The ABC of Finance 2

The ABC of Finance

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A

Assets

Valuable items/resources owned by individuals/business or organizations

B

Budget

A financial plan that outlines income and expenses over a specific period

C

Credit Score

A numerical representation of an individual's creditworthiness

D

Debt

Money borrowed and owed to lenders

E

Equity

Ownership in an asset or company

F

Financial planning

Setting goals/creating a budget and making strategic decisions to achieve financial success

G

Gross Income

The total earnings before taxes and deductions are applied

H

Hedge Fund

An Investment fund that employs various strategies to generate high returns for its investors

I

Interest

The Cost of borrowing money or the return on investment for lending money

J

Joint Account

A bank or investment account shared by two or more individuals

K

KPI

Key Performance Indicators

L

Liquidity

The ease with which an asset can be converted into cash without significant loss in value

M

Mutual Fund

An investment vehicle that pools money from multiple investors

N

Net Worth

The difference between an individual's or company's assets and liabilities

O

Options

Financial derivatives that give the holder the right but not the obligation to buy/sell an underlaying asset

P

Portfolio

A collection of investments held by an individual or organization

Q

Quick ratio

A financial metric that measures a company's ability to cover its short-term liabilities

R

Retirement Planning

Involves saving and investing money to ensure financial security during retirement years

S

Stock Market

A market-place where stocks (shares of ownership in companies) are bought or sold

T

Taxes

Compulsory payments made to the government by individuals and businesses

U

Underwriting

The process of assessing risk and determining the terms and conditions of insurance policies

V

Volatility

Measures the degree of variation in the price of an asset or security over time

W

Wealth Management

Involves financial services and strategies to help high-net-worth individuals

X

Xenocurrency

A xenocurrency is a currency deposited or exchanged in a market outside its country of origin

Y

Yield

The return on an investment

Z

Zero-Sum Game

A situation in which one participant's gain/loss is exactly balanced by the losses/gains of other participants

Any other examples you’d add? Let me know in the comments below 👇

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