The following

outline Outline or outlining may refer to: * Outline (list), a document summary, in hierarchical list format * Code folding, a method of hiding or collapsing code or text to see content in outline form * Outline drawing, a sketch depicting the outer edge ...

is provided as an overview of and topical guide to finance:

Finance Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fina ...

– addresses the ways in which individuals and organizations raise and allocate monetary resources over time, taking into account the

risk In simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environme ...

s entailed in their projects.

Overview

The term finance may incorporate any of the following: * The study of

money Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are as ...

and other

asset In financial accountancy, financial accounting, an asset is any resource owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that can be used to produce positive economic value. Assets represent value ...

s * The

management Management (or managing) is the administration of an organization, whether it is a business, a nonprofit organization, or a government body. It is the art and science of managing resources of the business. Management includes the activities o ...

and control of those assets * Profiling and managing project risks

Fundamental financial concepts

Arbitrage In economics and finance, arbitrage (, ) is the practice of taking advantage of a difference in prices in two or more markets; striking a combination of matching deals to capitalise on the difference, the profit being the difference between the ...

Capital (economics) In economics, capital goods or capital are "those durable produced goods that are in turn used as productive inputs for further production" of goods and services. At the macroeconomic level, "the nation's capital stock includes buildings, eq ...

Capital asset pricing model In finance, the capital asset pricing model (CAPM) is a model used to determine a theoretically appropriate required rate of return of an asset, to make decisions about adding assets to a well-diversified portfolio. The model takes into accou ...

Cash flow A cash flow is a real or virtual movement of money: *a cash flow in its narrow sense is a payment (in a currency), especially from one central bank account to another; the term 'cash flow' is mostly used to describe payments that are expected ...

Cash flow matching Cash flow matching is a process of hedging in which a company or other entity matches its cash outflows (i.e., financial obligations) with its cash inflows over a given time horizon. It is a subset of immunization strategies in finance. Cash flow ...

Debt Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...

***

Default Default may refer to: Law * Default (law), the failure to do something required by law ** Default (finance), failure to satisfy the terms of a loan obligation or failure to pay back a loan ** Default judgment, a binding judgment in favor of ei ...

*** Consumer debt *** Debt consolidation *** Debt settlement *** Credit counseling ***

Bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debtor ...

*** Debt diet ***

Debt-snowball method The debt snowball method is a debt-reduction strategy, whereby one who owes on more than one account pays off the accounts starting with the smallest balances first, while paying the minimum payment on larger debts. Once the smallest debt is paid ...

***

Debt of developing countries The debt of developing countries usually refers to the external debt incurred by governments of developing countries. There have been several historical episodes of governments of developing countries borrowing in quantities beyond their abilit ...

**Asset types ***

Real Estate Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more general ...

*** Securities ***

Commodities In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them. The price of a comm ...

***

Futures Futures may mean: Finance *Futures contract, a tradable financial derivatives contract *Futures exchange, a financial market where futures contracts are traded * ''Futures'' (magazine), an American finance magazine Music * ''Futures'' (album), a ...

***

Cash In economics, cash is money in the physical form of currency, such as banknotes and coins. In bookkeeping and financial accounting, cash is current assets comprising currency or currency equivalents that can be accessed immediately or near-imm ...

Discounted cash flow The discounted cash flow (DCF) analysis is a method in finance of valuing a security, project, company, or asset using the concepts of the time value of money. Discounted cash flow analysis is widely used in investment finance, real estate devel ...

Financial capital Financial capital (also simply known as capital or equity in finance, accounting and economics) is any economic resource measured in terms of money used by entrepreneurs and businesses to buy what they need to make their products or to provide ...

*** Funding ** Entrepreneur ***

Entrepreneurship Entrepreneurship is the creation or extraction of economic value. With this definition, entrepreneurship is viewed as change, generally entailing risk beyond what is normally encountered in starting a business, which may include other values th ...

Fixed income analysis Fixed income analysis is the process of determining the value of a debt security based on an assessment of its risk profile, which can include interest rate risk, risk of the issuer failing to repay the debt, market supply and demand for the secu ...

Gap financing Gap Financing is a term mostly associated with mortgage loans or property loans such as a bridge loan A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-t ...

** Global financial system **

Hedge A hedge or hedgerow is a line of closely spaced shrubs and sometimes trees, planted and trained to form a barrier or to mark the boundary of an area, such as between neighbouring properties. Hedges that are used to separate a road from adjoini ...

***

Basis risk Basis risk in finance is the risk associated with imperfect hedging due to the variables or characteristics that affect the difference between the futures contract and the underlying "cash" position. It arises because of the difference between th ...

Interest rate An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, th ...

*** Risk-free interest rate ***

Term structure of interest rates In finance, the yield curve is a graph which depicts how the yields on debt instruments - such as bonds - vary as a function of their years remaining to maturity. Typically, the graph's horizontal or x-axis is a time line of months or ye ...

Short-rate model A short-rate model, in the context of interest rate derivatives, is a mathematical model that describes the future evolution of interest rates by describing the future evolution of the short rate, usually written r_t \,. The short rate Under a sh ...

***

Vasicek model In finance, the Vasicek model is a mathematical model describing the evolution of interest rates. It is a type of one-factor short-rate model as it describes interest rate movements as driven by only one source of market risk. The model can be u ...

***

Cox–Ingersoll–Ross model In mathematical finance, the Cox–Ingersoll–Ross (CIR) model describes the evolution of interest rates. It is a type of "one factor model" ( short-rate model) as it describes interest rate movements as driven by only one source of mark ...

***

Hull–White model In financial mathematics, the Hull–White model is a model of future interest rates. In its most generic formulation, it belongs to the class of no-arbitrage models that are able to fit today's term structure of interest rates. It is relatively str ...

***

Chen model In finance, the Chen model is a mathematical model describing the evolution of interest rates. It is a type of "three-factor model" (short-rate model) as it describes interest rate movements as driven by three sources of market risk. It was the f ...

***

Black–Derman–Toy model In mathematical finance, the Black–Derman–Toy model (BDT) is a popular short-rate model used in the pricing of bond options, swaptions and other interest rate derivatives; see . It is a one-factor model; that is, a single stochastic factor—t ...

Interest In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is distinct ...

***

Effective interest rate The effective interest rate (EIR), effective annual interest rate, annual equivalent rate (AER) or simply effective rate is the percentage of interest on a loan or financial product if compound interest accumulates over a year during which no pa ...

***

Nominal interest rate In finance and economics, the nominal interest rate or nominal rate of interest is the rate of interest stated on a loan or investment, without any adjustments or fees. Examples of adjustments or fees # An adjustment for inflation(in contrast with ...

***

Interest rate basis In finance, a day count convention determines how interest accrues over time for a variety of investments, including bonds, notes, loans, mortgages, medium-term notes, swaps, and forward rate agreements (FRAs). This determines the number of days b ...

***

Fisher equation In financial mathematics and economics, the Fisher equation expresses the relationship between nominal interest rates and real interest rates under inflation. Named after Irving Fisher, an American economist, it can be expressed as real interest ...

*** Crowding out ***

Annual percentage rate The term annual percentage rate of charge (APR), corresponding sometimes to a nominal APR and sometimes to an effective APR (EAPR), is the interest rate for a whole year (annualized), rather than just a monthly fee/rate, as applied on a loan, mort ...

*** Interest coverage ratio **

Investment Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort. In finance, the purpose of investing i ...

***

Foreign direct investment A foreign direct investment (FDI) is an investment in the form of a controlling ownership in a business in one country by an entity based in another country. It is thus distinguished from a foreign portfolio investment by a notion of direct co ...

*** Gold as an investment ***

Over-investing Over-investing in finance, particularly personal finance, refers to the practice of investing more into an asset than what that asset is worth on the open market. It is cited most frequently in reference to expensive personal consumable investmen ...

Leverage Leverage or leveraged may refer to: *Leverage (mechanics), mechanical advantage achieved by using a lever * ''Leverage'' (album), a 2012 album by Lyriel *Leverage (dance), a type of dance connection *Leverage (finance), using given resources to ...

Long (finance) In finance, a long position in a financial instrument means the holder of the position owns a positive amount of the instrument. The holder of the position has the expectation that the financial instrument will increase in value. This is known as ...

** Liquidity ** Margin (finance) **

Mark to market Mark-to-market (MTM or M2M) or fair value accounting is accounting for the "fair value" of an asset or liability based on the current market price, or the price for similar assets and liabilities, or based on another objectively assessed "fair" ...

** Market impact ** Medium of exchange **

Microcredit :''This article is specific to small loans, often provided in a pooled manner. For direct payments to individuals for specific projects, see Micropatronage. For financial services to the poor, see Microfinance. For small payments, see Micropayme ...

Money Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are as ...

***

Money creation Money creation, or money issuance, is the process by which the money supply of a country, or of an economic or monetary region,Such as the Eurozone or ECCAS is increased. In most modern economies, money creation is controlled by the central bank ...

***

Currency A currency, "in circulation", from la, currens, -entis, literally meaning "running" or "traversing" is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes and coins. A more general def ...

***

Coin A coin is a small, flat (usually depending on the country or value), round piece of metal or plastic used primarily as a medium of exchange or legal tender. They are standardized in weight, and produced in large quantities at a mint in order t ...

***

Banknote A banknote—also called a bill (North American English), paper money, or simply a note—is a type of negotiable instrument, negotiable promissory note, made by a bank or other licensed authority, payable to the bearer on demand. Banknotes w ...

***

Counterfeit To counterfeit means to imitate something authentic, with the intent to steal, destroy, or replace the original, for use in illegal transactions, or otherwise to deceive individuals into believing that the fake is of equal or greater value tha ...

***

History of money The history of money concerns the development throughout time of systems that provide the functions of money. Such systems can be understood as means of trading wealth indirectly; not directly as with bartering. Money is a mechanism that facilit ...

***

Monetary reform Monetary reform is any movement or theory that proposes a system of supplying money and financing the economy that is different from the current system. Monetary reformers may advocate any of the following, among other proposals: * A return t ...

** Portfolio *** Modern portfolio theory ***

Mutual fund separation theorem In portfolio theory, a mutual fund separation theorem, mutual fund theorem, or separation theorem is a theorem stating that, under certain conditions, any investor's optimal portfolio can be constructed by holding each of certain mutual funds in app ...

***

Post-modern portfolio theory Post-Modern Portfolio Theory (PMPT) is an extension of the traditional Modern Portfolio Theory (MPT), an application of mean-variance analysis (MVA). Both theories propose how rational investors can use diversification to optimize their portfolios. ...

Reference rate A reference rate is a rate that determines pay-offs in a financial contract and that is outside the control of the parties to the contract. It is often some form of LIBOR rate, but it can take many forms, such as a consumer price index, a house pric ...

*** Reset **

Return Return may refer to: In business, economics, and finance * Return on investment (ROI), the financial gain after an expense. * Rate of return, the financial term for the profit or loss derived from an investment * Tax return, a blank document or t ...

***

Absolute return The absolute return or simply return is a measure of the gain or loss on an investment portfolio expressed as a percentage of invested capital. The adjective "absolute" is used to stress the distinction with the relative return measures often use ...

***

Investment performance Investment performance is the return on an investment portfolio. The investment portfolio can contain a single asset or multiple assets. The investment performance is measured over a specific period of time and in a specific currency. Investors o ...

*** Relative return **

Risk In simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environme ...

***

Financial risk Financial risk is any of various types of risk associated with financing, including financial transactions that include company loans in risk of default. Often it is understood to include only downside risk, meaning the potential for financial ...

*** Risk management ****

Financial risk management Financial risk management is the practice of protecting economic value in a firm by using financial instruments to manage exposure to financial risk - principally operational risk, credit risk and market risk, with more specific variants as liste ...

****

Uncompensated risk In investments, uncompensated risk is the level of additional risk for which no additional return Return may refer to: In business, economics, and finance * Return on investment (ROI), the financial gain after an expense. * Rate of return, the f ...

*** Risk measure **** Coherent risk measure ****

Deviation risk measure In financial mathematics, a deviation risk measure is a function to quantify financial risk (and not necessarily downside risk) in a different method than a general risk measure. Deviation risk measures generalize the concept of standard deviation. ...

****

Distortion risk measure In financial mathematics and economics, a distortion risk measure is a type of risk measure which is related to the cumulative distribution function of the return of a financial portfolio. Mathematical definition The function \rho_g: L^p \to \m ...

****

Spectral risk measure A Spectral risk measure is a risk measure given as a weighted average of outcomes where bad outcomes are, typically, included with larger weights. A spectral risk measure is a function of portfolio (finance), portfolio returns and outputs the amount ...

**** Value at risk ***** Expected shortfall ***** Entropic value at risk ** Scenario analysis **

Short (finance) In finance, being short in an asset means investing in such a way that the investor will profit if the value of the asset falls. This is the opposite of a more conventional "long" position, where the investor will profit if the value of the a ...

Speculation In finance, speculation is the purchase of an asset (a commodity, good (economics), goods, or real estate) with the hope that it will become more valuable shortly. (It can also refer to short sales in which the speculator hopes for a decline i ...

***

Day trading Day trading is a form of speculation in securities in which a trader buys and sells a financial instrument within the same trading day, so that all positions are closed before the market closes for the trading day to avoid unmanageable risks an ...

Position trader In finance, a futures contract (sometimes called a futures) is a standardized legal contract to buy or sell something at a predetermined price for delivery at a specified time in the future, between parties not yet known to each other. The asset ...

** Spread trade ** Standard of deferred payment ** Store of value **

Time horizon Time is the continued sequence of existence and events that occurs in an apparently irreversible succession from the past, through the present, into the future. It is a component quantity of various measurements used to sequence events, to co ...

** Time value of money *** Discounting *** Present value *** Future value *** Net present value ***

Internal rate of return Internal rate of return (IRR) is a method of calculating an investment’s rate of return. The term ''internal'' refers to the fact that the calculation excludes external factors, such as the risk-free rate, inflation, the cost of capital, or fin ...

*** Modified internal rate of return *** Annuity ***

Perpetuity A perpetuity is an annuity that has no end, or a stream of cash payments that continues forever. There are few actual perpetuities in existence. For example, the United Kingdom (UK) government issued them in the past; these were known as conso ...

Trade Trade involves the transfer of goods and services from one person or entity to another, often in exchange for money. Economists refer to a system or network that allows trade as a market. An early form of trade, barter, saw the direct excha ...

***

Free trade Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold econo ...

***

Free market In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any o ...

***

Fair trade Fair trade is an arrangement designed to help producers in developing countries achieve sustainable and equitable trade relationships. The fair trade movement combines the payment of higher prices to exporters with improved social and enviro ...

** Unit of account ** Volatility ** Yield ** Yield curve

History

* History of finance *

History of banking The history of banking began with the first prototype banks, that is, the merchants of the world, who gave grain loans to farmers and traders who carried goods between cities. This was around 2000 BCE in Assyria, India and Sumeria. Later, in anci ...

History of insurance The history of insurance traces the development of the modern business of insurance against risks, especially regarding cargo, property, death, automobile accidents, and medical treatment. The insurance industry helps to eliminate risks (as w ...

* Tulip mania (Dutch Republic), 1620s/1630s *

South Sea Bubble South is one of the cardinal directions or compass points. The direction is the opposite of north and is perpendicular to both east and west. Etymology The word ''south'' comes from Old English ''sūþ'', from earlier Proto-Germanic ''*sunþaz ...

(UK) &

Mississippi Company The Mississippi Company (french: Compagnie du Mississippi; founded 1684, named the Company of the West from 1717, and the Company of the Indies from 1719) was a corporation holding a business monopoly in French colonies in North America and th ...

(France), 1710s; see also

Stock market bubble A stock market bubble is a type of economic bubble taking place in stock markets when market participants drive stock prices above their value in relation to some system of stock valuation. Behavioral finance theory attributes stock market bub ...

* '' Vix pervenit'' 1745, on usury and other dishonest profit *

Panic of 1837 The Panic of 1837 was a financial crisis in the United States that touched off a major depression, which lasted until the mid-1840s. Profits, prices, and wages went down, westward expansion was stalled, unemployment went up, and pessimism abound ...

(US) *

Railway Mania Railway Mania was an instance of a stock market bubble in the United Kingdom of Great Britain and Ireland in the 1840s. It followed a common pattern: as the price of railway shares increased, speculators invested more money, which further incre ...

(UK), 1840s * Erie War (US), 1860s * Long Depression, 1873–1896 (mainly US and Europe, though other parts of the world were affected) * Post-World War I hyperinflation; see Hyperinflation and Inflation in the Weimar Republic *

Wall Street Crash of 1929 The Wall Street Crash of 1929, also known as the Great Crash, was a major American stock market crash that occurred in the autumn of 1929. It started in September and ended late in October, when share prices on the New York Stock Exchange colla ...

Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...

1930s *

Bretton Woods Accord The Bretton Woods system of monetary management established the rules for commercial and financial relations among the United States, Canada, Western European countries, Australia, and Japan after the 1944 Bretton Woods Agreement. The Bret ...

1944 *

1973 oil crisis The 1973 oil crisis or first oil crisis began in October 1973 when the members of the Organization of Arab Petroleum Exporting Countries (OAPEC), led by Saudi Arabia, proclaimed an oil embargo. The embargo was targeted at nations that had supp ...

1979 energy crisis The 1979 oil crisis, also known as the 1979 Oil Shock or Second Oil Crisis, was an energy crisis caused by a drop in oil production in the wake of the Iranian Revolution. Although the global oil supply only decreased by approximately four per ...

* Savings and Loan Crisis 1980s *

Black Monday Black Monday refers to specific Mondays when undesirable or turbulent events have occurred. It has been used to designate massacres, military battles, and stock market crashes. Historic events *1209, Dublin – when a group of 500 recently arriv ...

1987 * Asian financial crisis 1990s *

Dot-com bubble The dot-com bubble (dot-com boom, tech bubble, or the Internet bubble) was a stock market bubble in the late 1990s, a period of massive growth in the use and adoption of the Internet. Between 1995 and its peak in March 2000, the Nasdaq Compo ...

1995-2001 * Stock market downturn of 2002 * United States housing bubble *

Financial crisis of 2007–08 Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fina ...

, followed by the

Great Recession The Great Recession was a period of marked general decline, i.e. a recession, observed in national economies globally that occurred from late 2007 into 2009. The scale and timing of the recession varied from country to country (see map). At ...

Finance terms by field

Accounting (financial record keeping)

Auditing An audit is an "independent examination of financial information of any entity, whether profit oriented or not, irrespective of its size or legal form when such an examination is conducted with a view to express an opinion thereon.” Auditing ...

* Accounting software *

Book keeping Bookkeeping is the recording of financial transactions, and is part of the process of accounting in business and other organizations. It involves preparing source documents for all transactions, operations, and other events of a business. ...

FASB The Financial Accounting Standards Board (FASB) is a private standard-setting body whose primary purpose is to establish and improve Generally Accepted Accounting Principles (GAAP) within the United States in the public's interest. The Securi ...

* Financial accountancy ** Financial statements ***

Balance sheet In financial accounting, a balance sheet (also known as statement of financial position or statement of financial condition) is a summary of the financial balances of an individual or organization, whether it be a sole proprietorship, a business ...

***

Cash flow statement In financial accounting, a cash flow statement, also known as ''statement of cash flows'', is a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to oper ...

***

Income statement An income statement or profit and loss accountProfessional English in Use - Finance, Cambridge University Press, p. 10 (also referred to as a ''profit and loss statement'' (P&L), ''statement of profit or loss'', ''revenue statement'', ''stateme ...

* Management accounting * Philosophy of Accounting *

Working capital Working capital (WC) is a financial metric which represents operating liquidity available to a business, organisation, or other entity, including governmental entities. Along with fixed assets such as plant and equipment, working capital is consi ...

* Hedge accounting ** IFRS 9 **

Fair value accounting Mark-to-market (MTM or M2M) or fair value accounting is accounting for the "fair value" of an asset or liability based on the current market price, or the price for similar assets and liabilities, or based on another objectively assessed "fair" ...

Banking

*See articles listed under:

Corporate finance

Balance sheet analysis In financial accounting, a balance sheet (also known as statement of financial position or statement of financial condition) is a summary of the financial balances of an individual or organization, whether it be a sole proprietorship, a business ...

Financial ratio A financial ratio or accounting ratio is a relative magnitude of two selected numerical values taken from an enterprise's financial statements. Often used in accounting, there are many standard ratios used to try to evaluate the overall financial ...

Business plan A business plan is a formal written document containing the goals of a business, the methods for attaining those goals, and the time-frame for the achievement of the goals. It also describes the nature of the business, background information on t ...

* Capital budgeting ** Investment policy ***

Business valuation Business valuation is a process and a set of procedures used to estimate the economic value of an owner's interest in a business. Here various valuation techniques are used by financial market participants to determine the price they are willing t ...

*** Stock valuation *** Fundamental analysis *** Real options *** Valuation topics *** Fisher separation theorem ** Sources of financing ** Securities **

Initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...

Capital structure In corporate finance, capital structure refers to the mix of various forms of external funds, known as capital, used to finance a business. It consists of shareholders' equity, debt (borrowed funds), and preferred stock, and is detailed in the ...

Cost of capital In economics and accounting, the cost of capital is the cost of a company's funds (both debt and equity), or from an investor's point of view is "the required rate of return on a portfolio company's existing securities". It is used to evaluate new ...

*** Weighted average cost of capital ***

Modigliani–Miller theorem The Modigliani–Miller theorem (of Franco Modigliani, Merton Miller) is an influential element of economic theory; it forms the basis for modern thinking on capital structure. The basic theorem states that in the absence of taxes, bankruptcy costs ...

***

Hamada's equation In corporate finance, Hamada’s equation is an equation used as a way to separate the financial risk of a levered firm from its business risk. The equation combines the Modigliani–Miller theorem with the capital asset pricing model. It is used t ...

Dividend policy Dividend policy is concerned with financial policies regarding paying cash dividend in the present or paying an increased dividend at a later stage. Whether to issue dividends, and what amount, is determined mainly on the basis of the company's una ...

***

Dividend A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-in ...

***

Dividend tax A dividend tax is a tax imposed by a jurisdiction on dividends paid by a corporation to its shareholders (stockholders). The primary tax liability is that of the shareholder, though a tax obligation may also be imposed on the corporation in the f ...

***

Dividend yield The dividend yield or dividend–price ratio of a share is the dividend per share, divided by the price per share. It is also a company's total annual dividend payments divided by its market capitalization, assuming the number of shares is constant ...

***

* Corporate action * (

Strategic Strategy (from Greek στρατηγία ''stratēgia'', "art of troop leader; office of general, command, generalship") is a general plan to achieve one or more long-term or overall goals under conditions of uncertainty. In the sense of the "art ...

) Financial management ** Managerial finance ** Management accounting *

Mergers and acquisitions Mergers and acquisitions (M&A) are business transactions in which the ownership of companies, other business organizations, or their operating units are transferred to or consolidated with another company or business organization. As an aspect ...

** leveraged buyout **

takeover In business, a takeover is the purchase of one company (the ''target'') by another (the ''acquirer'' or ''bidder''). In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to t ...

** corporate raid **

Contingent value rights In corporate finance, Contingent Value Rights (CVR) are rights granted by an acquirer to a company’s shareholders, facilitating the transaction where some uncertainty is inherent. CVRs may be separately tradeable securities; they are occasiona ...

* Real options * Working capital management **

***

Current assets In accounting, a current asset is any asset which can reasonably be expected to be sold, consumed, or exhausted through the normal operations of a business within the current fiscal year or operating cycle or financial year (whichever period is ...

***

Current liabilities In accounting, current liabilities are often understood as all liabilities of the business that are to be settled in cash within the fiscal year or the operating cycle of a given firm, whichever period is longer. A more complete definition is t ...

Return on investment Return on investment (ROI) or return on costs (ROC) is a ratio between net income (over a period) and investment (costs resulting from an investment of some resources at a point in time). A high ROI means the investment's gains compare favourably ...

***

Return on capital Return on capital (ROC), or return on invested capital (ROIC), is a ratio used in finance, valuation and accounting, as a measure of the profitability and value-creating potential of companies relative to the amount of capital invested by sharehold ...

*** Return on assets *** Return on equity ** loan covenant **

cash conversion cycle In management accounting, the Cash conversion cycle (CCC) measures how long a firm will be deprived of cash if it increases its investment in inventory in order to expand customer sales. It is thus a measure of the liquidity risk entailed by growt ...

** Cash management *** **

Inventory optimization Inventory optimization is a method of balancing capital investment constraints or objectives and service-level goals over a large assortment of stock-keeping units (SKUs) while taking demand and supply volatility into account. Inventory managem ...

***

Supply chain management In commerce, supply chain management (SCM) is the management of the flow of goods and services including all processes that transform raw materials into final products between businesses and locations. This can include the movement and stor ...

*** Just In Time (JIT) *** Economic order quantity (EOQ) *** Economic production quantity (EPQ) ***

Economic batch quantity In inventory management, Economic Batch Quantity (EBQ), also known as Optimum Batch Quantity (OBQ) is a measure used to determine the quantity of units that can be produced at the minimum average costs in a given batch or product run. EBQ is basical ...

Credit (finance) Credit (from Latin verb ''credit'', meaning "one believes") is the trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately (thereby generating a debt), ...

** Credit scoring **

Default risk A credit risk is risk of default on a debt that may arise from a borrower failing to make required payments. In the first resort, the risk is that of the lender and includes lost principal and interest, disruption to cash flows, and increased c ...

Discounts and allowances Discounts and allowances are reductions to a basic price of goods or services. They can occur anywhere in the distribution channel, modifying either the manufacturer's list price (determined by the manufacturer and often printed on the package) ...

** Factoring (trade) &

Supply chain finance Supply chain financing (or reverse factoring) is a form of financial transaction wherein a third party facilitates an exchange by financing the supplier on the customer's behalf. Also it refers to the techniques and practices used by banks and ...

Investment management

Active management Active management (also called ''active investing'') is an approach to investing. In an actively managed portfolio of investments, the investor selects the investments that make up the portfolio. Active management is often compared to passive man ...

* Efficient market hypothesis * Portfolio * Modern portfolio theory **

* Arbitrage pricing theory * Passive management **

Index fund An index fund (also index tracker) is a mutual fund or exchange-traded fund (ETF) designed to follow certain preset rules so that the fund can a specified basket of underlying investments.Reasonable Investor(s), Boston University Law Review, avail ...

Activist shareholder An activist shareholder is a shareholder who uses an equity stake in a corporation to put pressure on its management. A fairly small stake (less than 10% of outstanding shares) may be enough to launch a successful campaign. In comparison, a full ta ...

Mutual fund A mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. The term is typically used in the United States, Canada, and India, while similar structures across the globe include the SICAV i ...

** Open-end fund **

Closed-end fund A closed-end fund (CEF) is a fund that raises capital by issuing a fixed number of shares which are not redeemable, and then invest that capital in financial assets such as stocks and bonds. Unlike open-end funds, new shares in a closed-end fund ...

** List of mutual-fund families * Financial engineering **

Long-Term Capital Management Long-Term Capital Management L.P. (LTCM) was a highly-leveraged hedge fund. In 1998, it received a $3.6 billion bailout from a group of 14 banks, in a deal brokered and put together by the Federal Reserve Bank of New York. LTCM was founded in 1 ...

Hedge fund A hedge fund is a pooled investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction, and risk management techniques in an attempt to improve performance, such as sho ...

* #Quantitative investing, below

Personal finance

529 plan 5 (five) is a number, numeral and digit. It is the natural number, and cardinal number, following 4 and preceding 6, and is a prime number. It has attained significance throughout history in part because typical humans have five digits on eac ...

(US college savings) * ABLE account (US plan for benefit of individuals with disabilities) * Asset allocation **

Asset location Asset location (AL) is a term used in personal finance to refer to how investors distribute their investments across savings vehicles including taxable accounts, tax-exempt accounts (e.g., TFSA, Roth IRA, ISAs, TESSAs), tax-deferred accounts (e.g. ...

Budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmenta ...

Coverdell Education Savings Account A Coverdell education savings account (also known as an education savings account, a Coverdell ESA, a Coverdell account, or just an ESA, and formerly known as an education individual retirement account), is a tax advantaged investment account in the ...

(Coverdell ESAs, formerly known as Education IRAs) * Credit and debt **

Credit card A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based on the cardholder's accrued debt (i.e., promise to the card issuer to pay them for the amounts plus the o ...

** Debt consolidation **

Mortgage loan A mortgage loan or simply mortgage (), in civil law jurisdicions known also as a hypothec loan, is a loan used either by purchasers of real property to raise funds to buy real estate, or by existing property owners to raise funds for any p ...

***

Continuous-repayment mortgage Analogous to continuous compounding, a continuous annuity is an ordinary annuity in which the payment interval is narrowed indefinitely. A (theoretical) continuous repayment mortgage is a mortgage loan paid by means of a continuous annuity. Mo ...

Debit card A debit card, also known as a check card or bank card is a payment card that can be used in place of cash to make purchases. The term '' plastic card'' includes the above and as an identity document. These are similar to a credit card, but u ...

Direct deposit A direct deposit (or direct credit), in banking, is a deposit of money by a payer directly into a payee's bank account. Direct deposits are most commonly made by businesses in the payment of salaries and wages and for the payment of suppliers' acco ...

Employment contract An employment contract or contract of employment is a kind of contract used in labour law to attribute rights and responsibilities between parties to a bargain. The contract is between an "employee" and an "employer". It has arisen out of the old ...

** Commission **

Employee stock option Employee stock options (ESO) is a label that refers to compensation contracts between an employer and an employee that carries some characteristics of financial options. Employee stock options are commonly viewed as an internal agreement prov ...

** Employee or fringe benefit **

Health insurance Health insurance or medical insurance (also known as medical aid in South Africa) is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. As with other types of insurance, risk is shared among ma ...

Paycheck A paycheck, also spelled paycheque, pay check or pay cheque, is traditionally a paper document (a cheque) issued by an employer to pay an employee for services rendered. In recent times, the physical paycheck has been increasingly replaced by e ...

** Salary **

Wage A wage is payment made by an employer to an employee for work done in a specific period of time. Some examples of wage payments include compensatory payments such as ''minimum wage'', ''prevailing wage'', and ''yearly bonuses,'' and remuner ...

* Financial literacy *

Insurance Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...

Predatory lending Predatory lending refers to unethical practices conducted by lending organizations during a loan origination process that are unfair, deceptive, or fraudulent. While there are no internationally agreed legal definitions for predatory lending, a 2006 ...

* Retirement plan ** Australia –

Superannuation in Australia In Australia, superannuation, or just super, is the term for retirement pension benefit funds. Employers make compulsory contributions into these funds on behalf of their employees. Superannuation is compulsory for all employed people workin ...

** Canada *** Registered retirement savings plan ***

Tax-free savings account A tax-free savings account (TFSA, french: links=no, Compte d'épargne libre d'impôt, CELI) is an account available in Canada that provides tax benefits for saving. Investment income, including capital gains and dividends, earned in a TFSA is n ...

** Japan –

Nippon individual savings account A Nippon individual savings account (NISA) is an account that is meant to help residents in Japan save money with tax-exempt benefits. It is modeled after the Individual Savings Account in the United Kingdom. History NISA was created in 2014 as ...

** New Zealand –

KiwiSaver The KiwiSaver scheme, a New Zealand savings scheme, came into operation from Monday, 2 July 2007. Participants can normally access their KiwiSaver funds only after the age of 65, but can withdraw them in certain limited circumstances, for exampl ...

** United Kingdom ***

Individual savings account An individual savings account (ISA; ) is a class of retail investment arrangement available to residents of the United Kingdom. First introduced in 1999, the accounts have favourable tax status. Payments into the account are made from after-tax i ...

***

Self-invested personal pension A self-invested personal pension (SIPP) is the name given to the type of UK government-approved personal pension scheme which allows individuals to make their own investment decisions from the full range of investments approved by HM Revenue and C ...

** United States ***

401(a) In the United States, a 401(a) plan is a tax-deferred retirement savings plan defined by subsection 401(a) of the Internal Revenue Code. The 401(a) plan is established by an employer, and allows for contributions by the employer or both employer an ...

***

401(k) In the United States, a 401(k) plan is an employer-sponsored, defined-contribution, personal pension (savings) account, as defined in subsection 401(k) of the U.S. Internal Revenue Code. Periodical employee contributions come directly out of their ...

***

403(b) In the United States, a 403(b) plan is a U.S. tax-advantaged retirement savings plan available for public education organizations, some non-profit employers (only Internal Revenue Code 501(c)(3) organizations), cooperative hospital service organiza ...

***

457 plan The 457 plan is a type of nonqualified, tax advantaged deferred-compensation retirement plan that is available for governmental and certain nongovernmental employers in the United States. The employer provides the plan and the employee defers comp ...

***

Keogh plan Keogh plans are a type of retirement plan for self-employed people and small businesses in the United States. History Named for U.S. Representative Eugene James Keogh of New York, they are sometimes called HR10 plans. IRS Publication 560 refer ...

*** Individual retirement account ****

Roth IRA A Roth IRA is an individual retirement account (IRA) under United States law that is generally not taxed upon distribution, provided certain conditions are met. The principal difference between Roth IRAs and most other tax-advantaged retirement pla ...

****

Traditional IRA A traditional IRA is an individual retirement arrangement (IRA), established in the United States by the Employee Retirement Income Security Act of 1974 (ERISA) (, codified in part at ). Normal IRAs also existed before ERISA. Overview An author de ...

**** SEP IRA **** SIMPLE IRA **

Pension A pension (, from Latin ''pensiō'', "payment") is a fund into which a sum of money is added during an employee's employment years and from which payments are drawn to support the person's retirement from work in the form of periodic payments ...

Simple living Simple living refers to practices that promote simplicity in one's lifestyle. Common practices of simple living include reducing the number of possessions one owns, depending less on technology and services, and spending less money. Not only is ...

Social security Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specificall ...

Tax advantage Tax advantage refers to the economic bonus which applies to certain accounts or investments that are, by statute, tax-reduced, tax-deferred, or tax-free. Examples of tax-advantaged accounts and investments include retirement plans, education saving ...

Wealth Wealth is the abundance of Value (economics), valuable financial assets or property, physical possessions which can be converted into a form that can be used for financial transaction, transactions. This includes the core meaning as held in the ...

Comparison of accounting software The following comparison of accounting software documents the various features and differences between different professional accounting software, personal and small enterprise software, medium-sized and large-sized enterprise software, and oth ...

* Personal financial management *

Investment club An investment club is a group of individuals who meet for the purpose of pooling money and investing; members typically meet on a periodic basis to make investment decisions as a group through a voting process and recording of minutes, or gather i ...

Collective investment scheme An investment fund is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group such as reducing the risks of the investment by a significant percentage. These advantages inc ...

Public finance

Central bank A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union, and oversees their commercial banking system. In contrast to a commercial bank, a central ba ...

Federal Reserve The Federal Reserve System (often shortened to the Federal Reserve, or simply the Fed) is the central banking system of the United States of America. It was created on December 23, 1913, with the enactment of the Federal Reserve Act, after a ...

Fractional-reserve banking Fractional-reserve banking is the system of banking operating in almost all countries worldwide, under which banks that take deposits from the public are required to hold a proportion of their deposit liabilities in liquid assets as a reserve, ...

Deposit creation multiplier Money creation, or money issuance, is the process by which the money supply of a country, or of an economic or monetary region,Such as the Eurozone or ECCAS is increased. In most modern economies, money creation is controlled by the central bank ...

* Tax ** Capital gains tax **

Estate tax An inheritance tax is a tax paid by a person who inherits money or property of a person who has died, whereas an estate tax is a levy on the estate (money and property) of a person who has died. International tax law distinguishes between an es ...

(and

inheritance tax An inheritance tax is a tax paid by a person who inherits money or property of a person who has died, whereas an estate tax is a levy on the estate (money and property) of a person who has died. International tax law distinguishes between an es ...

) **

Gift tax In economics, a gift tax is the tax on money or property that one living person or corporate entity gives to another. A gift tax is a type of transfer tax that is imposed when someone gives something of value to someone else. The transfer must ...

Income tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...

Inheritance tax An inheritance tax is a tax paid by a person who inherits money or property of a person who has died, whereas an estate tax is a levy on the estate (money and property) of a person who has died. International tax law distinguishes between an es ...

** Payroll tax **

Property tax A property tax or millage rate is an ad valorem tax on the value of a property.In the OECD classification scheme, tax on property includes "taxes on immovable property or net wealth, taxes on the change of ownership of property through inheri ...

(including land value tax) **

Sales tax A sales tax is a tax paid to a governing body for the sales of certain goods and services. Usually laws allow the seller to collect funds for the tax from the consumer at the point of purchase. When a tax on goods or services is paid to a govern ...

(including

value added tax A value-added tax (VAT), known in some countries as a goods and services tax (GST), is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the end ...

excise tax file:Lincoln Beer Stamp 1871.JPG, upright=1.2, 1871 U.S. Revenue stamp for 1/6 barrel of beer. Brewers would receive the stamp sheets, cut them into individual stamps, cancel them, and paste them over the Bunghole, bung of the beer barrel so when ...

, and use tax) **

Transfer tax A transfer tax is a tax on the passing of title to property from one person (or entity) to another. In a narrow legal sense, a transfer tax is essentially a transaction fee imposed on the transfer of title to property from one entity to another. ...

(including

stamp duty Stamp duty is a tax that is levied on single property purchases or documents (including, historically, the majority of legal documents such as cheques, receipts, military commissions, marriage licences and land transactions). A physical revenu ...

) **

** Tax, tariff and trade **

Tax amortization benefit In accounting, tax amortization benefit (or tax amortisation benefit) refers to the present value of income tax savings resulting from the tax deduction generated by the amortization of an intangible asset. Intangible asset valuation When the purc ...

* Crowding out *

Industrial policy An industrial policy (IP) or industrial strategy of a country is its official strategic effort to encourage the development and growth of all or part of the economy, often focused on all or part of the manufacturing sector. The government takes m ...

* Agricultural policy * Currency union *

Risk management

Constraint finance

Environmental finance Environmental finance is a field within finance that employs market-based environmental policy instruments to improve the ecological impact of investment strategies. The primary objective of environmental finance is to regress the negative impact ...

Feminist economics Feminist economics is the critical study of economics and economies, with a focus on gender-aware and inclusive economic inquiry and policy analysis. Feminist economic researchers include academics, activists, policy theorists, and practition ...

* Green economics * Islamic economics *

Uneconomic growth Uneconomic growth is economic growth that reflects or creates a decline in the quality of life. The concept is used in human development theory, welfare theory, and ecological economics. It is usually attributed to ecological economist Herman ...

* Value of Earth * Value of life

Insurance

* Actuarial science *

Annuities In investment, an annuity is a series of payments made at equal intervals.Kellison, Stephen G. (1970). ''The Theory of Interest''. Homewood, Illinois: Richard D. Irwin, Inc. p. 45 Examples of annuities are regular deposits to a savings account, mo ...

Catastrophe modeling :''This article refers to the use of computers to estimate losses caused by disasters. For other meanings of the word catastrophe, including catastrophe theory in mathematics, see catastrophe (disambiguation).'' Catastrophe modeling (also known ...

Earthquake loss Earthquake insurance is a form of property insurance that pays the policyholder in the event of an earthquake that causes damage to the property. Most ordinary homeowners insurance policies do not cover earthquake damage. Most earthquake insuranc ...

* Extended coverage *

Insurable interest Insurable interest exists when an insured person derives a financial or other kind of benefit from the continuous existence, without repairment or damage, of the insured object (or in the case of a person, their continued survival). A person has an ...

* Insurable risk *

***

Disability insurance Disability Insurance, often called DI or disability income insurance, or income protection, is a form of insurance that insures the beneficiary's earned income against the risk that a disability creates a barrier for completion of core work func ...

*** Accident insurance *** Flexible spending account ***

Health savings account A health savings account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan (HDHP). The funds contributed to an account are not subject to federal inco ...

***

Long term care insurance Long-term care insurance (LTC or LTCI) is an insurance product, sold in the United States, United Kingdom and Canada that helps pay for the costs associated with long-term care. Long-term care insurance covers care generally not covered by health ...

*** Medical savings account **

Life insurance Life insurance (or life assurance, especially in the Commonwealth of Nations) is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death ...

***

Life insurance tax shelter A life insurance tax shelter uses investments in insurance to protect income or assets from tax liabilities. Life insurance proceeds are not taxable in many jurisdictions. Since most other forms of income are taxable (such as capital gains, divid ...

***

Permanent life insurance Life insurance (or life assurance, especially in the Commonwealth of Nations) is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death ...

***

Term life insurance Term life insurance or term assurance is life insurance that provides coverage at a fixed rate of payments for a limited period of time, the relevant term. After that period expires, coverage at the previous rate of premiums is no longer guarant ...

***

Universal life insurance Universal life insurance (often shortened to UL) is a type of cash value life insurance, sold primarily in the United States. Under the terms of the policy, the excess of premium payments above the current cost of insurance is credited to the cash ...

*** Variable universal life insurance ***

Whole life insurance Whole life insurance, or whole of life assurance (in the Commonwealth of Nations), sometimes called "straight life" or "ordinary life", is a life insurance policy which is guaranteed to remain in force for the insured's entire lifetime, provided r ...

** Property insurance *** Auto insurance *** Boiler insurance ***

Business interruption insurance Business interruption insurance (also known as business income insurance) is a type of insurance that covers the loss of income that a business suffers after a disaster. The income loss covered may be due to disaster-related closing of the business ...

***

Condo insurance A condominium (or condo for short) is an ownership structure whereby a building is divided into several units that are each separately owned, surrounded by common areas that are jointly owned. The term can be applied to the building or complex ...

*** Earthquake insurance ***

Home insurance Home insurance, also commonly called homeowner's insurance (often abbreviated in the US real estate industry as HOI), is a type of property insurance that covers a private residence. It is an insurance policy that combines various personal insura ...

*** Title insurance ***

Pet insurance Pet insurance is a form of insurance that pays, partly or in total, for veterinary treatment of the insured person's ill or injured pet. Some policies will pay out when the pet dies, or if the pet is lost or stolen. As veterinary medicine is incr ...

*** Renters' insurance **

Casualty insurance Casualty insurance is a defined term which broadly encompasses insurance not directly concerned with life insurance, health insurance, or property insurance. Casualty insurance is mainly liability coverage of an individual or organization for ne ...

*** Fidelity bond *** Liability insurance ***

Political risk insurance Political risk insurance is a type of insurance that can be taken out by businesses, of any size, against political risk—the risk that revolution or other political conditions will result in a loss. Political risk insurance is available for sever ...

***

Surety bond In finance, a surety , surety bond or guaranty involves a promise by one party to assume responsibility for the debt obligation of a borrower if that borrower defaults. Usually, a surety bond or surety is a promise by a surety or guarantor to pay ...

***

Terrorism insurance Terrorism insurance is insurance purchased by property owners to cover their potential losses and liabilities that might occur due to terrorist activities. It is considered to be a difficult product for insurance companies, as the odds of terroris ...

** Credit insurance *** Trade credit insurance ***

Payment protection insurance Payment protection insurance (PPI), also known as credit insurance, credit protection insurance, or loan repayment insurance, is an insurance product that enables consumers to ensure repayment of credit if the borrower dies, becomes ill or disabl ...

*** Credit derivative **

Mid-term adjustment {{distinguish, Mid-year adjustment In insurance, mid-term adjustment (MTA), also called a mid-term modification or mid-term change, refers to a change to an insurance policy prior to the end of the policy period (when coverage is offered). The cha ...

Reinsurance Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself (at least in part) from the risk of a major claims event. With reinsurance, the company passes on ("cedes") some part of its own insu ...

Self insurance Self-insurance is a situation in which a person or business that is liable for some risk does not take out any third-party insurance, but rather chooses to bear the risk itself. In the United States the concept applies especially to self-funded hea ...

Travel insurance Travel insurance is an insurance product for covering unforeseen losses incurred while travelling, either internationally or domestically. Basic policies generally only cover emergency medical expenses while overseas, while comprehensive policies ...

Niche insurance Niche insurance is insurance provided for small, low-demand markets. It is outside of the usual insurance types available, such as automobile, home, life, travel, and business insurance, and can be very difficult to obtain. A few examples are: * I ...

Insurance contract In insurance, the insurance policy is a contract (generally a standard form contract) between the insurer and the policyholder, which determines the claims which the insurer is legally required to pay. In exchange for an initial payment, known as ...

* Loss payee clause *

Risk Retention Group A risk retention group (RRG) in business economics is an alternative risk transfer entity in the United States created under the federal Liability Risk Retention Act (LRRA). RRGs must form as liability insurance companies under the laws of at least ...

Economics and finance

Finance-related areas of economics

Financial economics Financial economics, also known as finance, is the branch of economics characterized by a "concentration on monetary activities", in which "money of one type or another is likely to appear on ''both sides'' of a trade".William F. Sharpe"Financial ...

Monetary economics Monetary economics is the branch of economics that studies the different competing theories of money: it provides a framework for analyzing money and considers its functions (such as medium of exchange, store of value and unit of account), and it ...

Mathematical economics Mathematical economics is the application of mathematical methods to represent theories and analyze problems in economics. Often, these applied methods are beyond simple geometry, and may include differential and integral calculus, difference an ...

* Managerial economics *

Economic growth Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate of ...

theory * Decision theory *

Game theory Game theory is the study of mathematical models of strategic interactions among rational agents. Myerson, Roger B. (1991). ''Game Theory: Analysis of Conflict,'' Harvard University Press, p.&nbs1 Chapter-preview links, ppvii–xi It has appli ...

* Experimental economics /

Experimental finance The goals of experimental finance are to understand human and market behavior in settings relevant to finance. Experiments are synthetic economic environments created by researchers specifically to answer research questions. This might involve, for ...

Behavioral economics Behavioral economics studies the effects of psychological, cognitive, emotional, cultural and social factors on the decisions of individuals or institutions, such as how those decisions vary from those implied by classical economic theory. ...

/ Behavioral finance

Corporate finance theory

* Fisher separation theorem *

*Theory of the firm *The Theory of Investment Value *Agency theory *

** **Capital structure substitution theory **Pecking order theory **Market timing hypothesis **Trade-off theory of capital structure **Merton model **Tax shield *

** **Dividend policy#Walter's model, Walter model **Gordon model **John Lintner#Lintner's dividend policy model, Lintner model **Dividend policy#Residuals theory of dividends, Residuals theory **Clientele effect **Dividend puzzle ** **

* Capital budgeting (valuation) ** **Clean surplus accounting **Residual income valuation **Economic value added / Market value added **T-model **Adjusted present value **uncertainty ***Penalized present value ***Expected commercial value ***rNPV, Risk-adjusted net present value ***Contingent claim valuation ***Real options ***Monte Carlo methods in finance#Overview, Monte Carlo methods *Risk management ** **Financial risk management#Economic perspective, Hedging irrelevance proposition **Risk modeling **Risk-adjusted return on capital

Asset pricing theory

*Value (economics) **Fair value **Intrinsic value (finance), Intrinsic value **Market price **Expected value **Opportunity cost **Risk premium **#Underlying theory below *Equilibrium price **market efficiency **economic equilibrium **rational expectations **Risk factor (finance) *General equilibrium theory **Supply and demand **Competitive equilibrium **Economic equilibrium **Partial equilibrium *Arbitrage-free price **Rational pricing ***Rational pricing#Arbitrage free pricing, § Arbitrage free pricing ***Rational pricing#Risk neutral valuation, § Risk neutral valuation **Contingent claim analysis **Brownian model of financial markets **Complete market & Incomplete markets *Utility **Risk aversion **Expected utility hypothesis **Utility maximization problem **Marginal utility **Generalized expected utility *Economic efficiency **Efficient-market hypothesis **efficient frontier **Production–possibility frontier **Allocative efficiency **Pareto efficiency **Productive efficiency *State prices **Arrow–Debreu model **Stochastic discount factor **Pricing kernel **application: *** *** *Fundamental theorem of asset pricing ** Rational pricing ** Arbitrage-free **No free lunch with vanishing risk **Self-financing portfolio **Stochastic dominance ***Marginal conditional stochastic dominance *Martingale pricing **Brownian model of financial markets **Random walk hypothesis **Risk-neutral measure **Martingale (probability theory) ***Sigma-martingale ***Semimartingale *Quantum finance

Asset pricing models

*Equilibrium pricing **Equities; foreign exchange and commodities ***

***Consumption-based capital asset pricing model, Consumption-based CAPM ***Intertemporal CAPM ***Single-index model ***Multiple factor models ****Fama–French three-factor model ****Carhart four-factor model *** Arbitrage pricing theory **Bonds; other interest rate instruments ***Vasicek model, Vasicek ***Rendleman–Bartter model, Rendleman–Bartter ***Cox–Ingersoll–Ross model, Cox–Ingersoll–Ross *Risk neutral pricing **Equities; foreign exchange and commodities; interest rates ***Black–Scholes model, Black–Scholes ***Black model, Black ***Garman–Kohlhagen model, Garman–Kohlhagen ***Heston model, Heston ***Constant elasticity of variance model, CEV ***SABR volatility model, SABR **Bonds; other interest rate instruments ***Ho–Lee model, Ho–Lee ***Hull–White model, Hull–White ***Black–Derman–Toy model, Black–Derman–Toy ***Black–Karasinski model, Black–Karasinski ***Kalotay–Williams–Fabozzi model, Kalotay–Williams–Fabozzi ***Longstaff–Schwartz model, Longstaff–Schwartz ***Chen model, Chen ***Rendleman–Bartter model, Rendleman–Bartter ***Heath–Jarrow–Morton framework, Heath–Jarrow–Morton ****Cheyette model, Cheyette ***Brace-Gatarek-Musiela model, Brace–Gatarek–Musiela ****LIBOR market model

Mathematics and finance

Time value of money

* Present value * Future value * Discounting * Net present value *

* Annuity *

Financial mathematics

Mathematical tools

*Probability **Probability distribution ***Binomial distribution ***Log-normal distribution ***Poisson distribution *Stochastic calculus **Brownian motion ***Geometric Brownian motion **Cameron–Martin theorem **Feynman–Kac formula **Girsanov's theorem **Itô's lemma **Martingale representation theorem **Radon–Nikodym derivative **Stochastic differential equations **Stochastic process ***Jump process ***Lévy process ***Markov process ***Ornstein–Uhlenbeck process ***Wiener process *Monte Carlo methods **Low-discrepancy sequence **Monte Carlo integration **Quasi-Monte Carlo method **Random number generation *Partial differential equations **Finite difference method **Heat equation **Numerical partial differential equations ***Crank–Nicolson method ***Finite difference#Numerical analysis, Finite difference method: Numerical analysis * Volatility **Autoregressive conditional heteroskedasticity#ARCH.28q.29 model Specification, ARCH model **Autoregressive conditional heteroskedasticity#GARCH, GARCH model **Stochastic volatility **Stochastic volatility jump

Derivatives pricing

*Underlying logic (see also #Economics and finance above) ** Rational pricing ***Risk-neutral measure ***Arbitrage-free pricing **Brownian model of financial markets **Martingale pricing *Forward contract **Forward contract#Spot - forward parity, Forward contract pricing *

**Futures contract#Pricing, Futures contract pricing *Option (finance), Options (incl. Real options valuation#Valuation, Real options and Employee stock option#Valuation, ESOs) **Valuation of options ** Black–Scholes formula *** Approximations for American options ****Barone-Adesi and Whaley ****Bjerksund and Stensland ****Black's approximation ****Optimal stopping ****Black–Scholes model#American options, Roll–Geske–Whaley ** Black model ** Binomial options model ** Finite difference methods for option pricing ** Foreign exchange option#Valuation: the Garman–Kohlhagen model, Garman–Kohlhagen model ** The Greeks (finance), The Greeks ** Lattice model (finance) ** Margrabe's formula ** Monte Carlo methods for option pricing ***Monte Carlo methods in finance ***Quasi-Monte Carlo methods in finance ***Monte Carlo methods for option pricing#Least Square Monte Carlo, Least Square Monte Carlo for American options ** Trinomial tree ** Volatility *** Implied volatility *** Volatility (finance), Historical volatility *** Volatility smile (& Volatility smile#Implied volatility surface, Volatility surface) *** Stochastic volatility **** Constant elasticity of variance model **** Heston model **** SABR volatility model *** Local volatility ****Implied binomial tree ****Implied trinomial tree ****Edgeworth binomial tree ****Johnson binomial tree *Swap (finance), Swaps **Swap (finance)#Valuation and Pricing, Swap valuation *** *** *** *** ****Multi-curve framework *** *Interest rate derivatives (bond options, swaptions, interest rate cap and floor, caps and floors, and Interest rate derivative#Types, others) **Black model ***Interest rate cap and floor#Black model, caps and floors ***Swaption#Valuation, swaptions ***Bond option#Valuation, Bond options **

s (generally applied via Lattice model (finance), lattice based- and Monte Carlo methods for option pricing, specialized simulation-models, although "Black like" formulae exist in some cases.) ***Rendleman–Bartter model ***

***Ho–Lee model ***

***

***Black–Karasinski model ***

***Kalotay–Williams–Fabozzi model ***Longstaff–Schwartz model ***

**Forward interest rate, Forward rate / Forward curve -based models (Application as per short-rate models) ***LIBOR market model (also called: Brace–Gatarek–Musiela Model, BGM) ***Heath–Jarrow–Morton framework, Heath–Jarrow–Morton Model (HJM) ***Cheyette model *Valuation adjustments **Credit valuation adjustment **XVA * Yield curve modelling **Multi-curve framework **Bootstrapping (finance) ** ** **Nelson-Siegel **

Portfolio mathematics

*#Mathematical techniques below * #Quantitative investing below * *Portfolio optimization **Portfolio optimization#Optimization methods, § Optimization methods **Portfolio optimization#Mathematical tools, § Mathematical tools *Merton's portfolio problem *Kelly criterion *Roy's safety-first criterion *Specific applications: **Black–Litterman model **Universal portfolio algorithm **Markowitz model **Treynor–Black model

Financial markets

Market and instruments

* Capital markets * Security (finance), Securities * Financial markets * Primary market *

* Aftermarket (finance), Aftermarket *

* Bull market * Bear market * Bear market rally * Market maker * Dow Jones Industrial Average * Nasdaq * List of stock exchanges * List of stock market indices * List of corporations by market capitalization * Value Line Composite Index

Equity market

* Stock market * Stock * Common stock * Preferred stock * Treasury stock * Equity investment * Index investing * Private Equity * Financial reports and statements * Fundamental analysis *

* Stock split

Equity valuation

* Dow theory * Elliott wave principle * Economic value added * Fibonacci retracement * Gordon model * Growth stock ** PEG ratio ** PVGO *

* Leveraged buyout * Takeover * Corporate raid * PE ratio * Market capitalization * Income per share * Stock valuation * Technical analysis * Chart patterns * V-trend * Paper valuation

Investment theory

*Behavioral finance *Dead cat bounce * Efficient market hypothesis *Market microstructure *Stock market crash *

*January effect *Mark Twain effect *Quantitative behavioral finance *Quantitative analysis (finance) *Statistical arbitrage

Bond market

* Bond (finance) * Zero-coupon bond * Junk bonds * Convertible bond * Accrual bond * Municipal bond * Sovereign bond * Bond valuation ** Yield to maturity ** Bond duration ** Bond convexity * Fixed income

Money market

* Repurchase agreement * International Money Market *

* Exchange rate * ISO 4217, International currency codes * Table of historical exchange rates

Commodity market

* Commodity ** Asset ** Commodity Futures Trading Commission ** Trade, Commodity trade ** Drawdown (economics), Drawdowns ** Forfaiting ** Fundamental analysis ** Futures contract ** Fungibility ** Gold as an investment ** Hedge (finance), Hedging ** Jesse Lauriston Livermore ** List of traded commodities ** Ownership equity ** Position trader (futures), Position trader ** Risk (Futures) ** Seasonal traders ** Seasonal spread trading ** slippage (finance), Slippage **

** Spread trade ** Technical analysis *** Breakout (technical analysis), Breakout *** Bear market *** Bottom (technical analysis) *** Bull market *** MACD *** moving average (finance), Moving average *** Open interest (futures), Open Interest *** Parabolic SAR *** Point and figure charts *** Resistance (technical analysis), Resistance *** Relative Strength Index, RSI *** Stochastic oscillator *** Stop loss order, Stop loss *** Support (technical analysis), Support *** Top (technical analysis) **

** Market trend, Trend

Derivatives market

*Derivative (finance) *(see also List of finance topics#Mathematics and finance, Financial mathematics topics; Financial mathematics#Derivatives pricing, Derivatives pricing) * Underlying instrument

Forward markets and contracts

* Forward contract

Futures markets and contracts

* Backwardation * Contango * Futures contract ** Financial future ***Currency future ***Interest rate future ***Single-stock futures ***Stock market index future * Futures exchange

Option markets and contracts

* Option (finance), Options ** Stock option *** Box spread (options), Box spread *** Call option *** Put option *** Strike price *** Put–call parity *** The Greeks (finance), The Greeks *** Black–Scholes formula *** Black model *** Binomial options model *** Implied volatility *** Option time value ***Moneyness ****At-the-money ****In-the-money ****Out-of-the-money *** Straddle *** Option style **** Vanilla option **** Exotic option **** Binary option **** European option ***** Interest rate floor ***** Interest rate cap **** Bermudan option **** American option **** Quanto option **** Asian option ***

** Warrant (finance), Warrants ** Foreign exchange option ** Interest rate options ** Bond options ** Real options ** Futures contract#Options on futures, Options on futures

Swap markets and contracts

* Swap (finance) ** Interest rate swap ** Basis swap ** Asset swap ** Forex swap ** Stock swap ** Equity swap ** Currency swap ** Variance swap

Derivative markets by underlyings

= Equity derivatives

= *Contract for difference (CFD) *Exchange-traded fund (ETF) **

**Inverse exchange-traded fund *Equity options *Equity swap *Real estate investment trust (REIT) *Warrant (finance), Warrants **Covered warrant

= Interest rate derivatives

= * LIBOR * Forward rate agreement * Interest rate swap * Interest rate cap * Exotic interest rate option * Bond option * Interest rate future * Money market instruments * Range accrual Swaps/Notes/Bonds * In-arrears Swap * Constant maturity swap (CMS) or Constant Treasury Swap (CTS) derivatives (swaps, caps, floors) * Interest rate Swaption * Bermudan swaptions * Cross currency swaptions * Power Reverse Dual Currency note (PRDC or Turbo) * Target redemption note (TARN) * CMS steepener * Snowball * Inverse floater * Strips of Collateralized mortgage obligation * Ratchet caps and floors

= Credit derivatives

= * Credit default swap * Collateralized debt obligation * Credit default option * Total return swap * Securitization ** Strip financing

= Foreign exchange derivative

= *Basis swap *Currency future *Currency swap *Binary option#Foreign exchange, Foreign exchange binary option *Foreign exchange market#Forward, Foreign exchange forward *Foreign exchange option *Forward exchange rate *Foreign exchange swap *Foreign exchange hedge *Non-deliverable forward *Power reverse dual-currency note

Financial regulation

* Corporate governance * Financial regulation ** Bank regulation *** Banking license * License

Designations and accreditation

* Certified Financial Planner * Chartered Financial Analyst ** CFA Institute * Chartered Alternative Investment Analyst * Professional risk manager * Chartered Financial Consultant * Canadian Securities Institute * Independent financial adviser ** Chartered Insurance Institute * Financial risk manager * Chartered Market Technician * Certified Financial Technician

Litigation

* Liabilities Subject to Compromise

Fraud

* Forex scam * Insider trading * Legal origins theory * Petition mill * Ponzi scheme

Industry bodies

* International Swaps and Derivatives Association * National Association of Securities Dealers

Regulatory bodies

International

* Bank for International Settlements * International Organization of Securities Commissions * Security Commission * Basel Committee on Banking Supervision * Basel Accords – Basel I, Basel II, Basel III * International Association of Insurance Supervisors * International Accounting Standards Board

European Union

* European Securities Committee (European Union, EU) * Committee of European Securities Regulators (European Union, EU)

Regulatory bodies by country

=United Kingdom

= * Financial Conduct Authority * Prudential Regulation Authority (United Kingdom)

=United States

= * Commodity Futures Trading Commission *

* Federal Trade Commission * Municipal Securities Rulemaking Board * Office of the Comptroller of the Currency * U.S. Securities and Exchange Commission, Securities and Exchange Commission

United States legislation

* Glass–Steagall Act (US) * Gramm–Leach–Bliley Act (US) * Sarbanes–Oxley Act (US) * Securities Act of 1933 (US) * Securities Exchange Act of 1934 (US) * Investment Advisers Act of 1940 (US) * USA PATRIOT Act

Actuarial topics

* Actuarial topics

Valuation

Underlying theory

*Value (economics) *Valuation (finance) and specifically Valuation (finance)#Valuation overview, § Valuation overview *"The Theory of Investment Value" * *Valuation risk *Real versus nominal value (economics) *Real prices and ideal prices *Fair value **

*Intrinsic value (finance), Intrinsic value *Market price *Value in use *Fairness opinion *Asset pricing (see also #Asset pricing theory above) **Equilibrium price ***market efficiency ***economic equilibrium ***rational expectations **Arbitrage-free price *** ***

Context

* (Corporate bond, Corporate) Bond (finance), Bonds ** Bond valuation ** ** * Stock, Equity valuation ** #Equity valuation above ** Fundamental analysis ** Stock valuation **

** ** ** Capital budgeting and ** ''The Theory of Investment Value'' *Real estate valuation **Real estate appraisal **Real estate economics

Considerations

*Bonds **Bond (finance)#Others, covenants and indentures **secured loan, secured / unsecured debt **senior debt, senior / subordinated debt **embedded options *Equity ** Minimum acceptable rate of return ** Margin of safety (financial) ** Enterprise value ** Sum-of-the-parts analysis ***Conglomerate discount ** Minority discount ** Control premium ** Accretion/dilution analysis ** Certainty equivalent ** Haircut (finance) ** Paper valuation

Discounted cash flow valuation

* Bond valuation **Modeling *** *** *** ***embedded options: ****Pull to par **** **Results ***Clean price ***Dirty price ***Yield to maturity ***Coupon yield ***Current yield ***Bond duration, Duration ***Bond convexity, Convexity ***embedded options: ****Option-adjusted spread ****effective duration ****effective convexity **Cash flows ***Principal (finance) ***Coupon (bond) ***Fixed rate bond ***Floating rate note ***Zero-coupon bond ***Accrual bond ***sinking fund provisions *Real estate valuation ** **Income approach ***Net Operating Income *** ***German income approach * Equity valuation **Results *** Net present value *** Adjusted present value *** Equivalent Annual Cost *** Payback period *** Discounted payback period ***

*** Modified Internal Rate of Return ***

*** Profitability index **Specific models and approaches *** Dividend discount model *** Gordon growth model *** Market value added / Economic value added *** Residual income valuation *** First Chicago Method *** rNPV *** Fed model *** Chepakovich valuation model *** Sum of perpetuities method *** Benjamin Graham formula *** LBO valuation model *** Goldman Sachs asset management factor model ** Cash flows *** Cash flow forecasting *** EBIDTA *** NOPAT *** Free cash flow **** Free cash flow to firm **** Free cash flow to equity *** Dividends ***

Relative valuation

*Bonds ** ** Yield spread *** I-spread *** Option-adjusted spread *** Z-spread *** Asset swap spread ** Credit spread (bond) ***Bond credit rating ***Altman Z-score ***Ohlson O-score ***Book value ***Debt-to-equity ratio ***Debt-to-capital ratio ***Current ratio ***Quick ratio ***Debt ratio *Real estate ** Capitalization rate ** Gross rent multiplier ** Sales comparison approach *** ** Cash on cash return *Equity **

** Market-based valuation ** Comparable company analysis **

*** Yield gap ** Return on equity *** DuPont analysis ** PE ratio ***PEG ratio ***Cyclically adjusted price-to-earnings ratio ***PVGO ** P/B ratio ** Valuation using multiples#Equity price based multiples, Price to cash based earnings ** Stock valuation#Price to Sales (P/S), Price to Sales ** EV/EBITDA ** Stock valuation#EV to Sales, EV/Sales ** Stock valuation#Market criteria (potential price), Stock image ** Valuation using the Market Penetration Model ** Graham number ** Tobin's q

Contingent claim valuation

*Valuation techniques **general ***Valuation of options *** ***#Derivatives pricing above **as typically employed ***Real options valuation#Valuation, Real options valuation *** *** *** ***Monte Carlo methods in finance *Applications **Corporate investments and Corporate finance#Investment and project valuation, projects ***Real options *** ***

*** ***structured finance investments (funding dependent) ***special purpose entities (funding dependent) **

assets and liabilities ***Warrant (finance), warrants and other convertible security, convertible securities ***securities with embedded options such as callable bonds ***employee stock options

Other approaches

*"Fundamentals"-based (relying on accounting information) **T-model **Residual income valuation **Clean surplus accounting **Valuation (finance)#Net asset value method, Net asset value method **Valuation (finance)#Net asset value method, Excess earnings method **Mergers and acquisitions#Business valuation, Historical earnings valuation **Mergers and acquisitions#Business valuation, Future maintainable earnings valuation **Graham number

Financial modeling

** Cash flow forecasting **

** Operating cash flow ** EBIDTA *** ** NOPAT ** Free cash flow *** Free cash flow to firm *** Free cash flow to equity ** Dividends ** Cash is king ** Mid-year adjustment ** Owner earnings * Required rate of return, Required return (i.e. discount rate) ** **

** Weighted average cost of capital **Cost of equity **Cost of debt **

*** ***

***Pure play#Pure play method, Pure play method ** Arbitrage pricing theory ** ***Total Beta **T-model ***T-model#The cash-flow T-model, cash-flow T-model * Terminal value (finance), Terminal value ** **Forecast period (finance) **long term growth rate *** *** *Forecasted financial statements **Financial forecast ** ** **Revenue ***Revenue model *** *** ***Net sales **Costs ***Profit margin ****Gross margin ****Net margin ****Cost of goods sold ***Operating expenses ****Operating ratio ***Cost driver ***Fixed cost ***Variable cost ***Overhead cost ***Value chain ***activity based costing ***Financial analysis#Method, common-size analysis ***Profit model **Capital ***

***Financial analysis#Method, common-size analysis ***Equity (finance) ****Equity (finance)#Shareholders' equity, Shareholders' equity ****Book value ****Retained earnings ***

****Long term asset / Fixed asset *****Fixed-asset turnover ****Long-term liabilities *****Debt-to-equity ratio *****Debt-to-capital ratio ***

****Current asset ****Current liability ****Inventory turnover / Days in inventory, Cost of goods sold ****Debtor days, Debtor & Creditor days ****Days sales outstanding / Days payable outstanding

Portfolio theory

General concepts

*Portfolio (finance) *Portfolio manager *Investment management **

** Passive management (Buy and hold) ***

**Core & Satellite **Smart beta **Expense ratio **Investment style *** Value investing *** Contrarian investing *** Growth investing **** CAN SLIM *** Index investing *** Magic formula investing *** Momentum investing *** Quality investing *** Style investing *** Factor investing **Investment strategy ***Benchmark-driven investment strategy ***Liability-driven investment strategy ** *Investor profile *Rate of return on a portfolio /

*Risk return ratio **Risk–return spectrum *Risk factor (finance) *Portfolio optimization *Diversification (finance) *Asset classes **Exter's Pyramid * Asset allocation **Tactical asset allocation ***Global tactical asset allocation **Asset allocation#Strategic asset allocation, Strategic asset allocation **Dynamic asset allocation *Sector rotation *Correlation & covariance **Covariance matrix **Covariance matrix#Correlation matrix, Correlation matrix * Risk-free interest rate *Leverage (finance) *Utility function *Intertemporal portfolio choice *Portfolio insurance **Constant proportion portfolio insurance * *Quantitative investment / Quantitative fund (see #Quantitative investing, below) *

Modern portfolio theory

*Portfolio optimization **Risk return ratio **Risk–return spectrum **Economic efficiency ***Efficient-market hypothesis ***Random walk hypothesis **Utility maximization problem **Markowitz model **Merton's portfolio problem **Kelly criterion **Roy's safety-first criterion *Theory and results (derivation of the CAPM) **Equilibrium price **Market price **Systematic risk ***Risk factor (finance) **Idiosyncratic risk / Specific risk **Mean-variance analysis (Two-moment decision model) **Efficient frontier (Mean variance efficiency) **Feasible region, Feasible set **

***Separation property (finance) **Tangent portfolio **Market portfolio **Beta (finance) ***Fama–MacBeth regression ***

*** **Capital allocation line **Capital market line **Security characteristic line **

***Single-index model **Security market line **Roll's critique *Related measures **Alpha (finance) **Sharpe ratio **Treynor ratio **Jensen's alpha *Optimization models **Markowitz model **Treynor–Black model *Asset pricing#General Equilibrium Asset Pricing, Equilibrium pricing models (CAPM and extensions) **

(CAPM) **Consumption-based capital asset pricing model (CCAPM) **Intertemporal CAPM (ICAPM) **Single-index model **Multiple factor models (see Risk factor (finance)) ***Fama–French three-factor model ***Carhart four-factor model *** Arbitrage pricing theory (APT)

Post-modern portfolio theory

*Approaches **Behavioral portfolio theory **Stochastic portfolio theory **Maslowian portfolio theory **Dedicated portfolio theory (fixed income specific) **Risk parity **Tail risk parity *Optimization considerations **Pareto efficiency **Bayesian efficiency **Multiple-criteria decision analysis **Multi-objective optimization **Stochastic dominance ***Stochastic dominance#Second-order, Second-order Stochastic dominance ***Marginal conditional stochastic dominance **Downside risk **Post-modern portfolio theory#Volatility skewness, Volatility skewness **Variance#Semivariance, Semivariance ** Expected shortfall (ES; also called conditional value at risk (CVaR), average value at risk (AVaR), expected tail loss (ETL)) **Tail value at risk **Statistical dispersion **Discounted maximum loss **Indifference price *Measures **Dual-beta ***Downside beta ***Upside beta **Upside potential ratio **Upside risk **Downside risk **Sortino ratio **Omega ratio **Bias ratio **Information ratio ***Active return ***Active risk **

*Optimization models **Black–Litterman model **Universal portfolio algorithm

Performance measurement

*Performance attribution **Market timing **Stock selection criterion, Stock selection *Fixed-income attribution *Performance attribution#Validity of benchmarks, Benchmark *Lipper average *Returns-based style analysis *Rate of return on a portfolio *Holding period return *Tracking error *Alpha (finance) *Beta (finance) *Simple Dietz method *Modified Dietz method *Modigliani risk-adjusted performance *Upside potential ratio *Maximum Downside Exposure (MDE), Maximum Downside Exposure *Maximum drawdown **Sterling ratio *Sharpe ratio *Treynor ratio *Jensen's alpha *Bias ratio *V2 ratio *Calmar ratio (hedge fund specific)

Mathematical techniques

* *Quadratic programming **Critical line method *Nonlinear programming *Mixed integer programming *Stochastic programming (Stochastic programming#Multistage portfolio optimization, § Multistage portfolio optimization) *Copula (probability theory) (Copula (probability theory)#Quantitative finance, § Quantitative finance) *Principal component analysis (Principal component analysis#Quantitative finance, § Quantitative finance) *Deterministic global optimization *Genetic algorithm () *Machine learning (Machine learning#Applications, § Applications) *Artificial neural network *

Quantitative investing

*Quantitative investing *Quantitative fund * and Quantitative analysis (finance)#Algorithmic trading quantitative analyst, § Algorithmic trading quantitative analyst *Trading: **Automated trading **High-frequency trading **Algorithmic trading **Program trading **Systematic trading *** **Trading strategy **Mirror trading **Copy trading **Social trading **VWAP **TWAP **Electronic trading platform **Statistical arbitrage *Portfolio optimization: ** ** **Black–Litterman model **Universal portfolio algorithm **Markowitz model **Treynor–Black model **Portfolio optimization#Improving portfolio optimization, other models **Factor investing ***low-volatility investing ***value investing ***momentum investing **Alpha generation platform **Kelly criterion **Roy's safety-first criterion *Risks: **Best execution **Implementation shortfall **Trading curb ** Market impact **Market depth **Slippage (finance) **Transaction costs *Discussion: ** ** ** ** **2010 flash crash ** ** *Leading companies: **Prediction Company **Renaissance Technologies **D. E. Shaw & Co **AQR Capital **Barclays Investment Bank **Cantab Capital Partners **Robeco **Jane Street Capital

Financial software tools

* Straight Through Processing Software * Technical Analysis Software (Finance), Technical Analysis Software * Fundamental Analysis Software * Algorithmic trading * Electronic trading platform * List of numerical-analysis software * Comparison of numerical-analysis software

Financial modeling applications

Corporate Finance

/ stock valuation - especially via Valuation using discounted cash flows, discounted cash flow, but including Valuation (finance)#Valuation overview, other valuation approaches *Scenario planning and Management accounting#Role within a corporation, management decision making ("what is"; "what if"; "what has to be done" §39 "Corporate Planning Models". See also, §294 "Simulation Model".) * Capital budgeting, including cost of capital (i.e. Weighted average cost of capital, WACC) calculations *Financial statement analysis / Financial ratio, ratio analysis (including of Operating lease, operating- and finance leases, and Research and development, R&D) *Revenue related: Revenue management#Forecasting, forecasting, Revenue#Financial statement analysis, analysis *Project finance modeling *Cash flow forecasting *Credit decisioning: Credit analysis, Consumer credit risk; Impairment (financial reporting), impairment- and Provision (accounting), provision-modeling *working capital management, Working capital- and treasury management; asset and liability management *Management accounting: Activity-based costing, Profitability analysis, Cost analyst, Cost analysis, Whole-life cost

Quantitative finance

*Valuation of options, Option pricing and calculation of Greeks (finance), their "Greeks" *Other derivative (finance), derivatives, especially interest rate derivatives, credit derivatives and exotic derivatives *Modeling the term structure of interest rates (Bootstrapping (finance), bootstrapping / multi-curve framework, multi-curves, short-rate models, Heath–Jarrow–Morton framework, HJM framework) and credit spread (bond), credit spreads *Credit valuation adjustment, CVA, as well as the various XVA *Credit risk, counterparty credit risk, and regulatory capital: exposure at default, EAD, probability of default, PD, loss given default, LGD, potential future exposure, PFE *Structured product#Product design and manufacture, Structured product design and manufacture *Portfolio optimizationSee for example: ; and Quantitative investing more generally; see further re Portfolio optimization#Optimization methods, optimization methods employed. *Financial risk modeling: value at risk (Value at risk#Computation methods, parametric- and / or Historical simulation (finance), historical, conditional value at risk, CVaR, extreme value theory, EVT), stress test (financial), stress testing, PnL Explained#Sensitivities method, "sensitivities" analysis

Financial institutions

Financial institutions * Bank ** List of banks *** List of banks in the Arab World *** List of banks in Africa *** List of banks in the Americas *** List of banks in Asia *** List of banks in Europe *** List of banks in Oceania *** List of international banking institutions ** Advising bank **

*** List of central banks ** Commercial bank ** Community development bank ** Cooperative bank ** Custodian bank ** Depository bank ** Ethical bank ** Investment bank ** Islamic banking ** Merchant bank **

** Mutual savings bank ** National bank ** Offshore bank ** Private bank ** Savings bank ** Swiss bank ** Bank holding company * Building society * Broker ** Broker-dealer ** Brokerage firm ** Commodity broker ** Insurance broker ** Prime brokerage ** Retail broker ** Stockbroker * Clearing house (finance), Clearing house * Commercial Loan, Commercial lender * Community development financial institution * Credit rating agency * Credit union * Diversified financial * Edge Act Corporation * Export Credit Agencies * Financial adviser * Financial intermediary * Financial planner * Futures exchange ** List of futures exchanges * Government sponsored enterprise * Hard money lender * Independent financial adviser * Industrial loan company * Insurance company * Investment adviser * Investment company * Investment trust * Large and Complex Financial Institutions *

* Non-banking financial company * Savings and loan association * Stock exchange ** List of stock exchanges * Trust company

Education

*For the typical finance career path and corresponding education requirements see: **Financial analyst generally, and esp. Financial analyst#Qualification, § Qualification, discussing various investment, banking, and corporate roles (i.e. financial management, corporate finance, investment banking, securities analysis & valuation, portfolio & investment management, credit analysis, working capital & treasury management; see ) **Quantitative analyst, and , specifically re roles in quantitative finance (i.e. derivative pricing & hedging, interest rate modeling, financial risk management, financial engineering, computational finance; also, the mathematically intensive variant on the banking roles; see ) *Business education lists undergraduate degrees in business, commerce, accounting and economics; "finance" may be taken as a academic major, major in most of these, whereas "quantitative finance" is almost invariably postgraduate, following a Mathematics education#Content and age levels, math-focused Bachelors; the most common degrees for (entry level) investment, banking, and corporate roles are: **Bachelor of Business Administration (BBA) **Bachelor of Commerce (BCom) **Bachelor of Accountancy (B.Acc) **Bachelor of Economics (B.Econ) **The tagged degree, tagged Bachelor of Science, BS / Bachelor of Arts, BA "in Finance" - the undergraduate version of the MSF below - or less common, Investment management#Education or certification, "in Investment Management" or "in Personal Finance" *At Business education#Postgraduate education, the postgraduate level, the MBA, master of commerce, MCom and Master of Science in Management, MSM (and recently the Master of Applied Economics) similarly offer training in finance generally; at this level there are also the following specifically focused master's degrees, with MSF the broadest - see for their focus and inter-relation: **Master of Applied Finance (M.App.Fin) **Master of Computational Finance **Master's in Corporate Finance **Master of Finance (M.Fin, MIF) ** Master's in Financial Analysis **Master of Financial Economics **Master of Financial Engineering (MFE) **Master of Financial Planning **Master's in Financial Management **Master of Financial Mathematics **Master of Quantitative Finance, Master's in Financial Risk Management **Master's in Investment Management **Master of Mathematical Finance **Master of Quantitative Finance (MQF) **Master of Science in Finance (MSF, MSc Finance) **Master of Science in Global Finance *Business education#Doctoral, Doctoral-training in finance is usually a requirement for academia, but not relevant to industry **quants often ''enter'' the profession with Doctor of Philosophy, PhDs in disciplines such as physics, mathematics, engineering, and computer science, and learn finance "on the job” **as List of fields of doctoral studies in the United States#Business management/administration, an academic field, finance theory is studied and developed within the disciplines of management, (financial economics, financial) economics, accountancy, and applied mathematics, applied / financial mathematics. *For specialized roles, there are various Professional certification in financial services, Professional Certifications in financial services (see #Designations and accreditation above); th
best recognized
are arguably: **Association of Corporate Treasurers (MCT / FCT) **Certificate in Quantitative Finance (CQF) **Certified Financial Planner (CFP) **Certified International Investment Analyst (CIIA) **Certified Treasury Professional (CTP) **Chartered Alternative Investment Analyst (CAIA) **Chartered Financial Analyst (CFA) **Professional_certification_in_financial_services#Chartered_Wealth_Manager, Chartered Wealth Manager (CWM) **CISI Diploma, CISI Diploma in Capital Markets (MCSI) **Financial Risk Manager (FRM) **Professional Risk Manager (PRM) *Various organizations offer executive education, Continuing professional development, CPD, or other focused training programs, including: **Amsterdam Institute of Finance **Canadian Securities Institute **Chartered Institute for Securities & Investment **Global Association of Risk Professionals, GARP **ICMA Centre **The London Institute of Banking & Finance **New York Institute of Finance **PRMIA **South African Institute of Financial Markets **Swiss Finance Institute *See also qualifications in related fields: ** **Actuarial credentialing and exams **Business education ** **Economics education **

Related lists

* Index of accounting articles * Outline of business management * Outline of marketing * Outline of economics * Outline of production * List of international trade topics * List of business law topics * List of business theorists * Actuarial topics

References

External links

Wharton Finance Knowledge Project
– finance knowledge for students, teachers, and self-learners.
Prof. Aswath Damodaran
- financial theory, with a focus in Corporate Finance, Valuation and Investments. Updated Data, Excel Spreadsheets.

(Prof. John M. Wachowicz) -Links to finance web sites, grouped by topic
studyfinance.com
- introductory finance web site at the University of Arizona
SECLaw.com
- law of the financial markets

- stock market related definitions {{DEFAULTSORT:Finance Outlines of economics, Finance Wikipedia outlines, Finance Finance lists, Business terms, Finance topics