Vocabulary

• Asset – Anything tangible or intangible that holds value.
• Bankruptcy – A legal process for dealing with debt problems.
• Budget – An estimation of revenue and expenses over a specific future period of time.
• Capital – Wealth in the form of money or assets owned by a person or business
• Credit – The ability of a customer to obtain goods or services before payment.
• Debt – Money owed or due.
• Equity – The difference between the value of the assets and the value of the liabilities.
• Financial Literacy – The ability to understand and use various financial skills.
• Gross Income – An individual's total earnings before taxes and other deductions.
• Interest – A charge for borrowed money, generally a percentage of the amount borrowed.
• Investment – The action or process of investing money for profit.
• Liability – A company's financial debt or obligations.
• Net Income – A company's total earnings; also called net profit.
• Portfolio – A range of investments held by a person or organization.
• Profit – A financial gain.
• Risk – The chance that the actual return on an investment will be different from the expected return.
• Savings – The money one has saved.
• Tax – A compulsory contribution to state revenue.
• Wealth – An abundance of valuable possessions or money.
• Yield – The income return on an investment.
• Bonds – A fixed income investment where an investor loans money to an entity.
• Dividends – A distribution of a portion of a company's earnings to its shareholders.
• Inflation – The rate at which the general level of prices for goods and services is rising.
• Liquidity – The degree to which an asset or security can be bought or sold in the market without affecting the asset's price.
• Mortgage – A loan secured by real property through the use of a mortgage note.
• Real Estate – Property consisting of land or buildings.
• Stock Market – A market in which securities are bought and sold.
• Mutual Funds – An investment program funded by shareholders.
• Pension – A regular payment made during a person's retirement.
• Insurance – A contract that provides compensation for specified loss.
• Exchange Rate – The value of one currency for the purpose of conversion to another.
• Fiscal Policy – The means by which a government adjusts its spending levels and tax rates.
• Hedge Funds – A limited partnership of investors that uses high risk methods.
• Capital Gains – The profit from the sale of a property or investment.
• Diversification – The process of allocating capital in a way that reduces the exposure to any one particular asset or risk.
• Leverage – The use of borrowed money to increase the potential return of an investment.
• Securities – A tradable financial asset.
• Bull Market – A market in which share prices are rising.
• Bear Market – A market in which share prices are falling.
• IPO – Initial Public Offering, the first sale of stock by a company to the public.
• ROI – Return on Investment, a measure of the gain or loss made on an investment.
• Depreciation – A measure of how much of an asset's value has been used up.
• Cash Flow – The total amount of money being transferred into and out of a business.
• Venture Capital – A type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms.
• Balance Sheet – A financial statement that reports a company's assets, liabilities and shareholders' equity.
• Commodity – A raw material or primary agricultural product that can be bought and sold.
• ETF – Exchange-Traded Fund, a type of investment fund and exchange-traded product.
• Derivative – A contract between two or more parties that derives its value from the performance of an underlying asset.
• Economic Indicator – A statistic about an economic activity, they allow analysis of economic performance and predictions of future performance.
• Fiscal Year – A one-year period that companies and governments use for financial reporting and budgeting.