Finance & Investment Glossary: Key Terms Explained

Financial Terms

Basic Concepts

• Mortgage: A loan to buy real estate.
• Deposits: Money you put in the bank.
• Pension: Money paid to a retired person.
• Stock/Shares: Securities representing part-ownership of a company.
• Capital: Money invested in a business.
• Bonds: Interest-paying securities issued by companies that need to borrow.

Company Actions

• Takeover: When a company gains control of another by buying its stock.
• Merger: When two formerly separate companies join together.

Financial Institutions

1. Retail Banks: Making loans, receiving deposits.
2. Building Societies: Arranging mortgages.
3. Insurance Companies: Providing pensions, offering life insurance.
4. Investment Banks: Issuing shares or bonds, arranging mortgages, arranging or fighting takeover bids.

Vocabulary

Key Terms

• Conglomerates: Groups of companies that have joined together.
• Depositors: People who place money in bank accounts.
• Deregulated: Abolished or ended rules and restrictions.
• Fines: Sums of money paid as penalties for breaking the law.
• Prohibited: Made it illegal to do something.
• Regulation: Control of something by rules or laws.
• Repealed: Canceled or ended (a law).
• Underwriting: Guaranteeing to buy a company's newly issued stock if no one else does.

Additional Terms

• Stock or Share: Equity (USA = stock / Britain = share)
• Bid: Buying
• Shareholders: Stakeholders

Market Trends

Movement

• Go Up: Rise, to increase, rally
• Go Down: To tumble, fall, to drop
• The Same: To be steady, to be unchanged

Equivalents

• Income = Earnings = Profits

Global Stock Indices

Asia

• Singapore: Straits Times Index
• China: Shanghai Composite
• Hong Kong: Hang Seng
• Japan: Nikkei 225

Europe

• France: CAC 40
• Germany: DAX
• Europe: FTSE 100
• Russia: MOEX 10

Americas

• USA: Dow Jones, S&P 500, Nasdaq 100
• Mexico: IPC
• Chile: IPSA-IGPA
• Brazil: Bovespa
• Argentina: Merval

Additional Definitions

• Fines: A monetary penalty for an act.
• Conglomerates: A firm engaged in two or more unrelated businesses.
• Underwriting: The act of undertaking to purchase...
• Depositors: A person or thing that deposits...
• Merger: A decision by two companies...
• Mortgage: A loan to buy real estate.
• Capital: Money invested in a firm.
• Loan: The extension of money from one party...
• Trader: Is one who trades in the market. A Broker is one who provides a platform to a trader to trade and make money.