Investopedia's Dictionary includes more than 12,000 unique terms (and growing!), but year after year there are some tried-and-true favorites among our readers. Price/earnings ratio commonly tops the list, along with other basic terms such as return on equity and return on investment. However, when a new term breaks into our fairly consistent list of top terms, there's usually a good reason for it. Find out what some of our readers sought information on this year – and why.

IN PICTURES: 5 Lessons From The Recession

Death Cross
One term that jumped unexpectedly into our most searched list was the term death cross. And this term doesn't just sound ominous – it is, which is what ranked it as one of the most popular terms in July. A death cross occurs when a security's short-term moving average breaks below its long-term moving average, which can mean that a bear market is on the horizon. (Learn more about moving averages in How are moving averages used in trading?)

At the end of June, the Dow Jones Industrial Average crossed this threshold when its 50-day moving average dropped below its 200-day moving average. In early July, the S&P 500 followed suit, leaving traders scrambling to decide whether this was indeed the kiss of death for what had appeared to be a recovering market. But while the indexes did plunge over the summer, they slowly regained momentum and made up those losses as the year progressed – and then some.

Double-Dip Recession
Another major term that intrigued Investopedia readers in 2010 was double-dip recession, which took a spin in our top terms list in July and August. A double-dip recession refers to a recession that is followed by a short-lived recovery before dropping into recession again. (For background reading, see Recession: What Does It Mean To Investors?)

Throughout 2010, the financial news was buzzing about the possibility of a second dip into recession. Over the summer, the fear of another dip hit fever pitch, as analysts began warning that the economic recovery couldn't last. Although the White House recently warned that a failure to pass the U.S. government's proposed tax deal could lead to a second dip, that was more a political statement that one about the economy. For now, fears of another slide into recession (or a deeper recession) seem to have abated.

Hedge Funds and CDOs, Oh My!
Although the term hedge fund is fairly popular on Investopedia, this term saw a real surge in April. This may have occurred as a result of the fraud charges that hit Goldman Sachs in that month, which were centered around a major hedge fund that worked with Goldman to create collateralized debt obligations (also a major term in April and May) which would essentially benefit the fund (and cost Goldman's investors) if their value fell. The lawsuit alleged that Goldman Sachs failed to divulge "vital information" about the conflict of interest to investors. The SEC case against Goldman was only one of the latest blows against hedge funds and the lack of regulation (and transparency) surrounding the investments they make, including scandals at several small hedge funds. In July, Goldman Sachs agreed to pay $550 million and change its business practices to settle the SEC's claims. (For more information on how the company got into trouble, see Goldman Sachs: By The Numbers.)

Basis Point
The term basis point was also popular with our readers over the summer months. This spike may have occurred as a result of the U.S. government's negotiations with China's central bank to de-peg the yuan from the U.S. dollar. A basis point is a unit (1/100th of a percent) that can be used to denote an interest rate change, and can be used to compare the change of one currency against another. The argument against the yuan/dollar relationship was that it benefited China while hurting the U.S. This is because it served to make Chinese goods artificially cheap, making it difficult for American manufacturers to compete. Unfortunately for China, depreciating its currency could mean less foreign investment, lower wages and fewer exports, which could also negatively impact the U.S. by reducing access to the cheap goods the country has become so accustomed to. In 2010, U.S. President Barack Obama put major pressure on China to devalue the yuan, leading the term "basis point" to pop up all over the news. (For insight on this story, see Why China's Currency Tangos With The USD and Do Cheap Imported Goods Cost Americans Jobs?)

IN PICTURES: Break Into Forex In 12 Steps

The Bottom Line
The past year's financial development prompted a few relatively obscure terms to get some time in the limelight. Only time will tell which financial terms become a part of the general lexicon in 2011, but in the meantime, if you have suggestions for new terms you would like to see on Investopedia.com, please drop us a line!

For the latest financial news, see Water Cooler Finance: Canadian Takeover And U.S. Tax Breaks.

Related Articles
  1. Investing

    How To Calculate Minority Interest

    Minority interest calculations require the use of minority shareholders’ percentage ownership of a subsidiary, after controlling interest is acquired.
  2. Economics

    A Look at Greece’s Messy Fiscal Policy

    Investigate the muddy fiscal policy, tax problems, and inability to institute austerity that created the Greek crises in 2010 and 2015.
  3. Professionals

    Are Hedge Fund ETFs Suitable for Your Portfolio?

    Are hedge fund ETFs right for you? Here's what investors need to consider.
  4. Economics

    How Do Asset Bubbles Cause Recessions?

    Understand how asset bubbles often lead to deep, protracted recessions. Read about historical examples of recessions preceded by asset bubbles.
  5. Investing Basics

    How AQR Places Bets Against Beta

    Learn how the bet against beta strategy is used by a large hedge fund to profit from a pricing anomaly in the stock market caused by high stock prices.
  6. Investing News

    What Shook the U.S. Stock Market Today?

    What was looking as a decent year for US Stock market has suddenly gone off track as the Dow Jones Industrial Average plunged 531 points in the week ending August 23, 2015.
  7. Economics

    Explaining Replacement Cost

    The replacement cost is the cost you’d have to pay to replace an asset with a similar asset at the present time and value.
  8. Economics

    How Does National Income Accounting Work?

    National income accounting is an economic term describing the system used by a country to gather data and determine aggregate economic activity.
  9. Investing Basics

    Explaining the High-Water Mark

    A high-water mark ensures fund managers are not paid performance fees when they perform poorly.
  10. Fundamental Analysis

    Calculating Free-Float Methodology

    Free-float methodology is used to calculate the total market capitalization of an index’s underlying companies.
RELATED TERMS
  1. Derivative

    A security with a price that is dependent upon or derived from ...
  2. Real Estate Investment Trust - ...

    A REIT is a type of security that invests in real estate through ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis ...
  4. Surplus

    The amount of an asset or resource that exceeds the portion that ...
  5. Cash Flow

    The net amount of cash and cash-equivalents moving into and out ...
  6. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors ...
RELATED FAQS
  1. Where do penny stocks trade?

    Generally, penny stocks are traded through the use of the Over the Counter Bulletin Board (OTCBB) and through pink sheets. ... Read Full Answer >>
  2. Where can I buy penny stocks?

    Some penny stocks, those using the definition of trading for less than $5 per share, are traded on regular exchanges such ... Read Full Answer >>
  3. What are some examples of general and administrative expenses?

    In accounting, general and administrative expenses represent the necessary costs to maintain a company's daily operations ... Read Full Answer >>
  4. How do dividend distributions affect additional paid in capital?

    Whether a dividend distribution has any effect on additional paid-in capital depends solely on what type of dividend is issued: ... Read Full Answer >>
  5. Why can additional paid in capital never have a negative balance?

    The additional paid-in capital figure on a company's balance sheet can never be negative because companies do not pay investors ... Read Full Answer >>
  6. When does the fixed charge coverage ratio suggest that a company should stop borrowing ...

    Since the fixed charge coverage ratio indicates the number of times a company is capable of making its fixed charge payments ... Read Full Answer >>

You May Also Like

Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!