Capital Account

AAA

DEFINITION of 'Capital Account'

A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public and private international investments flowing in and out of a country.

May also refer to an account showing the net worth of a business at a specific point in time.

INVESTOPEDIA EXPLAINS 'Capital Account'

The capital account includes foreign direct investment (FDI), portfolio and other investments, plus changes in the reserve account. The capital account and the current account together constitute a nation's balance of payments.

Since large capital inflows or outflows can have destabilizing effects on a nation's economy, many countries have controls in place to regulate capital account flows.

RELATED TERMS
  1. Balance Of Payments (BOP)

    A record of all transactions made between one particular country ...
  2. Current Account

    The difference between a nation’s savings and its investment. ...
  3. Capital Asset

    A type of asset that is not easily sold in the regular course ...
  4. Foreign Direct Investment - FDI

    An investment made by a company or entity based in one country, ...
  5. Net Lending

    The amount of extra funds that a sector has available to provide ...
  6. Capital Gains Tax

    A type of tax levied on capital gains incurred by individuals ...
Related Articles
  1. Exploring The Current Account In The ...
    Economics

    Exploring The Current Account In The ...

  2. What Is The Balance Of Payments?
    Economics

    What Is The Balance Of Payments?

  3. Understanding Capital And Financial ...
    Bonds & Fixed Income

    Understanding Capital And Financial ...

  4. Treasury International Capital
    Credit & Loans

    Treasury International Capital

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  5. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center