Financial economics/Related Articles: Difference between revisions
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* Gearing: see Leverage | * Gearing: see Leverage | ||
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Revision as of 08:50, 11 March 2008
- See also changes related to Financial economics, or pages that link to Financial economics or to this page or whose text contains "Financial economics".
Definitions
- Arbitrage [r]: transactions to take advantage of a price differences of a product in different markets by buying where it is cheap and selling where it is dear. The possibility of arbitrage often prevents the occurrence of price differences. [e]
- Beta [r]: Please do not use this term in your topic list, because there is no single article for it. Please substitute a more precise term. See Beta (disambiguation) for a list of available, more precise, topics. Please add a new usage if needed.
- Corporation [r]: Please do not use this term in your topic list, because there is no single article for it. Please substitute a more precise term. See Corporation (disambiguation) for a list of available, more precise, topics. Please add a new usage if needed.
- Cost_of_capital [r]: The weighted average of the rates of return paid by a company on its equity (share issue) and on its debt (bonds and commercial borrowing). [e]
- Covariance [r]: A statistical parameter that indicates whether two random variables show a related linear trend. [e]
- Debt_instrument [r]: A formal obligation assumed by a borrower to replay the lender in accordance with the terms of an agreement, including bonds, debentures, promissory notes, leases and mortgages. [e]
- Derivative [r]: The rate of change of a function with respect to its argument. [e]
- Discount_rate [r]: (i) The percentage by which current value exceeds value in a year's time. (ii) The rate at which banks may borrow at their central bank's discount window. [e]
- Financial_Intermediary [r]: A go-between organisation that obtains finance from investors (or savers) and lends it to corporations (or other borrowers). Financial intermediaries include banks, building societies (or savings and loans associations) , life insurance companies and credit unions. [e]
- Financial_market [r]: A market with characteristics in common with market for goods and services but which trades in claims upon the future values of assets, and the risks inherent in such claims. Examples include stock markets options markets and derivatives markets. [e]
- Financial_regulator [r]: The United States Securities and Exchange Commission gives as its mission "to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation". Financial regulators in other countries have similar responsibilities. [e]
- Gearing: see Leverage
- Leverage [r]: (i) The use of borrowing to increase the amount of money that is available for investment or consumption. (ii) A proportional measure of indebtedness, such as the ratio of a company's debt to its shareholders' equity (the same as British "gearing"), or the ratio of the indebtedness of a household to the net value of its assets (ie net of its debts). [e]
- Moral hazard [r]: Motivation to take an otherwise unwarranted risk because the cost of an unfavourable outcome would be borne by someone other than the risk-taker. [e]
- Noise_traders [r]: Traders who buy or sell shares for reasons unconnected with information about the issuing companies or the markets in which they operate. [e]
- Option [r]: A right, but not an obligation, to buy (or to sell) an asset, usually at a stipulated price (termed the "exercise price") and at a stipulated time. An option to buy is called a "call option" and an option to sell is called a "put option". [e]
- Random_walk [r]: Please do not use this term in your topic list, because there is no single article for it. Please substitute a more precise term. See Random_walk (disambiguation) for a list of available, more precise, topics. Please add a new usage if needed.
- Securitisation [r]: The conversion of a cash flow into a marketable security (usually a claim upon debt repayments) and often categorised according to the expected risk of default (examples include collateralised debt obligations and structured investment vehicles.) [e]
- Standard deviation [r]: A statistical measure for the fluctuation of a random variable about its mean value (the square root of the variance). [e]