Investing glossary
Plain-language definitions of the investing terms you meet in filings, in the news and in Finzer.
49 terms, all of them on this page
C
Call Option
A call option gives you the right-but not the obligation-to buy a stock at a fixed price before a set date. Learn how call options work, what drives their value, and how smart investors actually use them.
Callable Bond
A callable bond is a bond that allows the issuer to repay it early at a set price before maturity. Learn why issuers use them, how they affect yields, and what investors should do.
Capital Allocation
Capital allocation is how a company decides to deploy its cash and balance sheet across investments, buybacks, dividends, and debt. Learn how great capital allocation drives long-term returns-and how to spot it as an investor.
Capital Asset Pricing Model
The Capital Asset Pricing Model estimates an asset’s expected return using its risk relative to the market (beta) and the risk-free rate. Learn how investors actually use CAPM, when it works, and when it can mislead you.
Capital Expenditures
Capital expenditures are long-term investments a company makes in assets like buildings, equipment, or technology that will be used for more than one year. Learn how to analyze CapEx, why it matters for cash flow and growth, and how investors should use it in real decisions.
Capital Gains
Capital gains are the profits you earn when you sell an asset for more than you paid for it. Learn how they’re calculated, taxed, and managed in real portfolios.
Capital Intensity
Capital intensity measures how much capital a business needs to generate a dollar of revenue or profit. Learn how it shapes returns, risk, and valuation across industries.
Capital Raise
A capital raise is when a company secures new funding by issuing equity, debt, or hybrid securities. Learn why companies raise capital, how it affects shareholders, and how investors should respond.
Capital Structure
A capital structure is the mix of debt and equity a company uses to fund its business. Learn how it affects risk, returns, valuations, and what investors should actually watch.
Capitulation
Capitulation is a market phase marked by panic selling and extreme volume after a sharp decline, often signaling that sellers are finally exhausted. Learn how to spot it, why it matters, and how smart investors actually use it.
Cash Conversion Cycle
The cash conversion cycle measures how long a company takes to turn cash spent on inventory into cash received from customers. Learn how to calculate it, what drives it, and how investors use it to spot strong operators.
Cash Flow
Cash flow is the net amount of cash moving into and out of a business over a period of time. Learn how to read it, why it matters more than profits, and how investors actually use it.
Cash Flow Statement
A cash flow statement shows how much actual cash a company generates and uses across operating, investing, and financing activities in a given period. Learn how to read it, spot red flags, and use cash flow to make smarter investment decisions.
Cash Ratio
The cash ratio measures a company’s ability to pay short-term liabilities using only cash and cash equivalents. Learn how to read it, when it matters, and how investors actually use it.
Central Bank
A central bank is a public institution that controls a country’s money supply, interest rates, and financial system stability. Learn how central banks really work, why markets obsess over them, and how investors should react.
Clearing and Settlement
Clearing and settlement are the post-trade processes that confirm, net, and exchange cash and securities-typically completed on T+1 in U.S. markets. Learn how trades really get finished, why delays matter, and what investors should watch.
Closed-End Fund
A closed-end fund is an investment fund with a fixed number of shares that trade on an exchange, often at a discount or premium to net asset value. Learn how they work, why prices diverge from value, and how investors use them for income and opportunity.
Commodity
A commodity is a standardized raw material or basic good that’s interchangeable regardless of who produces it. Learn how commodities trade, what moves their prices, and how investors actually use them.
Company Valuation
Company valuation is the process of estimating what a business is worth, using financial metrics, growth assumptions, and risk. Learn how valuations are calculated, what drives them, and how investors should actually use them.
Compound Annual Growth Rate
Compound Annual Growth Rate (CAGR) is the annualized rate of return that smooths growth over time as if it occurred evenly each year. Learn how investors use it, how to calculate it, and where it can mislead you.
Compound Interest
Compound interest is the process where your returns earn returns, causing wealth to grow exponentially over time. Learn how it works, why time matters more than rate, and how investors actually use it.
Consumer Price Index
The Consumer Price Index (CPI) measures the average change in prices paid by consumers for a fixed basket of goods and services over time. Learn how CPI is calculated, what drives it, and how investors actually use it.
Consumer Price Index (CPI)
The Consumer Price Index (CPI) measures the average change in prices paid by consumers for a fixed basket of goods and services over time. Learn how CPI is calculated, why markets react to it, and how investors actually use it.
Contribution Margin
Contribution margin is the percentage of revenue left after covering variable costs. Learn how investors use it to judge pricing power, operating leverage, and scalability.
Core Inflation
Core inflation measures price changes excluding food and energy, focusing on underlying inflation trends. Learn how investors use it, why central banks obsess over it, and how it impacts markets.
Corporate Action
A corporate action is a decision by a company that directly changes its securities or impacts shareholders’ economic rights. Learn the types, causes, mechanics, and how smart investors actually respond.
Corporate Bond
A corporate bond is a debt security issued by a company that pays investors fixed or floating interest and returns principal at maturity. Learn how corporate bonds work, what drives their risk and returns, and how investors actually use them.
Correlation
Correlation measures how two assets move in relation to each other, on a scale from -1 to +1. Learn how investors use correlation to build portfolios, manage risk, and avoid false diversification.
Cost of Capital
Cost of capital is the minimum return a company must earn to justify using investors’ money. Learn how it’s calculated, what drives it, and how investors use it to judge risk and value.
Cost of Equity
Cost of equity is the return shareholders expect for owning a company’s stock, given its risk. Learn how it’s calculated, what drives it, and how investors actually use it.
Cost of Goods Sold
Cost of goods sold is the direct cost a company incurs to produce or purchase the products it sells during a period. Learn how it drives margins, earnings quality, and valuation.
Cost of Living
Cost of living measures how much it costs to maintain a given standard of living in a specific place and time. Learn how it’s calculated, what drives changes, and why investors should care.
Cost of Revenue
Cost of revenue is the direct cost a company incurs to produce and deliver the goods or services it sells. Learn how it affects margins, earnings quality, and how investors should analyze it.
Counterparty Risk
Counterparty risk is the chance that the other party in a financial contract fails to meet its obligations. Learn where it hides, how it shows up in real markets, and how investors manage it.
Coupon
A coupon is the fixed annual interest rate a bond pays on its face value. Learn how coupons work, what drives them, and how investors actually use them.
Coupon Rate
The coupon rate is the fixed annual interest rate a bond pays, expressed as a percentage of its face value. Learn how it works, what drives it, and how to use it correctly as an investor.
Covariance
Covariance measures how two assets move together over time, showing whether their returns tend to rise and fall in the same direction or opposite ones. Learn how investors use covariance to build diversified portfolios and manage risk.
Credit Derivatives
Credit derivatives are financial contracts that transfer credit risk-like default or downgrade-from one party to another without selling the underlying asset. Learn how they work, why they matter, and how investors should think about them.
Credit Rating
A credit rating is an independent assessment of a borrower’s ability to repay debt, expressed as a letter grade like AAA or BBB-. Learn how ratings work, what moves them, and how investors actually use them.
Credit Risk
Credit risk is the probability that a borrower fails to make interest or principal payments as agreed. Learn how it impacts bonds, stocks, and portfolios-and how smart investors manage it.
Credit Spread
A credit spread is the difference in yield between a risky bond and a comparable risk‑free bond, usually Treasuries. Learn how to read credit spreads, what causes them to widen or tighten, and how investors actually use them.
Currency Depreciation
Currency depreciation is a decline in a country’s currency value relative to others in the foreign exchange market. Learn what causes it, how it works, and how investors should respond.
Current Account
The current account tracks a country’s trade in goods, services, income, and transfers with the rest of the world. Learn how deficits and surpluses affect currencies, markets, and your investments.
Current Account Balance
A current account balance measures a country’s net trade in goods and services plus income and transfers with the rest of the world. Learn why it moves currencies, bonds, and global portfolios.
Current Assets
Current assets are resources a company expects to convert into cash within 12 months. Learn how to analyze them, why liquidity matters, and how investors actually use this data.
Current Liabilities
Current liabilities are a company’s obligations due within 12 months, including payables, short-term debt, and accrued expenses. Learn how they affect liquidity, risk, and investment decisions.
Current Ratio
The current ratio measures a company’s ability to pay its short-term obligations using short-term assets. Learn how to calculate it, interpret it, and avoid common traps investors fall into.
Current Yield
Current yield measures a bond’s annual income as a percentage of its current market price. Learn how to calculate it, what drives it, and how investors actually use it.
CUSIP
A CUSIP is a 9-character alphanumeric code that uniquely identifies a specific security in North America. Learn how it works, why it matters, and how investors actually use it.