Liquidity
How easily an asset can be traded without materially moving its price.
Bid-ask spreadTrading volume
Explain it →FINRATEX · MARKET ATLAS
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Liquidity
How easily an asset can be traded without materially moving its price.
Read the clear explanation →Bid-ask spread
The gap between the best available bid and ask prices.
LiquiditySlippage
Explain it →Volatility
The magnitude and speed of price changes over a period.
Implied volatilityMaximum drawdown
Explain it →Trading volume
The number of shares, contracts or value traded during a period.
LiquidityMarket depth
Explain it →Market depth
The distribution of resting buy and sell orders across price levels.
LiquidityBid-ask spread
Explain it →Slippage
The difference between the expected trade price and the average execution price.
Bid-ask spreadLiquidity
Explain it →Inflation
A sustained rise in the general price level, not merely an increase in one product.
Core inflationReal interest rate
Explain it →Core inflation
A measure designed to track underlying price pressure by excluding selected volatile or administered items.
InflationPolicy rate
Explain it →Policy rate
The key interest rate a central bank uses to communicate and implement monetary policy.
Real interest rateYield curve
Explain it →Real interest rate
The return left after adjusting a nominal interest rate for expected or realized inflation.
Policy rateInflation
Explain it →Yield curve
A line showing yields across maturities for bonds of similar credit quality.
Policy rateDuration
Explain it →Risk premium
The extra return demanded for holding a riskier asset over a low-risk benchmark.
Yield curveDiscount rate
Explain it →EBITDA
Earnings before interest, taxes, depreciation and amortization, a pre-financing operating measure.
EBITDA marginFree cash flow
Explain it →EBITDA margin
EBITDA divided by revenue, showing how sales convert into operating earnings.
EBITDAGross margin
Explain it →Free cash flow
Cash left after operating cash generation and capital expenditure.
EBITDANet debt
Explain it →Net debt
Interest-bearing debt less cash and cash equivalents.
EBITDAFree cash flow
Explain it →Price-to-earnings ratio
Share price divided by earnings per share.
Earnings per shareEV/EBITDA
Explain it →EV/EBITDA
A multiple comparing enterprise value, including equity and net debt, with EBITDA.
EBITDANet debt
Explain it →Return on equity
Net income divided by average shareholders' equity.
Net debtPrice-to-earnings ratio
Explain it →Bond
A security representing an issuer's borrowing under specified terms.
DurationYield curve
Explain it →Duration
A measure of the weighted timing of bond cash flows and price sensitivity to interest rates.
BondYield curve
Explain it →Exchange-traded fund (ETF)
A fund traded on an exchange that tracks an index, asset basket or strategy.
Net asset valueTracking difference
Explain it →Net asset value
A fund's assets minus liabilities, divided by units outstanding.
Exchange-traded fund (ETF)Tracking difference
Explain it →Dividend yield
Annual dividend per share divided by share price.
Free cash flowDividend payout ratio
Explain it →Futures contract
A standardized contract obliging parties to buy or sell an asset later under specified terms.
LeverageMargin call
Explain it →Option
A contract giving the buyer the right, but not the obligation, to buy or sell an asset at a set price.
Implied volatilityLeverage
Explain it →Implied volatility
Volatility inferred from option prices, reflecting the market's priced magnitude of future moves.
OptionVolatility
Explain it →Leverage
Using limited equity or margin to control a larger economic exposure.
Margin callFutures contract
Explain it →Margin call
A request for additional collateral after losses or a change in margin requirements.
LeverageFutures contract
Explain it →Hedging
Reducing the impact of an adverse move in one exposure through another instrument or transaction.
CorrelationFutures contract
Explain it →Correlation
A measure from -1 to +1 summarizing the direction and strength of co-movement between two variables.
VolatilityHedging
Explain it →Maximum drawdown
The largest percentage fall from a peak to a subsequent trough over a selected period.
VolatilityCorrelation
Explain it →Discount rate
The rate used to translate future cash flows into present value.
Risk premiumFree cash flow
Explain it →Gross margin
Gross profit after direct cost of sales divided by revenue.
EBITDA marginNet margin
Explain it →Net margin
Net income divided by revenue.
Gross marginEBITDA margin
Explain it →Working capital
The difference between short-term operating assets and liabilities.
Free cash flowGross margin
Explain it →Debt-to-equity ratio
Debt divided by equity; the chosen debt definition should be stated.
Net debtReturn on equity
Explain it →Earnings per share
Net income attributable to common shareholders divided by weighted-average shares.
Price-to-earnings ratioReturn on equity
Explain it →Tracking difference
The realized return gap between an index fund and its benchmark.
Exchange-traded fund (ETF)Net asset value
Explain it →Dividend payout ratio
Dividends paid as a share of earnings or free cash flow.
Dividend yieldFree cash flow
Explain it →Base effect
The influence of the prior comparison level on a year-over-year growth rate.
InflationCore inflation
Explain it →Compound return
Return earned on principal plus prior-period gains.
Real interest rateNet asset value
Explain it →Currency risk
Exposure of an asset, liability or cash flow to movements between currencies.
HedgingRisk premium
Explain it →Market capitalization
Share price multiplied by total shares outstanding.
EV/EBITDANet debt
Explain it →