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What's a lock-up agreement? We think it has something to do with a shiv, but let's watch this video, just in case.

What are Capital Markets? The most often context used for “Capital Markets” is in corporate finance and investment banking, and it refers prima...

What are overbought and oversold? Hit play to find out.

Selling away is the practice of selling securities that aren't under the seller's auspices to sell.

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...

The Investment Company Act of 1940 regulated and ensured fair dealings in the mutual fund industry.

What is the primary market? Hit play to find out.

What is After Tax Yield? After tax yield is simply how much an investment makes (or yields) after taxes have been paid. This term refers to bond yi...

What is liquidity? Think: water. It's liquid. It can be squeezed into little, tiny spaces and infused into large spaces. A defining trait of liquid...

A liquid market is a market featuring high trading volumes, i.e. investors actually want to put their cash to work.

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

A primary offering is just an IPO - the initial public offering of a given stock. Primary shares are the shares of that stock that are sold... publ...

What is a Day Trade? A day trade is a trade done in the public markets where the buy and the sell are both done on the same day, thus marking the n...

What is an Affiliated Person or Affiliated Investor? An affiliated person is known as an insider in the financial world. These are the people who h...

What does it mean to "go public?" An IPO raises cash in the form of equity, usually, for investors. When public, a company exists under SEC dominio...

What is the Alternative Minimum Tax? Alternative minimum tax is a different way of calculating tax liability. It’s only available to some individ...

What is due diligence? Basically, it's... doing your research. You're preparing to make an investment or purchase, and you want to make sure there...

Comparative advantage refers to what one party sacrifices in order to create a product or service compared to another. The one who loses out less h...

What is a road show? In order to generate excitement about a new product, companies often resort to social media as well as the more conventional t...

What is an Associated Person? An associated person is just an employee of a broker or a dealer that are involved in trading. These people must be c...

Sandbagging is the practice of keeping financial estimates conservative so that they are more likely to exceed expectations. We do a similar thing at work. Always under promise, always over deliver.

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.

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 the difference between taxable and untaxed returns? Not all returns and investments are taxed. Some of these can be considered nontaxable income. One example of an investment that has untaxed returns is muni bonds. Specifically, the interest from these bonds is not taxed.

What are Weighted Averages and Expected Values? Weighted averages are averages calculated to account for the number of changes that a variable, such as price, may have, especially when the same asset may have been added to the portfolio in varying quantities and price costs over time for a cumulative total. Expected Values is an anticipated prediction of an asset’s value over a specified time that is calculated as the total of possible results times their statistical probability.

Tax basis is your cost for assessing how much you owe in taxes, and is determined by multiplying your gains by your tax rate.

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 refresh our memories.

What is Regulation Full Disclosure? Publicly traded companies are required by SEC rules to release full disclosure of all info related to material events of the company within legal limits and federal statutes. For example, in order to be compliant with SEC rules, Northrop Grumman could announce a new deal to supply fighter jets for the USAF and the dollar amount of the deal, as well as for how many units over what period of time. However, national security rules would prevent the need to disclose the kind of weaponry or tactical stealth capabilities that the aircraft may include.

What are systematic and unsystematic risk? Take a risk on this video and hit play.

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 paid-in-capital and capital surplus? Hit play to find out.

In trying to assess the value of a company, market capitalization refers to the number of stock shares times the stock price. Perceived value in this case is predicated upon the price that buyers are willing to pay for the stock in the market. When referring to equity, it is a more detailed calculation of worth, as it subtracts liabilities from assets to determine the company’s break up value, i.e, if everything in the company had to be sold. An analogy would be what a diamond necklace might be worth at an auction at Sotheby’s vs. its breakup individual stone value per karat weight at a pawnshop jeweler.

What is recapitalization? Pay attention the first time, there won't be a recap.

What is Discounted Cash Flow? Discounted Cash Flow is a model that’s used to determine the value of an investment or company. It’s pretty complicated, so it’s not the first thing most people would consider calculating when deciding whether or not to make an investment. It also uses future cash flow predictions, so it is a bit helpful when estimating growth. If it’s found that the expected future cash flows will create an increase in value as compared to current value, it’s probably a good investment.

What is Earnings Quality? Earnings quality refers to a company’s tangible earnings from sales or reduced expenses as a result of management decisions and policies, as opposed to accounting manipulation devices, such as virtually inflating or reducing a standing inventory into a different accounting quarter or year end report for tax reporting or other reasons.

What is an Approved List? Investors give approved lists to their fund managers (brokers). These lists tell the broker what investments they can make according to the investor’s financial goals.

When assessing the amount of profitability in a company’s various services and/or products, the contribution margin is a metric that is relied upon for calculation purposes. As a formula, it is a simple Sales minus Variable Costs equation. It is an important tool for gauging pricing. Companies that may be vulnerable due to an over reliance on 1-2 highly profitable products can find themselves in a cash crunch if one of the Variable Costs suddenly becomes more expensive and the company has a cap on how high in can raise prices without losing competitiveness with its rivals. A manager’s ability to reduce Variable Costs will increase the contribution margin and hopefully allow for increases in sales, and commensurate incentive bonuses.

What is the 1934 Securities Exchange Act? The 1934 Securities Exchange Act brought about the SEC, or the Securities Exchange Commission. This act, and the SEC, monitor and govern all realms of the financial world to ensure fair practice by all parties involved.

What is opportunity cost? In short, it's the eventual monetary cost of choosing to do one thing over another (often choosing travel or experiences over their monetary equivalent). That contract guaranteeing you $100k a year might sound terrific when you're staring $200k of student loans in the face, but if it locks you out of a much higher paying job five years down the road, you can kiss wealth and financial success good-bye.

What are retained earnings, and do they give you cankles?