Target Cash Balance
What is 'Target Cash Balance' The ideal amount of cash that a company wishes to hold in reserve at any given point in time. This figure hopes to strike a balance between the investment opportunity costs of holding too much cash and the balance sheet costs of holding too little. Companies with excess cash on hand may...
Naked Trust
Definition A naked trust is a trust in which the beneficiary has a right to both income and capital and has the ability to request that both be transferred into his own name, as opposed to a remainder trust. Assets in a bare trust are kept in the name of the trustee, but the beneficiary has the right to receive...
Underinvestment Problem
What is an 'Underinvestment Problem' When a corporation refuses to invest in low-risk assets in order to increase its wealth at the expense of debt holders, this is referred to as an agency dilemma. Low-risk initiatives give more security for the firm's loan holders since they may create a consistent stream of income that can be used to repay the...
Natural Gas Storage Indicator (EIA Report)
What is 'Natural Gas Storage Indicator - EIA Report' The U.S. Energy Information Administration (EIA) weekly estimate of working natural gas volumes held in underground storage facilities at the national and regional levels. Changes in these gas inventories on a weekly basis primarily reflect net withdrawals or injections. The report is generally reported every Thursday at 10:30am...
Earnings
The amount of money that a company generates during a specific time period is called as ‘earnings’. This amount of money, to put it simply is the profits it has made in a certain amount of time which is usually defined as a quarter or a year. Earnings: Simple to calculate or complex? To elaborate this further, consider you have a...
Keiretsu
Definition Keiretsu is a group of companies that are intertwined in terms of business relationships and stock ownership. An example of an informal business group is the entrepreneur's association. During the second half of the twentieth century, the keiretsu retained its grip on the Japanese economy. What is 'Keiretsu' A loose agglomeration of businesses that share one or more common denominators is...
Depreciation
What is depreciation and how does it work Depreciation is an accounting method used to spread the cost of a long-term asset over its useful life. depreciation is used to account for declines in value due to obsolescence, wear and tear, or depletion. The depreciation expense is reported on the income statement as a reduction of revenue. For tax purposes,...
Credit Card
DefinitionA credit card is a payment card issued to users to enable the cardholder to pay a merchant for goods and services based on the cardholder's promise to the card issuer to pay them for the amounts so paid plus the other agreed charges. The card issuer creates a revolving account and grants a line of credit to the...
Portfolio
The grouping together of financial assets like cash equivalents, bonds, stocks and their counterparts whether they are closed fund or exchange related is known as a portfolio. These portfolios are managed by financial professionals but are held by investors. Understanding Portfolio A portfolio should be assembled after keeping the investing objectives and risk tolerance in mind. Let’s take an...
Short
Source: WikipediaLast Sourced: 2021-02-01This Article has been Edited for Accessibility Further Reading Cointegration: how short is the long run? - www.sciencedirect.com The economics of short-term performance obsession - www.tandfonline.com Short-term financing in a cash-constrained supply chain - www.sciencedirect.com Cash holding, trade credit and access to short-term bank finance - www.sciencedirect.com The twin deficits hypothesis and reverse causality: A...