Finance Glossary

Here is a list of accounting, economic and finance terms for my own records. I probably should have paid more attention in my Accounting 1A classes.

Term Definition
Balance of Trade see trade balance
budget deficit A government budget deficit means the government is spending more than it takes in tax receipts. A primary budget deficit excludes interest repayments on debt.
capitulation giving up and throwing in the towel. Closing a position at any cost. Panic selling (or short covering).
current account
DK'd trade A "don't know" trade where there is a discrepancy between parties of the trade. It could be busted or cancelled.
drawdown e.g. if my portfolio reached 100K, then went back down to 80K. I can say I had a drawdown to 80K.
impairment ?
Level 1/2/3 ?
MER - management expense ratio management expense ratio. The investor will receive the fund's performance minus the MER. MER may not take into account ALL costs, look for a TER instead.
TER - total expense ratio annual management and other running costs
Treasury Shares The company sometimes buys back shares and places them into the treasury. These shares do not receive dividends or voting rights. The are usually used for employee share plans or cancelled as part of a buy back
Trade balance This relates to countries. If positive, there is a trade surplus, it means the country exports more than it imports. If negative, there is a trade deficit, this means the country is importing more than it exports.
TWI - trade weighted index a comparison between multiple foreign currencies