Posts tagged as:

investment

Index Reset Period

August 3, 2009

Index Reset Period – The period that a cap or participation rate applies to an Indexed investment.  Generally an annual or monthly period and described as an Annual point-to-point or Monthly point-to-point.  They can also be Annual or Monthly Averages.

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Cap Rate

August 3, 2009

Cap Rate – Normally relating to Indexed investments, it is the maximum percentage of growth in a particular stock or Index that the owner of the investment can benefit from.  An example of this would be an investment with a 8% cap rate on the S&P 500 Index.  If the Index were to grow by [...]

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Participation Rate

August 3, 2009

Participation Rate – Normally relating to Indexed investments, it is the percentage of growth in a particular stock or Index that the owner of the investment gets to benefit from.  An example of this would be an investment with a 50% participation rate on the S&P 500 Index.  If the Index were to grow by [...]

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Investment Load

August 3, 2009

Investment Load – A load is a fee paid to purchase or sell a specific investment. It is expressed as a percentage of the amount invested and is most often used when discussing mutual funds or variable annuities.

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Call Option

August 3, 2009

Call Option – The buyer of a call option wants the price of the underlying instrument to rise in the future; the seller either expects that it will not, or is willing to give up some of the upside (profit) from a price rise in return for the premium (paid immediately) and retaining the opportunity [...]

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Option

August 3, 2009

Option – Options a commonly used in real estate and investing and there are two typical types of options – a call option and a put option.  An option is the choice or opportunity to purchase a specified quantity of an investment at a later date for a pre-determined price.  The buyer pays a fee [...]

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Put Option

August 3, 2009

Put Option – The buyer of a put option either believes it is likely the price of the underlying asset will fall by the exercise date, or hopes to protect a long position in the asset. The advantage of buying a put is that the risk is limited to the fee (premium) paid by the [...]

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Stock Index

July 31, 2009

Index – Also called a Stock Index, it is a grouping of stocks or a segment of the financial market place.  Each index — and there are a large number of them — measures the market or portion of the economy it tracks from a specific starting point and reports changes up or down, usually [...]

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Indexed Interest Rate

July 29, 2009

Indexed Rate – This term refers to investment where the interest credited is based on the performance of an Index like the S&P 500, Dow Jones, or NASDAQ.  The investment itself is not directly invested in the “market” and therefore not subject to market loss.  A common use of this principal is an index or [...]

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Principal

July 29, 2009

Principal – The original or total amount of after-tax deposits an investor makes into an investment, not including interest earned.  This is sometimes referred to as the cost basis.

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