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A redemption charge is a charge applied when you redeem shares of a mutual fund in a deferred commission purchase structure.

What was the Tax Reform Act of 1986? Hit play to find out.

Maturity is, quite simply, the date when a debt becomes due. As for our maturity, well... we're still giggling about the word "due."

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

What is Counterparty Risk? Counterparty risk is the risk to either party within a transaction that the other will not or be unable to abide by the...

What are Bond Anticipation Notes (BANS), Revenue Anticipation Notes (RANS), and Tax Anticipation Notes (TANS)? BANS, RANS and TANS are all short-te...

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...

Term to maturity is kind of the life cycle of a bond, but luckily for the bond, it gets to skip puberty.

What are securities? Using the word securities is just a fancy way to say investments, for the most part. These particular investments include stoc...

What is Contingent Liability? Contingent liability refers to a possible liability in the future contingent upon some other event being the trigger....

Power of attorney refers to the authorization to conduct business on legal and financial matters on behalf of another party. So...choose wisely.

What is Yield to Maturity? When calculating bond yields, the yield to maturity is the interest rate that an investor would ultimately accumulate if...

A moral obligation bond is a bond that is paid or backed by a well-heeled, better funded entity should the bond default.

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...

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

NASD is the National Association of Securities Dealers, a self-regulating organization that was ultimately replaced by FINRA.

What is AMBAC? AMBAC stands for American Municipal Bond Assurance Corporation. It provides insurance for municipalities that sell muni bonds, such...

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

A trust deed lays out the rights and obligations of the bank underwriting the purchase of inventory/assets. That said, it won't catch you in a trus...

What is a partnership? A partnership is an arrangement where two or more parties agree to form a business in cooperation with each other. Partnersh...

If you go to an arcade and want to play coin-operated games, you will often exchange $1 bills for (4) quarters at a time. This is the equivalent of a 1 for 4 stock split. The net value is the same, but you have more small units instead of a single larger one. The advantage for a stock is that its lower price represents an easier entry level for new investors to get involved, since buying shares of a stock at 25 is easier for an initial portfolio allocation than at 100. A forward split is usually an indication that a company is growing and attracting more investors. Conversely, a reverse split would be like getting a dollar for your 4 quarters. Reasons for a reverse split could be too much stock outstanding to move the stock price, flushing out naked short sellers, or a post reverse merger stock overhang cleanup.

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.

What is amortization? Amortization tracks the decline in value of a contract or service, usually paid for in advance. You received $10,000 in advance to water Ms. Maple's lawn for 10 months. She amortizes your watering to the tune of a decline in value of that contract of $1,000 as each month goes by.

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.

What is the difference between short-term and long-term liabilities? Short-term liabilities show up on the balance sheet. They need to be paid in the short-term using the inflow from cash and accounts receivable, as shown on the balance sheet. These are things like accounts payable and employee salaries. Long-term liabilities are things like loans and such that the company won’t need to pay back for over a year.

What are the types of income tax? Federal income tax. State income tax. Real estate tax. Value Added Tax (VAT). Some tax is progressive, some tax is regressive. The commonality: they're all bad.

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 is term life insurance, and variable life insurance? Hit play to find out, and, uh...let's hope you live long enough to figure out the answers.

What is a cost-benefit analysis? Prudent management of a company will often deploy cost-benefit analysis to quantify the degree of finances, resources, and man hours may go into a new project or initiative and whether or not the projected benefits, profits and advantages will be worth the costs of the launch.

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.

Reg A is an exemption for the sale of securities. We wonder if it has any sweet steel drums in the background.

What are operating profits, net profits and gross profits? Profits for a company can be calculated several different ways depending on what metric is being cited. Gross profits are measured by total revenues minus cost of goods or services sold. Of course, a company also has operating expenses, as well as depreciation and amortization, which are accounting deductions on equipment and other property belonging to the company. The Operating profit subtracts those elements from the Gross profit. The Net profit also factors in taxes and interest, which are also company costs that can apply against revenues. Naturally, the Net profit will result in the smallest number. Gross profit is also sometimes referred to as EBITDA, which is Earnings Before Interest, Taxes, Depreciation and Amortization.

What is stock based compensation? Stock based compensation is exactly what it sounds like: a way to compensate employees using stock. It’s used in the form of purchasing options that employees may exercise, usually after a few years.

How do some accountants “cook the books”? Cooking the books refers to accountants making company’s financials look much better than they are. They can do this in a bunch of different ways, including accounting for revenue that isn’t promised, pushing back payments owed, and messing with what is owed to employees, among other fancy tricks.

What is Accrual Accounting? Accrual accounting is used to determine how well a company is doing by looking at the present and the future. It takes into account purchases that are made and debts that are owed as soon as the transaction is made, rather than when the money is received or paid.

What is the Acid Test Ratio/Quick Ratio? The Acid Test Ratio is used to determine if a company can cover their liabilities in the short-term. It only uses liquid assets in its calculation because of the short-term nature. To find the acid test, or quick ratio, all current assets are divided by current liabilities.

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 a balance sheet? A balance sheet is a financial document that public corporations are required to use. It shows their assets and liabilities (what they have and what they owe). It also includes shareholder’s equity, or how much is invested in the company, and this number combined with liabilities should be equal to assets (balanced).

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.