Month: September 2020

A voluntary trust is a type of living trust that is created during the lifetime of the trustor and is also known as an inter vivos trust. In a voluntary trust, the trustor retains the legal title of the gift transferred to the beneficiary, even though the beneficiary has actual title and possession and ability to carry out actions of the trust. A voluntary trust is also defined as an obligation arising out of a personal confidence reposed in, and voluntarily accepted by, one individual for the benefit of another. This is in contrast to an involuntary trust, which is created by law. read more

Open interest is the total number of outstanding derivative contracts, such as options or futures that have not been settled for an asset. The total open interest does not count, and total every buy and sell contract. Instead, open interest provides a more accurate picture of the options trading activity, and whether money flows into the futures and options market are increasing or decreasing.

Annuity due is an annuity whose payment is due immediately at the beginning of each period. A common example of an annuity due payment is rent, as landlords often require payment upon the start of a new month as opposed to collecting it after the renter has enjoyed the benefits of the apartment for an entire month.

Money illusion is an economic theory stating that people have a tendency to view their wealth and income in nominal dollar terms, rather than in real terms. In other words, it is assumed that people do not take into account the level of inflation in an economy, wrongly believing that a dollar is worth the same as it was the prior year.

In legal and financial terminology, a covenant is a promise in an indenture, or any other formal debt agreement, that certain activities will or will not be carried out or that certain thresholds will be met. Covenants in finance most often relate to terms in a financial contract, such as a loan document or bond issue stating the limits at which the borrower can further lend.

Similar in concept to gross income, gross dividends are the sum total of all dividends received by an investor for tax purposes. Gross dividends include all ordinary dividends that are paid, plus capital-gains distributions and nontaxable distributions received by the taxpayer during the year before taxes, fees, and expenses are deducted.

Gentrification is defined as the transformation of a city neighborhood from low value to high value. Gentrification is also viewed as a process of urban development in which a neighborhood or portion of a city develops rapidly during a short period. This process is often marked by inflated home prices and displacement of the neighborhood’s previous residents.

A stock split is a corporate action in which a company divides its existing shares into multiple shares to boost the liquidity of the shares. Although the number of shares outstanding increases by a specific multiple, the total dollar value of the shares remains the same compared to pre-split amounts, because the split does not add any real value. The most common split ratios are 2-for-1 or 3-for-1, which means that the stockholder will have two or three shares, respectively, for every share held earlier. read more

An investment advisor (also known as a stock broker) is any person or group that makes investment recommendations or conducts securities analysis in return for a fee, whether through direct management of clients’ assets or by way of written publications. The precise definition of the term was established through the Investment Advisers Act of 1940.

A hypermarket is a retail store that combines a department store and a grocery supermarket. Often a very large establishment, hypermarkets offer a wide variety of products such as appliances, clothing, and groceries.