Vocabulary

• Passive Income – Earnings derived from a rental property, limited partnership, or other enterprise in which a person is not actively involved.
• Income Streams – Different sources from which an individual or business makes money.
• Rental Property – A property from which the owner receives payment from the occupants, known as tenants, in return for occupying or using the property.
• Limited Partnership – A form of partnership where one or more partners have limited liabilities.
• Enterprise – A business or company.
• Dividend Stocks – Shares in a company that pays dividends to its shareholders.
• Bonds – A type of investment where an investor loans money to an entity that borrows the funds for a defined period of time at a fixed interest rate.
• Mutual Funds – An investment program funded by shareholders that trades in diversified holdings and is professionally managed.
• ETFs – Exchange-Traded Funds; a type of investment fund and exchange-traded product, with shares that are buyable or sellable on a stock exchange.
• REITs – Real Estate Investment Trusts; a company that owns, operates, or finances income-generating real estate.
• Peer-to-Peer Lending – A method of debt financing that enables individuals to borrow and lend money without the use of an official financial institution.
• Crowdfunding – The practice of funding a project or venture by raising small amounts of money from a large number of people.
• Royalties – A payment made by one party to another that owns a particular asset, for the right to ongoing use of that asset.
• Annuities – A financial product that pays out a fixed stream of payments to an individual, primarily used as an income stream for retirees.
• Treasury Securities – Federal debt obligations with a promise to pay periodic interest and to repay the principal at maturity.
• Index Funds – A type of mutual fund with a portfolio constructed to match or track the components of a financial market index.
• Cryptocurrency – A digital or virtual currency that uses cryptography for security and operates independently of a central bank.
• Franchise – The right or license granted by a company to an individual or group to market its products or services in a specific territory.
• E-commerce – The buying and selling of goods and services over an electronic network, primarily the internet.
• Dropshipping – A retail fulfillment method where a store doesn't keep the products it sells in stock.
• Capital Gains – The rise in the value of a capital asset that gives it a higher worth than the purchase price.
• Interest – The charge for the privilege of borrowing money or the return earned on invested capital.
• Asset – A resource with economic value that an individual, corporation or country owns or controls with the expectation that it will provide a future benefit.
• Liquidity – The degree to which an asset or security can be quickly bought or sold in the market without affecting the asset's price.
• Liability – An obligation arising from past transactions or events, the settlement of which may result in the transfer or use of assets, provision of services or other yielding of economic benefits in the future.
• Stock Market – A public market for the trading of company stock and derivatives at an agreed price.
• Portfolio – A collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, as well as their fund counterparts.
• Financial Advisor – A professional who suggests and renders financial services to clients based on their financial situation.
• Tax – A compulsory contribution to state revenue, levied by the government on workers' income and business profits or added to the cost of some goods, services, and transactions.
• Inflation – The rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.
• Deflation – Reduction of the general level of prices in an economy.
• Recession – A significant decline in economic activity spread across the economy, lasting more than a few months.
• Bull Market – A market in which share prices are rising, encouraging buying.
• Bear Market – A market in which prices are falling, encouraging selling.
• Real Estate – Property consisting of land or buildings.
• Commodities – Basic goods used in commerce that are interchangeable with other goods of the same type.
• Derivatives – Financial securities with a value that is reliant upon or derived from, an underlying asset or group of assets.
• Forex Trading – The process of buying, selling and exchanging currencies at current or determined prices to make a profit.
• Arbitrage – The simultaneous purchase and sale of an asset to profit from a difference in the price.
• Venture Capital – Financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential.
• Private Equity – Capital that is not listed on a public exchange, composed of funds and investors that directly invest in private companies.
• Hedge Fund – An aggressive investment fund that pools capital from accredited individuals or institutional investors and invests in a variety of assets.
• IPO – Initial Public Offering; the process by which a private company can go public by sale of its stocks to general public.
• ROI – Return on Investment; a performance measure used to evaluate the efficiency of an investment.
• Capital Loss – The decrease in the value of an investment or real estate that makes its selling price less than its purchase price.
• Savings Account – A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate.
• Checking Account – A deposit account from which withdrawals can be made by writing a check.
• Certificate of Deposit – A savings certificate with a fixed maturity date and specified fixed interest rate.
• Money Market Account – An interest-bearing account that typically pays a higher interest rate than a savings account.
• Credit Score – A statistical number that evaluates a consumer's creditworthiness and is based on credit history.