Flow Of Funds - FOF

AAA

DEFINITION of 'Flow Of Funds - FOF'

A set of accounts that is used to follow the flow of money within various sectors of an economy. Specifically, the account analyzes economic data on borrowing, lending and investment throughout sectors like households, businesses and farms.

INVESTOPEDIA EXPLAINS 'Flow Of Funds - FOF'

The accounts are tracked and analyzed by a country's central bank. In the United States, this is done by the Federal Reserve Bank, and the findings are provided approximately 10 weeks after the end of a quarter.

The FOF accounts are used primarily as an economy-wide performance indicator. The data from the FOF accounts can be compared to prior data to analyze the financial strength of the economy at a certain time and to see where the economy may go in the future. The accounts can also be used by governments to formulate monetary and fiscal policy.

RELATED TERMS
  1. Fiscal Policy

    Government spending policies that influence macroeconomic conditions. ...
  2. Federal Reserve Bank

    The central bank of the United States and the most powerful financial ...
  3. Sector

    1. An area of the economy in which businesses share the same ...
  4. Macroeconomics

    The field of economics that studies the behavior of the aggregate ...
  5. Monetary Policy

    The actions of a central bank, currency board or other regulatory ...
  6. Federal Reserve Board - FRB

    The governing body of the Federal Reserve System. The seven members ...
RELATED FAQS
  1. What is the difference between cash flow and fund flow?

    In financial accounting, "cash flow" refers to the statement of cash flows, a required report under generally accepted accounting ... Read Full Answer >>
  2. What are the different types of margin calls?

    Margin is much like buying stocks on loan. An investor borrows funds from a brokerage firm to purchase stocks and pays interest ... Read Full Answer >>
  3. What are some examples of operations management in healthcare?

    Open market operations are a mechanism by which monetary policy is transmitted. Monetary policy aims to find the best balance ... Read Full Answer >>
  4. What economic indicators are important to consider when investing in the banking ...

    The banking sector is a hinge for nearly all economic activity. For that reason, there's hardly an economic indicator that ... Read Full Answer >>
  5. What factors are the primary drivers of banks' share prices?

    In a broad sense, bank share prices are driven by the same forces as any other shares. Major, abstract factors include overall ... Read Full Answer >>
  6. How does the equity risk premium correlate with the Federal Reserve's prime rate?

    The equity risk premium correlates negatively with the Federal Reserve's prime rate. When the prime rate is declining, the ... Read Full Answer >>
Related Articles
  1. Economics

    The Federal Reserve

    Few organizations can move the market like the Federal Reserve. As an investor, it's important to understand exactly what the Fed does and how it influences the economy.
  2. Personal Finance

    How The U.S. Government Formulates Monetary Policy

    Learn about the tools the Fed uses to influence interest rates and general economic conditions.
  3. Options & Futures

    Explaining The World Through Macroeconomic Analysis

    From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone.
  4. Retirement

    Economic Indicators To Know

    The economy has a large impact on the market. Learn how to interpret the most important reports.
  5. Investing

    What A Rate Hike May Mean For Stocks

    By the end of the year, investors will likely be contending with the first Federal Reserve (Fed) rate hike in nearly a decade.
  6. Professionals

    Why You Should Avoid Fixating on Bond Duration

    Financial advisors and their clients should then focus on a bond fund’s portfolio rather than relying on any single metric like duration.
  7. Credit & Loans

    How The Federal Reserve Affects Mortgage Rates

    The Federal Reserve's actions as it aims to maintain economic stability impact the cost of funds for banks and consequently for mortgage borrowers.
  8. Economics

    Will The US Economy Rebound In The 2nd Quarter?

    Most investors know that U.S. 1st quarter growth numbers aren’t pretty. Economic statistics have been missing expectations by the largest margin since 2009
  9. Economics

    The U.S. Economy May Be Stronger Than You Think

    While the economic performance in the U.S. broadly disappointed in the first quarter, temporary factors presented one-off events that depressed output.
  10. Investing

    Pockets Of Value In The Stock Market

    U.S. stocks benefited from signs the Fed’s path toward higher interest rates, as well as from continued merger-and-acquisition activity on of low rates.

You May Also Like

Hot Definitions
  1. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
  2. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  5. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  6. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
Trading Center