.
30.   Banker’s acceptance
The short-term promissory notes for which a bank (by having “accepted” them) promises to pay the holder the face amount at maturity.
Md. Kamruzzaman Didar
Sr. Lecturer, Department of Business Administration
Faculty of Business & Entrepreneurship

Offline kamruzzaman.bba

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Re: Finance Terminologies
« Reply #5 on: March 11, 2017, 12:54:25 PM »
31.   Bankruptcy
The legal mechanism by which creditors take the lead over a company after that company could not meet it's debt commitments.
32.   Barter
A form of trading where the parties are accepting goods as payment rather than cash.
33.   Behavioral finance
The study of investment behavior, based on the belief that investors do not always act rationally.
34.   Beta coefficient
A measure of the extent to which the returns on a specific stock move with the stock market.
35.   Blue chip Company
Large and creditworthy company. Used in the context of general equities. Company renowned for the quality and wide acceptance of its products or services, and for its ability to make money and pay dividends.
36.   Bond indenture
A legal document specifying the rights and obligations of both the issuing firm and the bondholders.
37.   Bond rating
A rating based on the possibility of default by a bond issuer. The ratings range from AAA (highly unlikely to default) to D (in default).
38.   Bond
A security that obligates the issuer to make specified payments to the holder over a period of time.
39.   Bid Price
That a trader of foreign exchange (typically a bank) is willing to pay for a particular currency.
40.   Bid-asked spread
Difference between the price at which a bank is willing to buy a currency and the price at which it will sell that currency.
Md. Kamruzzaman Didar
Sr. Lecturer, Department of Business Administration
Faculty of Business & Entrepreneurship