401(k) Match
The annual dollar value of employer matching contributions to a 401(k) plan.
Accrued Interest
The portion of the next coupon payment that has accumulated since the last coupon date, paid by the buyer to the seller at settlement.
After-Tax Return
The net investment return remaining after paying applicable income or capital gains taxes.
Altman Z-Score
A multi-factor bankruptcy prediction model combining five financial ratios into a single score.
Fixed Annuity Payout
Annual payment from a fixed annuity given a starting balance, interest rate, and payout period.
Life Annuity Payout
Estimated annual income from a life annuity, assuming payments last until the expected end of life.
APR to APY
Converts a nominal Annual Percentage Rate (APR) to Annual Percentage Yield (APY), accounting for compounding.
APY to APR
Converts an Annual Percentage Yield (APY) back to the equivalent nominal Annual Percentage Rate (APR).
Asset Turnover
Measures how much revenue a company generates for every dollar of assets it holds.
Beta
Measures a stock's sensitivity to market movements — how much it tends to rise or fall relative to the overall market.
Bond Equivalent Yield
Converts a semi-annual yield to an effective annual yield using compound interest.
Big Mac FX
The PPP-implied exchange rate derived from comparing Big Mac prices across countries.
BS Call
The theoretical fair value of a European call option derived from the Black-Scholes model.
BS Put
The theoretical fair value of a European put option derived from the Black-Scholes model.
Bond Price
The present value of a bond's future coupon payments and par repayment, discounted at the required yield.
BVPS
The per-share value of a company's net assets — total equity minus preferred equity, divided by shares outstanding.
BRRRR Return
Measures what percentage of original cash invested is recovered through a cash-out refinance after the Buy, Rehab, Rent, Refinance, Repeat cycle.
CAGR
The steady annual growth rate that takes an investment from its starting value to its ending value over a given period.
Calmar Ratio
Compares a fund's annualised growth rate to its worst drawdown — a risk-adjusted return metric for drawdown-sensitive investors.
Cap Rate
The ratio of a property's net operating income to its market value, expressing the expected return on an all-cash real estate investment.
Capital Gains Tax
US tax on profit from selling a capital asset, with lower rates for assets held over one year.
CAPM
Estimates a stock's required return based on its beta and the expected market risk premium.
Capture Ratios
Measure how much of a benchmark's gains a fund captures in rising markets, and how much of its losses it incurs in falling markets.
20/4/10 Car Rule
The maximum car price you can afford: 20% down, 4-year loan, monthly payment under 10% of gross income.
Carry Trade Return
Total return from borrowing in a low-rate currency and investing in a high-rate currency.
Cash Conversion Cycle
The number of days it takes to convert inventory investments into cash from sales.
Cash-on-Cash Return
The ratio of annual pre-tax cash flow to total cash invested, measuring the leveraged yield on a real estate investment.
Cash Ratio
The strictest liquidity measure — cash and equivalents divided by current liabilities.
Coast FIRE
The portfolio balance today that will grow to your FIRE number by retirement without any further contributions.
Compound Interest
Earning interest on both principal and previously earned interest.
Convexity
The second-order measure of a bond's price sensitivity to yield changes, capturing the curvature that modified duration misses.
Correlation
Measures how consistently two return series move together, from −1 (perfect inverse) to +1 (perfect positive).
Coupon Payment
The periodic interest payment a bondholder receives, equal to the face value multiplied by the coupon rate divided by the payment frequency.
Credit Spread
The additional yield a corporate bond pays over a comparable-maturity Treasury bond, compensating investors for credit risk.
Credit Utilization
Total credit card balances as a percentage of total credit limits — the second-largest FICO score factor.
Current Ratio
Measures a company's ability to cover short-term liabilities with short-term assets.
DCA Return
Calculates the total return of a DCA strategy by averaging purchase prices across multiple periods.
Debt-to-Assets
The proportion of a company's assets financed by debt.
D/E Ratio
Compares a company's total debt to its shareholders' equity.
DeFi APY
Converts a DeFi protocol's quoted APR into the effective Annual Percentage Yield, accounting for how often returns are compounded.
DIME Method
A life insurance needs formula covering Debt, Income, Mortgage, and Education.
DIO
The average number of days a company holds inventory before selling it.
Disability Need
Monthly income benefit required to replace a percentage of earnings if you become disabled.
Discounted Payback
The time to recover the initial investment using present-value-adjusted cash flows.
Dividend Yield
Annual dividends per share expressed as a percentage of the stock price.
DPO
The average number of days a company takes to pay its suppliers.
DSCR
The ratio of a property's net operating income to its annual mortgage payments, used by lenders to determine whether a property qualifies for financing.
DSO
The average number of days it takes a company to collect payment after a sale.
DTI Ratio
Monthly debt payments as a percentage of gross monthly income, used to qualify for mortgages.
DuPont 3-Step
Decomposes Return on Equity into three drivers: net profit margin, asset turnover, and financial leverage.
EBITDA Margin
Operating profitability as a percentage of revenue, before interest, taxes, depreciation, and amortization.
Effective Annual Rate
The actual annual return on a loan or investment after accounting for intra-year compounding.
Effective Duration
A numerical duration measure that uses actual price changes from parallel yield shifts, suitable for bonds with embedded options.
Emergency Fund
Liquid savings equal to 3–6 months of living expenses held to cover unexpected events.
Enterprise Value
The total value of a business — equity plus debt minus cash.
EPS
The portion of a company's profit allocated to each outstanding share.
EV/EBIT
Enterprise Value divided by operating profit (EBIT) — a capital-structure-neutral earnings multiple.
EV/EBITDA
Compares a company's total value to its earnings before interest, taxes, depreciation, and amortisation.
EV/Revenue
Enterprise Value divided by annual revenue — a capital-structure-neutral alternative to the P/S ratio.
FCF Yield
Free cash flow expressed as a percentage of market capitalisation.
Federal Income Tax
Estimated US federal income tax owed for 2025 using progressive tax brackets and standard deduction.
50% Rule
A rule of thumb estimating that approximately 50% of a rental property's gross rent is consumed by operating expenses — excluding mortgage payments.
FIRE Number
The total portfolio size needed to retire early and live off investment returns indefinitely.
Future Value
The value of a current asset at a specified future date, assuming a given rate of return.
Futures Price
The theoretical no-arbitrage price of a futures contract based on the cost of carry.
FV of Annuity
How much a series of equal periodic deposits will grow to at a given interest rate.
FX Cross Rate
A currency exchange rate derived indirectly via a common third currency (usually USD).
GDP Growth
The percentage change in a country's gross domestic product over a given period.
Graham Number
Benjamin Graham's formula for the maximum price a defensive investor should pay for a stock, based on EPS and book value.
Gross Margin
The percentage of revenue remaining after deducting the cost of goods sold.
Gross Rent Multiplier
The ratio of a property's purchase price to its annual gross rental income, used as a quick screening tool before deeper due diligence.
Growing Perpetuity
The present value of a cash flow that grows at a constant rate forever.
Health OOP Max
Total out-of-pocket medical cost after deductible and coinsurance, capped at the plan's OOP maximum.
HSA Limit
IRS annual contribution limit for Health Savings Accounts, including the 55+ catch-up amount.
Human Life Value
The present value of a person's future earning potential, used to estimate life insurance needs.
Impermanent Loss
The percentage value lost by a liquidity provider compared to simply holding the tokens, due to price divergence between the two pooled assets.
Implied Vol (IV)
The volatility level implied by an option's market price, derived by reverse-solving the Black-Scholes formula.
Inflation-Adjusted Value
The real purchasing-power equivalent of a future dollar amount in today's dollars.
Information Ratio
Measures how consistently a fund generates active return above its benchmark per unit of active risk (tracking error).
Interest Coverage
How many times a company's operating profit covers its interest expense.
Interest Rate Parity
The no-arbitrage forward exchange rate implied by the interest rate differential between two countries.
Intrinsic Value
The immediate exercise value of an option — how much it is in the money.
Inventory Turnover
How many times a company sells and replaces its inventory during a period.
IRR
The discount rate at which a project's net present value equals zero.
Jensen's Alpha
The excess return a portfolio earns above what CAPM predicts given its level of systematic risk.
Kelly Criterion
Calculates the optimal fraction of capital to allocate per trade or bet to maximize long-run portfolio growth.
LTC Cost
Projects the future cost of long-term care by applying an inflation rate to today's cost.
Macaulay Duration
The weighted-average time (in years) to receive all of a bond's cash flows, used as a measure of interest rate sensitivity.
Market Cap
The total market value of all a company's outstanding shares.
Max Drawdown
The largest peak-to-trough decline in a portfolio's value — the worst-case loss any investor could have experienced.
Medicare IRMAA
Additional Medicare Part B premium paid by higher-income enrollees based on MAGI.
MIRR
An improved version of IRR that uses separate rates for financing costs and reinvestment returns.
Misery Index
The sum of the unemployment rate and the inflation rate — a simple gauge of economic hardship.
Modified Duration
Estimates the percentage price change of a bond for a 1% change in yield.
Net Margin
The percentage of revenue that remains as profit after all expenses and taxes.
Net Worth
Total assets minus total liabilities — the most fundamental measure of personal financial health.
NOI
Annual gross income from a property minus all operating expenses, excluding mortgage payments, taxes on income, depreciation, and capital expenditures.
NPV
The sum of all discounted future cash flows from a project minus the initial investment.
1% Rule
A quick-filter rule that says monthly rent should be at least 1% of the purchase price for a rental property to generate positive cash flow.
Operating Margin
The percentage of revenue remaining after all operating costs — before interest and taxes.
Delta (Call)
The rate of change in a call option's price for a $1 move in the underlying stock.
Delta (Put)
The rate of change in a put option's price for a $1 move in the underlying stock.
Gamma
The rate of change in an option's delta for a $1 move in the underlying stock.
Rho (Call)
The change in a call option's price for a 1% increase in the risk-free interest rate.
Rho (Put)
The change in a put option's price for a 1% increase in the risk-free interest rate.
Theta (Call)
The daily time decay of a call option's price, holding all other factors constant.
Theta (Put)
The daily time decay of a put option's price, holding all other factors constant.
Time Value
The portion of an option's price beyond its intrinsic value, reflecting the remaining time to expiry.
Vega
The change in an option's price for a 1% increase in implied volatility.
Payback Period
The time it takes for a project to recover its initial investment from undiscounted cash flows.
P/E Ratio
Measures how much investors pay per dollar of earnings.
PEG Ratio
Adjusts the P/E ratio by a company's expected earnings growth rate.
Piotroski F-Score
A 9-point scoring system that grades a company's financial health across profitability, leverage, and efficiency.
Present Value
The current worth of a future sum of money, discounted at a required rate of return.
Duration Price Approximation
Approximates the dollar price change of a bond from a given yield shift using modified duration.
P/CF Ratio
Compares a stock's price to its operating cash flow per share, reducing the impact of accounting adjustments.
P/FCF Ratio
Compares a company's market capitalization to its free cash flow — the cash left after capital expenditures.
P/S Ratio
Measures how much investors pay for each dollar of a company's annual revenue.
Profitability Index
The ratio of the present value of future cash inflows to the initial investment cost.
PPP
An implied exchange rate based on the ratio of price levels between two countries.
Put-Call Parity
The no-arbitrage relationship between European call and put prices on the same underlying.
PV of Annuity
The current worth of a series of equal periodic payments, discounted at a required return.
PV of Perpetuity
The current worth of a stream of equal payments that continues indefinitely.
Quick Ratio
A stricter liquidity test that excludes inventory from current assets.
R-Squared
The proportion of a fund's return variation explained by its benchmark, from 0 (no relationship) to 1 (perfect fit).
Real Interest Rate
The nominal interest rate adjusted for inflation using the Fisher equation.
Real Return
An investment's return after subtracting the inflation rate.
Real Yield
The inflation-adjusted return on a bond, calculated using the exact Fisher equation.
Receivables Turnover
How many times a company collects its average accounts receivable during a year.
Refi Break-Even
The number of months until monthly savings from refinancing recover the closing costs.
Rent vs Buy
The number of years until buying a home produces greater net wealth than renting and investing the difference.
Retention Ratio
The proportion of net income reinvested back into the business rather than paid as dividends.
ROA
Measures how efficiently a company uses its total assets to generate net income.
ROE
Measures how much profit a company generates per dollar of shareholders' equity.
ROIC
Measures how efficiently a company generates profit from all capital invested by shareholders and debt-holders.
Rule of 72
A shortcut to estimate how many years it takes to double an investment at a given annual return.
Safe Withdrawal Rate
The annual percentage of a retirement portfolio you can withdraw without depleting it over 30 years.
Savings Rate
Monthly savings as a percentage of take-home pay — the single most powerful driver of wealth accumulation.
Sharpe Ratio
Measures excess return per unit of total volatility — the most widely used risk-adjusted performance metric.
Sortino Ratio
Like the Sharpe ratio but penalises only downside volatility — better for asymmetric return distributions.
Standard Deviation
Measures the dispersion of returns around the average — the most common gauge of investment volatility.
Student Loan Payoff
Monthly payment needed to fully repay a student loan over a given term, plus total interest cost.
Sustainable Growth Rate
The maximum growth rate a company can achieve without raising additional external capital.
Tax-Equivalent Yield
The pre-tax yield a taxable bond must offer to match the after-tax return of a tax-exempt municipal bond.
Term Life Need
Estimates required life insurance coverage based on income, debts, existing coverage, and liquid assets.
Token Dilution
Measures the percentage increase in a token's total supply when new tokens are minted, quantifying how existing holders' ownership is reduced.
Trad vs Roth IRA
Comparison of after-tax retirement balances between a Traditional (pre-tax) and Roth (after-tax) IRA.
Treynor Ratio
Measures excess return per unit of systematic (market) risk — useful for comparing diversified portfolios.
True Car Cost
The total 5-year cost of vehicle ownership including depreciation, financing, fuel, insurance, and maintenance.
2% Rule
A strict real estate screening rule stating monthly rent should be at least 2% of the purchase price, targeting high cash-flow investment properties.
Vacancy Rate
The percentage of available rental time during which a property or unit is unoccupied and generating no rental income.
Value at Risk
The maximum dollar loss not expected to be exceeded over a given period at a specified confidence level.
Variance
The average squared deviation of returns from their mean — the square of standard deviation.
Yield Curve Slope
The spread between the 10-year and 2-year Treasury yields — a key recession indicator.
Yield to Call
The annualised return an investor earns if a callable bond is called by the issuer on the first call date.
Yield to Maturity
The total annualised return an investor earns by holding a bond to maturity, accounting for price, coupons, and par repayment.