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What is the Dow Theory? Dow Theory is a collection of indicators and definitions of the types of market signals for indicating a Bull or Bear marke...

What is the Efficient Markets Theory? The Efficient Markets Theory says that stocks trade at their fair value all of the time, assuming all informa...

What is a Fund of Funds? A fund of funds is a mutual fund strategy that invests in other funds rather than investing in stocks or bonds. The underl...

What is Collateralized Mortgage Obligation (CMO)? A CMO is a mortgage bond that consists of a large number of different individual mortgages bundle...

What is Beta? Beta is a figure associated with public companies that measures how risky the company’s stock is in comparison to the market as a w...

What is short interest theory? Watch this not-so-short video to find out.

What is a thin market, and has it been on Jenny Craig recently?

The Russell Index is a series of indices that tracks the progress of stocks in a given basket. Aw. We were hoping it tracked adorable Jack Russell...

What is the Dow Jones Industrial Average? The Dow Jones Industrial Average is usually just called the Dow. It’s an average of 30 of the most well...

What do you need to retire? Retirement - think: 401k, pension fund, IRA, roth IRA, etc. All of these savings socked away while you worked hard are...

There’s an old saying on Wall Street: People who want to make a lot of money buy stocks. People who have a lot of money buy bonds. The amount of...

What is suspended trading? It has nothing to do with suspenders, which is a bummer...we love suspenders. They're so jaunty.

What is a Commingled Fund? Commingled funds are similar to mutual funds but contain different assets and possible asset classes. They are blended t...

The Wilshire 5000 is an index fund, which is kind of a bummer...it sounded like a cool financial robot.

What is the S&P 500? It's Standard & Poor's 500 generally largest companies, with a U.S. domestic bias. The S&P 500 is usually what investors think...

What is a Country Basket (Index Fund)? Investing internationally can be a challenge, as foreign exchange, different accounting rules, time zones an...

What are the differences in S&P’s and Moody’s ratings? Both S&P and Moody’s give ratings that help investors determine if they are making sma...

What are bond ratings and what do they mean? Bond ratings are just credit ratings used on bonds. Just like a credit rating, they give the investor...

What is the Federal Funds Rate? The federal funds rate is the interest rate used for overnight lending between banks. The amount banks are able to...

What is a Family of Funds? A family of funds refers to all of the funds managed by an investment firm. These firms offer investors the ability to i...

Who is Warren Buffett, and how do we get him to give us a loan...?

The random walk hypothesis is a financial theory that suggests the market is unpredictable, and can't be beaten. (Cough-cough-B.S.)

What is a Buy and Hold Strategy? A buy and hold strategy can be thought of as what someone might use in a retirement account or college account (comprised of stock) for a young child. They make investments and let them sit there without changes for a long time regardless of any movements in price because these movements should be short-term.

What is tax loss selling? Hit play to find out.

How do you judge the performance of an index fund? For index funds, they're really just a reflection of the stocks and bonds they, uh... reflect. So if the stocks in the fund are doing okay... well, the fund is probably doing okay, too. Relative performance is everything. The S&P 500, NASDAQ, and the Dow are the typical measuring sticks.

What is real return? Real return is the actual return made from an investment after inflation is factored in. Return is expressed as a percentage called a nominal rate of return before inflation; real return shows how much was actually made given inflation.

What is asset allocation? Asset allocation is the process of executing an investment strategy that is tailored to a particular investor’s risk tolerance and return on investment goals. While investors would like to get as large a return as they can, those with weak stomachs will blanche at the volatility of option and high flying tech stocks and may endure less sleepless nights invested in large cap equities or bonds, eschewing the higher potential returns for greater peace of mind. Asset allocation also needs to be regularly reviewed and adjusted should market conditions change in order to minimize losses or erosion of gains.

What is the Relative Strength Index? The Relative Strength Index is a technical analysis indicator that measures trading direction trends over the course of 14 trading sessions (on average) and calculates the degree of up and down percentages to determine whether or not the asset in question may be indicating an overbought or oversold signal.

NAV isn't a cool new navigation app...it's how mutual fund shares are valued or priced at the end of each trading day.

Strategic asset allocation means allocating your assets...strategically. Yup, no crazy plot twists here.

What is Capital Gains Tax? Capital gain taxes are taxes collected by the IRS on trading profits from investments in equities, real estate, or any other type of transaction in which something defined as an asset is bought and then resold at a profit. The amount of assessed capital gains taxes is contingent upon the length of time the asset was held.

What are revenues? Revenue is the amount of money a company brings in after they’ve accounted for returns and discounts and such. It’s just what was brought in; it doesn’t account for costs that have to go out.

Inventory turnover...way less delicious than an apple turnover. So...what is it?

What are Return on Equity and Return on Assets? Return on equity is a percentage that is found by dividing net income by shareholder’s equity. It can be used to determine growth and financial health, but differs greatly among sectors, so only similar companies should be compared using ROE. Return on assets divides net income by total assets; this tells investors how profitable a company is given what they have.

A wrap account is an account that wraps into one annual fee all of the services you'd normally pay for a la carte at a given brokerage.

An omnibus account is an investment account in which a collection of investors have invested their capital to own a pro rata share of that cooperative investment. Either that, or it’s a lot of buses.

What is Earnings Per Share (EPS)? Earnings Per Share is a metric by which to measure the profitability of a public company as a result of how much profit per common share was generated, after accounting for any dividends and both the weighted average of common shares as well as diluted shares when including warrants, stock options, restricted shares, and possible debt to equity common shares via convertible bonds or preferred shares.

What is a Money Market Fund/Commercial Paper? Money Market Funds are mutual funds that are very safe and liquid. They invest in cash and securities with short-term maturities. Commercial paper is similar in that it has the short-term aspect. It is different because it’s issued by companies and used to take care of various financial obligations in the short term, or to buy inventory.

What is Crowding out? Crowding out is a phenomenon that occurs when the government enters into a sector in an economic fashion and its size creates a domino effect of other consequences that create disincentives for comparable or related actions in the private sector. For example, when the government enacts a stimulus package, an accompanying rise in interest rates may make financing projects in the private sector too costly.

What is a Blue Chip? Blue chip stocks are stocks with very large market caps; basically meaning their issued stock is worth a lot of money. These companies are very well established and successful making them safe long-term investment options.