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Editor Picks

  1. Rule Of Thumb

    A guideline that provides simplified advice regarding ...
  2. Cox-Ingersoll-Ross Model - CIR

    A mathematical formula used to model interest rate ...
  3. Risk Parity

    A portfolio allocation strategy based on targeting ...
  4. Homogeneous Expectations

    An assumption in Markowitz Portfolio Theory that all ...
  5. Frame Dependence

    The human tendency to view a scenario differently depending ...
  6. Trillion Dollar Coin

    A trillion dollar coin is a theoretical coin that could ...

Recently Added

  1. Guerrilla Trading

    A very short-term trading technique that aims to generate small profits while taking on very little risk per trade, and repeating this multiple times in a trading session. Guerrilla trades typically ...
  2. Golden Leash

    Special incentives offered to directors being nominated to serve on the board of a company by a major shareholder. A golden leash is designed to offer an incentive to the nominee directors to ...
  3. Sequestration

    A term adopted by Congress to describe a fiscal policy process that automatically reduces the federal budget across most departments and agencies. Sequestration, or "the sequester," ...
  4. Demographic Dividend

    The freeing up of resources for a country's economic development and the future prosperity of its populace as it switches from an agrarian to an industrial economy. In the initial stages of this ...
  5. Hot Hand

    The notion that because one has had a string of successes, he or she is more likely to have continued success. For example, if one flipped a (fair) coin and guessed correctly that it would land ...
  6. House Money Effect

    The tendency for investors to take more and greater risks when investing with profits. The house money effect gets its name from the casino phrase "playing with the house's money." The house ...
  7. Environmental Tariff

    A tax placed on products being imported to or exported from countries with unsatisfactory environmental pollution controls. An environmental tariff is, in effect, a sin tax, designed to make ...
  8. Corporate Undertaker

    An informal term for liquidator. As the name implies, a corporate undertaker oversees the liquidation of an insolvent company. In other, more descriptive words, he or she is the figurative funeral ...
  9. Blue-Chip Index

    A stock index that tracks the shares of the top-performing publicly traded companies. Blue-chip stocks represent companies that are financially stable, well established and provide good returns ...
  10. Sticky Wage Theory

    An economic hypothesis that the pay of employed workers tends to respond slowly to the changes in a company's or the broader economy's performance. When unemployment rises, the wages of those ...
  11. Trading Rut

    A period of investing during which a trader fails to earn profits and instead experiences a string of losses. In the long run, it is common for investors to fall into occasional trading ruts. ...
  12. Portfolio Investment

    The provision of capital to a company in exchange for the possibility of earning a return on that capital if the company is profitable. Someone who makes a portfolio investment does not acquire ...
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Hot Definitions
  1. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.
  2. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.
  3. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.
  4. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.
  5. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.
  6. Icarus Factor

    The term Icarus factor describes a situation where managers or executives initiate an overly ambitious project which then fails. Fueled by excitement for the project, the executives are unable to reign in their misguided enthusiasm before it is too late to avoid the failure.
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