Personal Finance
The three-digit number lenders use to judge your creditworthiness.
Credit Score
Owning a share of a company makes you this.
Shareholder
The fee charged by a real estate agent for helping buy or sell property is commonly called this.
Commission
A period when stock prices are consistently rising.
Bull Market
The recommended percentage of gross income to save for retirement.
15%
The concept of spreading investments across assets to reduce risk.
Diversification
loan type where interest payments can change periodically based on market indices.
ARM (Adjustable Rate Mortgage)
The difference between what banks earn on loans and pay on deposits.
Net Interest Margin
The average student loan debt in the U.S. is closest to
40-50k
The risk that cannot be eliminated through diversification.
Market (Systematic) Risk
Owning a portion of a large real estate portfolio through shares in a trust that invests in income-producing properties is called this type of investment.
REIT (Real Estate Investment Trust)
The term for loans or credit extended to borrowers with a higher risk of default, often carrying higher interest rates.
Subprime lending
The method of paying off high-interest debt first to minimize long-term costs.
avalanche method
A measure of risk-adjusted return that divides excess return by standard deviation.
Sharpe Ratio
Using borrowed capital to acquire real estate can amplify both returns and losses. Investors must carefully consider this ratio relative to cash flow.
Debt-to-equity ratio
This 2010 law tightened financial regulations after the 2008 crisis.
Dodd-Frank Act
This type of retirement account requires after-tax contributions, but allows tax-free withdrawals in retirement, making it especially valuable if you expect to be in a higher tax bracket later.
Roth IRA
When investors panic and sell stocks irrationally, causing prices to drop below intrinsic value, it can create opportunities for this type of investor.
contrarian investor
This New Deal official played a key role in creating the Federal Housing Administration (FHA), helping to stabilize the U.S. housing market during the Great Depression and laying the groundwork for modern suburban development.
Harry Hopkins
The interbank rate historically used as a global lending benchmark, now largely replaced by SOFR
LIBOR (London Interbank Offered Rate)