Qualified Domestic Institutional Investor (QDII)
Definition The Qualified Domestic Institutional Investor (QDII) program, also known as the Qualified Domestic Institutional Investor (QDII) program, is a capital market plan that allows financial institutions to participate in offshore markets such as equities and bonds. Comparable to QFII, it is a transitional arrangement that provides limited opportunities for domestic investors to access foreign markets when a country's currency...
Certificate of Deposit
DefinitionA certificate of deposit is a time deposit, a financial product commonly sold in the United States and elsewhere by banks, thrift institutions, and credit unions. Certificate of Deposit Certificate of Deposit, CD, is considered one of the most commonly used low-income low-risk investment options. CDs are offered by commercial banks or credit unions as certificate that will entitle...
Law of Diminishing Marginal Returns
DefinitionIn economics, diminishing returns is the decrease in the marginal output of a production process as the amount of a single factor of production is incrementally increased, while the amounts of all other factors of production stay constant. Law of Diminishing Marginal Returns What is the 'Law of Diminishing Marginal Returns' The law of diminishing marginal returns...
Credit Default Swap
DefinitionA credit default swap is a financial swap agreement that the seller of the CDS will compensate the buyer in the event of a debt default or other credit event. That is, the seller of the CDS insures the buyer against some reference asset defaulting. Credit Default Swap Credit Default Swap (CDS) is a financial contract whereby the loan...
Hard Asset
Definition In finance, a "hard asset" may be real estate, commodities, or energy. For example, gold and silver are regarded as "hard" assets. Other types of raw materials, such as oil, copper, and aluminium. are also considered "hard" assets. What is 'Hard Asset' A tangible and physical item or object of worth that is owned by an individual or a corporation. In...
Federal Deposit Insurance Corporation (FDIC)
What is the 'Federal Deposit Insurance Corporation - FDIC' The Federal Deposit Insurance Corporation (FDIC) is the U.S. corporation insuring deposits in the United States against bank failure. The FDIC was created in 1933 to maintain public confidence and encourage stability in the financial system through the promotion of sound banking practices. The FDIC insures deposits of...
Illiquid
What does 'Illiquid' mean Illiquid refers to the state of a security or other asset that cannot easily be sold or exchanged for cash without a substantial loss in value. Illiquid assets may also be hard to sell quickly because of a lack of ready and willing investors or speculators to purchase the asset. Additionally, a company may be deemed...
Accelerated Amortization
What is 'Accelerated Amortization' Extra payments made toward the reduction of a mortgage's principal balance. In the case of accelerated amortization, the loan borrower is given the option of making extra payments to their mortgage bill in order to pay off their mortgage prior to the loan settlement date. The advantage of doing so is that total interest payments are...
Life Insurance
DefinitionLife insurance is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money in exchange for a premium, upon the death of an insured person. Depending on the contract, other events such as terminal illness or critical illness can also trigger payment. The policy...
Absorbed
What is 'Absorbed' 1. In a general business sense, when a cost is treated as an expense instead of being passed on to the customer in the form of higher prices. Explaining 'Absorbed' 1. For example, if a peanut butter company's cost for peanuts increases from 50 cents per jar to $1.00 per jar...