GLOSSARY OF FINANCIAL & INVESTMENT TERMS
A-B C-D E-F G-H I-J K-L M-N O-P Q-R S-T U-V W-X Y-Z
Government Agency Bonds |
Government agency bonds are fixed income investments issued and backed by individual U.S. government agencies, such as the Federal Home Loan Bank or the Federal Land Bank. Although these agencies have high credit ratings, their bonds are not supported by the full faith and credit of the U.S. government. An important advantage of government and municipal bonds is the potential for federal tax savings, which can be particularly beneficial to those who fall within a high federal tax bracket. |
Government Bonds |
Government bonds are fixed income investments issued by the U.S. Government and backed by the full faith and credit of the government. What many fail to recognize however, is that the market value of U.S. government bonds is not guaranteed. Like other bonds, their value will fluctuate with changing interest rates. An important advantage of government and municipal bonds is the potential for federal tax savings, which can be particularly beneficial to those who fall within a high federal tax bracket. |
| Growth Stocks | Stocks issued by companies with fast-growing profits are called growth stocks. They are generally riskier than blue chip stocks because stock growth could plateau or fall, especially if the rise in company earnings is interrupted by competition, change in market demand, regulatory changes, changes in management or other factors. Over the long term, growth stocks generally outperform blue chips. |
Hedge Fund |
A pooled investment fund that is limited to no more than 99 accredited investors, requires a large minimum investment, ranging anywhere from $250,000 to over $1 million and requires a 1-year minimum investment for first-time investors. Because they cater to sophisticated investors, hedge funds are not registered under the Investment Company Act of 1940 and can use aggressive investment strategies, including short-selling and heavy leveraging. |
