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What is the Advance Decline Ratio? The advance decline ratio is used to determine how the market performed on a given day. It does this by comparin...

A strong dollar is one that has earned trust on an international scale. It reflects a reliable currency...at least, more reliable than that of othe...

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...

Are monopolies evil? Should they be regulated? Should they be illegal? Monopolies in and of themselves, are neither good nor evil. How they conduct...

What's a yankee bond, and does it stick a feather in its cap and call it macaroni?

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

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...

The Federal Open Market Committee's purpose is to manage financial outcomes through monetary policy.

PERLS is a bond that pays interest twice a year, but whose yield is linked to a given foreign exchange rate. It also doesn't string very well on a...

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. S...

What's the SEC? Easy. Seals Eating Candy. Or maybe Silly Elephants Canoodling? We can never remember. Guess it's time to watch this video and refre...

What is inflation, and if we poke it with a pin, will it pop?

What is Capital Gains Distribution? Owners of equity based mutual funds which are successful in investing will inevitably be the recipients of thei...

What is a Budget? A budget is a projected estimate of revenues and expenses within a fixed time period. It is intended to be a guide and reference...

Who invests in stocks? 401k plans, pension funds, institutional investors, banks, traders, clients of Schwab, Fidelity, and Franklin. Joe Blow buys...

A naked option isn't as risqueé as it sounds...it's just an option you sell without having enough of the underlying security to cover your butt if...

What rights does a public stockholder have? Common shareholders elect the board of directors. They vote. They have the right to quarterly financial...

What are Bonds? The simplest explanation is that a bond is essentially an I.O.U. that is issued by a corporate or government institution to borrow...

What is the Free Rider Problem? The free rider problem occurs when people take more than their contributed fair share of a common resource. In the...

What is Coupon Stripping? Coupon stripping is the process of taking a coupon bearing bond and separating the coupons into individual zero coupon se...

What is Balloon Interest or a Balloon Payment? Balloon interest happens when bonds with growing interest are held for a long time. A balloon payment happens when the largest payment (substantially larger than the others) occurs at the end of the loan.

What is Assessed Value? Assessed value is used to determine a piece of real estate’s tax liability. An assessor measures what the property is worth and that value is used to calculate property taxes.

What is an Agency Relationship? An agency relationship allows an agent to act on behalf of the individual or company who hires them. This type of relationship is common in the financial world because individuals who hire financial advisors or fund managers to handle their finances are essentially creating agency relationships.

What is a Dual Currency Bond? Multinational corporations often find their books filled with foreign currencies from countries where they have businesses and have established their brand. One way in which they utilize some of these currencies is to enact securities underwriting that allows them to circulate interest payments in a different currency than repayment of principal. These hybrid securities are called Dual Currency Bonds. Due to the added foreign exchange risk to prospective bondholders, interest rates are usually higher than comparable single currency bonds from the same issuer.

What is the difference between progressive and regressive taxes (flat tax vs. marginal tax)? In the most basic sense, progressive taxes affect the wealthy more and regressive taxes affect the lower-income population more. This applies to companies too; high-income versus low-income companies are affected in the same manner. Progressive tax acts like marginal tax, in that, as income rises, it is taxed more. Flat tax acts like regressive tax because it taxes everyone at the same amount regardless of income.

Theta refers to either the amount of time left on a contract, or the sorority girl asking if you want to come to her mixer. The answer will always be no, Jen.

How does a hedge fund work? Hedge funds, which deploy an array of strategies that include high risk leverage and derivatives, are private investment companies that are subject to less supervision from the SEC than mutual funds or ETFs. They are usually only open to accredited investors (as defined by the SEC). Asset classes are wide open and can include real estate, currencies, gemstones, or anything that can generate a trading profit, in addition to negotiable securities. The hedge fund is also compensated by both charging fees as well as taking a sizable percentage of profits as performance compensation.

Money laundering is the act of trying to hide money that was acquired illegally. See: Breaking Bad.

What is an Exchange Rate? An exchange rate is what a domestic currency is worth in a foreign currency’s denomination and vice versa. An exchange rate can be floating, such as in the Forex spot market, where valuations can change by the second in real time, or fixed, meaning the currency has a peg with another currency, such as the Hong Kong dollar to the US Dollar 7.84 to 1 peg.

What is the student loan crisis? The student loan crisis describes the situation that faces our country; namely the fact that there is over a trillion dollars in student loan debt. The cost of college is so astronomical that many students struggle (or fail) to repay their student loans because payments exceed entry-level salaries. At the very least, it causes problems for the economy, because this huge chunk of people who have student loan debt often have close to no expendable income.

What is a line of credit? A line of credit is kind of like a loan. A bank gives a borrower a line of credit, which basically says they can borrow “x” amount of money, and then the borrower can take that money at any time they please. As long as they don’t take more than the maximum amount outlined by the line of credit, of course.

What is Deficit Financing? Deficit financing happens when the government has to borrow money to spend because what they are spending is more than what they are making. It causes a country to go more in debt than they already are.

What are petrodollars and what do they have to do with dinosaurs?

What are NASDAQ and the NYSE? NYSE stands for New York Stock Exchange, and NASDAQ is more or less a component of this. The stock exchange is where investors can buy and sell securities. NASDAQ, specifically, is an index that serves as the benchmark for tech stocks like Google and Apple.

What's a sector fund? Hit play to find out.

NGO = Non-Governmental Organization. NGOs are (intentionally) non-profit organizations. Greenpeace. United Way. Books for Dogs. You get it.

What is a recession? Luckily, it has nothing to do with your hairline...hit play to find out more.

What is an Auction Market? Auction markets are the common stock exchanges. They allow buyers and sellers to enter bids and offers; trades occur when the highest price a buyer will pay or the lowest price a seller will take is reached.

What are Commodities? Commodities are primarily defined as everyday resources consumed by most people in industrialized societies that are derived from mining, drilling or agriculture, such as silver, oil and coffee or coffee. However, the term `commodity’ has since been extended to include ubiquitous services, such as electricity and WiFi.

What are ETFs? They are Exchange Traded Funds, and unlike index funds, they don't really change, or rebalance, based on the industries represented by their exposure. They're set once, and... that's it. From there, the performance of the fund, just... does its thang.