Definitions

DEFINING FINANCIAL TERMS

Finance- is the study of how people and business evaluate investments and raise capital to fund them. Its primary function is the management of money. The role is to help management deal with financial issues.

Secondary Market- where all subsequent trading of previously issued securities take place. In secondary markets the issuing firm does not receive any new financing. Its role is to allow investors to resale or exchange the stock.

Stocks- debt or funds due from the government for money loaned at interest. Its role is for investors to trade, sell, or invest.

Debt- is what the company or organization owes. Its role is to help companies borrow money they can pay back.

Return on Investment- used to evaluate the efficiency of an investment.

Efficient Market- is the name of the stock market where stocks are freely available to all the market used in buying and selling plans. Its role is to present quick information with precise prices.

Risk- is what you have when there is a possibility of a loss. Its role to involve in making decisions in finance.

Bond- a debt that has a maturity time of time longer than 10 years, long term debt issued by a government body. It allows the business owners to issue them and sale them for money the company can use for financial needs.

Yield- the income return of an investment. Its role to express a percentage of cost of the environment.

Primary Market- is the market which new securities are bought and sold for the first time. Its role is to create new markets for investors.

Securities- is a negotiable investment that represent a financial claim. Its role can be used to secure or receive a loan.

Capital- the financial of the assets. Its role is to measure a company’s value.

Rate of Return- a period that your gain or loss on an investment. Its role is investor to measure how his money is doing.

Cash Flow- is the amount of cash that can be taken out of the business over the same...