Voc 2 Flashcards
(22 cards)
Debt:
refers to money that is borrowed and must be repaid, typically with interest. It can be incurred by individuals, companies, or governments and is often used to finance various expenses or investments
Deflation:
when prices go down over time, meaning money can buy more than before. While it sounds good, it can hurt the economy by causing people to spend less and making debts harder to pay off.
Depreciate:
refers to the decrease in the value of an asset over time, typically due to wear and tear, age, or changes in market conditions.
Diversification:
investment strategy that involves spreading investments across various assets or asset classes to reduce risk. By investing in a variety of things you can protect yourself from losing a lot of money if one investment doesn’t do well.
Dividend:
money that a company pays to its shareholders from its profits. It’s a way for companies to share their success with investors.
Dividend per share (DPS):
financial metric that indicates how much a company pays in dividends for each share of its stock.
Dull market:
refers to a financial market characterized by low trading volume, minimal price movement, and lack of investor interest or activity.
Earnings per share (EPS):
financial metric that shows how much money a company makes for each share of its stock. It helps investors see how profitable a company is and allows them to compare it with other companies in the same industry.
Entreprise value/firm value
way to measure how much a company is really worth, taking into account not just its stock price but also its debts and cash.
Equity (=stock):
represents ownership in a company. When you own equity in a company you essentially own a portion of that company.
Exchange rate:
how much one currency is worth compared to another. It’s important for buying things from other countries, traveling, and understanding international business. For example, it tells you how many euros you can get for your dollars when you travel to Europe.
Financial analyst:
professional who evaluates financial data, trends, and investment opportunities to help businesses and individuals make informed financial decisions. Their role often involves analyzing financial statements, market trends, etc.
Financial circles:
groups of people who work in finance, like bankers and investors. They share information and ideas, helping each other make better financial decisions.
Financial markets:
Places, physical or virtual, where financial assets are bought and sold.
Foreign currency:
refers to money that is used in a country other than your own.
Forward (contract):
agreement to buy or sell something at a set price on a future date. It helps people and businesses protect themselves from changing prices. For example a farmer can lock in a price for their crops to avoid losses if prices drop later.
Foreign-exchange broker:
a foreign-exchange broker helps people trade different currencies. They make money from the difference in prices (the spread) when you buy or sell currency.
Future contract:
agreement to buy or sell something, like oil or coffee, at a set price on a future date. These contracts are traded on exchanges, making it easier to buy and sell them. They are often used by businesses to protect themselves from price changes or by traders looking to profit from future price movements.
Gamble on the stock exchange:
it means taking big risks, hoping to make quick money by guessing which way stock prices will move. Unlike investing, it’s less about careful planning and more about trying your luck, which can lead to large profits or big losses.
Guaranteed investment certificates (GIC):
low-risk investment offered by banks and financial institutions, where you deposit a sum of money for a fixed period and receive a guaranteed return. The interest rate is agreed upon when you purchase the GIC, and you are guaranteed to get back the original amount you invested (the principal) plus interest when the term ends.
Hedge:
hedging means to take actions that reduce or protect against potential losses from other investments. Hedging involves using strategies to minimize risk typically by making an additional investment or entering into a contract that offsets the potential downside of another position.
Hedge fund:
investment fund that uses advanced techniques to try to make big profits. It’s riskier than regular investments and often only available to rich people or large organizations. Hedge fund managers use strategies that can make money even if the market is going down but the potential for loss is also greater.
