An index fund is a mutual fund, or compilation of instruments (such as stocks, bonds, housing, art, commodities), that mimic the composition of an index. For example, if the index fund replicates the S&P 500 index, all 500 stocks (in the appropriate percentages) would be in that fund. Because it’s a mutual fund, the monetary value of an index fund is determined at the end of each trading day (as opposed to the price of a stock, which fluctuates throughout the day).
Archive for the ‘Daily Definition’ Category
An Index Fund is…
Thursday, June 11th, 2009Private Equity is…
Thursday, June 11th, 2009A Fund is…
Thursday, June 11th, 2009A fund is an organization or legal structure set up to manage and control a certain amount of money. Each fund has a specific investment objective. For example, an equity mutual fund invests in stocks, a private equity fund invests in non-public companies, and a bond fund invests in fixed income instruments.
Equity is…
Wednesday, June 10th, 2009Equity is Wall Street talk for “stock.” It can also refer to the value of things or properties you own outright. For example, you own equity in your new bike, your recently purchased car, or your developing intellect when you go to school.
Alternatives are…
Wednesday, June 10th, 2009Alternatives are investments other than traditional stocks and bonds, like real estate, start-up companies, and blended funds.
Philanthropy is…
Wednesday, June 10th, 2009Philanthropy is the act of donating money, time, services, effort, and/or goods to a cause in order to promote the well-being of others while expecting nothing in return.
Forex (FX) is…
Wednesday, June 10th, 2009Forex is an international currency market (sometimes called a “foreign exchange market”) where you can buy and sell currencies such as U.S. Dollars, Great British Pounds, Japanese Yen, etc.
A Recession is…
Wednesday, June 10th, 2009A recession is when the Gross Domestic Product of a nation declines for two or more quarters. It is when the total value of goods and services of a country stop growing for six months or more.
A Dividend is…
Wednesday, June 10th, 2009A dividend is something “extra” that you get for being an investor or shareholder. Dividends are usually paid quarterly and in cash, but can also be paid in stock or other properties.
An Asset is…
Wednesday, June 10th, 2009An asset is any item of economic value owned by either an individual or a corporation. For example, an asset could be money in your wallet, a car, kitchen equipment in a restaurant, or a patent on a really cool new hover board.