Fair Weather Fund
What is a 'Fair Weather Fund'? A fair weather fund is a type of investment fund that tends to perform well during periods of economic prosperity, but tends to underperform or suffer significant losses during times of economic downturn or recession. These types of funds typically invest in stocks and other securities that are expected to benefit from favorable market conditions,...
Fiat Money
DefinitionFiat money is a currency without intrinsic value that has been established as money, often by government regulation. Fiat money does not have use value, and has value only because a government maintains its value, or because parties engaging in exchange agree on its value. It was introduced as an alternative to commodity money and representative money. Commodity money...
Farm Credit System (FCS)
What is 'Farm Credit System - FCS' The Farm Credit System is a nationwide network of cooperative banks and associations that provide credit to farmers, agricultural concerns and related businesses. It was created by Congress in 1916 and was originally funded by the federal government to ensure American agriculture had a dependable source of credit. It is...
Falling Three Methods
What is 'Falling Three Methods' A bearish candlestick pattern that is used to predict the continuation of the current downtrend. This pattern is formed when the candlesticks meet the following characteristics: 1. The first candle in the pattern is a long red candlestick within a defined downtrend. 2. A series of ascending small-bodied candlesticks that trade...
Federal Discount Rate
What is the 'Federal Discount Rate' The federal discount rate is the interest rate set by the Federal Reserve on loans offered to eligible commercial banks or other depository institutions as a measure to reduce liquidity problems and the pressures of reserve requirements. The discount rate allows the federal reserve to control the supply of money and...
Fade
What is a 'Fade' A fade is a contrarian investment strategy used to trade against the prevailing trend. "Fading the market" is typically very high risk, requiring the trader to have a high risk tolerance. A fade trader would sell when a price is rising and buy when it's falling. Also known as "fading". 2. In...
Forex
What is Forex Trading Forex trading is the process of buying and selling currencies on the foreign exchange market. The foreign exchange market is a global marketplace where traders buy and sell currencies. Currencies are traded against each other, and the prices of currencies fluctuate based on supply and demand. Forex trading allows traders to take advantage of these price...
Fama And French Three Factor Model
What is the 'Fama And French Three Factor Model' The Fama and French Three Factor Model is an asset pricing model that expands on the capital asset pricing model (CAPM) by adding size and value factors to the market risk factor in CAPM. This model considers the fact that value and small-cap stocks outperform markets on a...
Federal Energy Regulatory Commission (FERC)
What is 'Federal Energy Regulatory Commission - FERC' An independent agency responsible for regulating interstate oil and gas pipelines and sales, as well as the transmission of electricity from state to state. In addition, the Energy Policy Act of 2005 charged the FERC with further duties, such as imposing mandatory standard regulations. The FERC also regulates expansion...
Fed Model
DefinitionThe "Fed model" is a theory of equity valuation that has found broad application in the investment community. The model compares the stock market's earnings yield to the yield on long-term government bonds. In its strongest form the Fed model states that bond and stock market are in equilibrium, and fairly valued, when the one-year forward-looking earnings yield equals...