Data- The most misunderstood finance terms

	A	B	C	D	E
1	Finance term	Definition	Ahrefs Global volume for 'Keyword definition'	Ahrefs other searches such as 'Keyword meaning'	Total
2	Investment	An investment is an asset which has the potential to grow in value. More commonly known investments are real estate, stocks, and bonds. Whereas cars, unless antique and a collectible, are not investments because they depreciate.	17,000		17,000
3	Interest	Interest is the cost of borrowing money. When you borrow money, you pay interest. When you “lend” your money to the bank, you earn interest – even if it’s just a measly few pennies.	18,000	4,400	22,400
4	Dividends	Dividends are a portion of a company’s profits which are distributed to the company’s shareholders. In simpler terms, when you own a share of a company’s stock, you get paid some cash depending on whether that company decides to issue a dividend. FYI: Not every company pays dividends.	12,000	6,000	18,000
5	Equity	Equity and stock are often used interchangeably to represent partial ownership in a company. If you own a house for example, you may often hear phrases like “I have 20% equity in the home.” This means that you have paid off 20% of the home value but still owe 80%.	89,000	22,400	111,400
6	Fixed Income	Fixed Income is generally interest that is predictable and paid in regular frequencies. Bonds and certificates of deposit (CDs) are examples of fixed income investments.	2,400		2,400
7	Tax-deferred	Tax-deferred implies that money in an account will be taxed later when you take the money out. For example, funds going into your traditional 401(k) are not taxed at the time of contribution, but it will be taxed as you withdraw from it during retirement.			0
8	Tax-free	Tax-free status implies that money in an account can grow and be withdrawn later without being taxed. For example, contributions to your Roth IRA or 529 account are made with after-tax money; so, when you withdraw from it later, you will not be taxed.			0
9	Taxable	Taxable status indicates that money in an account is taxed each year. These are your investment, checking, and money market accounts. Typically, you will get a 1099 for any interest or dividends earned.			0
10	Asset allocation	Asset allocation refers to how you divide money across different kinds of investments.	1,400		1,400
11	Compound Interest	Compound interest is interest that accumulates over time, based on your total account balance, both principal and interest. This can either work for you or against you.	9,200		9,200
12	Rebalancing	Rebalancing involves making changes to your asset allocation by buying and selling in a way that shifts money to specific types of investments.			0
13	Amortisation	The process of making a predetermined monthly debt payment, for a predetermined length of time.	1,400	3,800	5,200
14	Capital gain	Capital gains refer to how much an asset’s value has increased from the time you bought it to the time you sell it. For example, if you buy stock at $5 a share and later sell it for $10, that’s a $5 capital gain.	1,900		1,900
15	Principal	A loan’s principal is the amount borrowed before any interest is added on. If you take out a $5,000 personal loan, that $5,000 is the principal.	89,000	7,000	96,000
16	Annual Percentage rate	The annual percentage rate (APR) of a loan or line of credit is how much yearly interest you’ll pay on that debt plus other fees. It’s expressed as a percentage, like “3%” or “24.99%.”	1,800		1,800
17	Fico score	A FICO score is a measure of creditworthiness. It’s a type of credit score that tells lenders how well you manage debts and how likely you are to make on-time payments.	1,100		1,100
18	Delinquency	When you fall behind on your monthly debt obligations, the account enters delinquency. This is a fancy way of saying that your payments are past due.			0
19	Default	Default is more serious than delinquency. At this point, you’re so far behind on your monthly payments that the debt issuer isn’t sure you’ll catch up.			0
20	Net worth	A calculation that compares someone's assets to their liabilities.	61,000	3,100	64,100
21	Net Interest Margin	Net interest margin is a measurement comparing the net interest income a financial firm generates and the outgoing interest it pays its customers			0
22	Absolute advantage	Absolute advantage is the ability of an individual, company, region, or country to produce a greater quantity of a good or service with the same quantity of inputs per unit of time, or to produce the same quantity of a good or service per unit of time using a lesser quantity of inputs, than its competitors.			0
23	Accounting Equation	The accounting equation states that a company's total assets are equal to the sum of its liabilities and its shareholders' equity.	1,100		1,100
24	Acquisition	An acquisition is when one company purchases most or all of another company's shares to gain control of that company.	124,000	6,700	130,700
25	Amalgamation	An amalgamation is a combination of two or more companies into a new entity. Amalgamation is distinct from a merger because neither company involved survives as a legal entity	58,000	4,500	62,500
26	Asset	An asset is a resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide a future benefit.	60,000	13,700	73,700
27	Balance sheet	The term balance sheet refers to a financial statement that reports a company's assets, liabilities, and shareholder equity at a specific point in time. Balance sheets provide the basis for computing rates of return for investors and evaluating a company's capital structure.	9,800		9,800
28	Bankruptcy	Bankruptcy is a legal proceeding initiated when a person or business is unable to repay outstanding debts or obligations.	20,000		20,000
29	Block chain	A blockchain is a distributed database or ledger that is shared among the nodes of a computer network. As a database, a blockchain stores information electronically in digital format	12,000		12,000
30	Capital	Capital is a broad term that can describe anything that confers value or benefit to its owners, such as a factory and its machinery, intellectual property like patents, or the financial assets of a business or an individual.	28,000		28,000
31	Collateral loan	Collateral in the financial world is a valuable asset that a borrower pledges as security for a loan.	1,800		1,800
32	Command Economy	A command economy is a key aspect of a political system in which a central governmental authority dictates the levels of production that are permissible and the prices that may be charged for goods and services. Most industries are publicly owned.			0
33	Comparative advantage	Comparative advantage is an economy's ability to produce a particular good or service at a lower opportunity cost than its trading partners. Comparative advantage is used to explain why companies, countries, or individuals can benefit from trade.	1,100		1,100
34	Contribution margin	The contribution margin can be stated on a gross or per-unit basis. It represents the incremental money generated for each product/unit sold after deducting the variable portion of the firm's costs.	1,400		1,400
35	Correlation	Correlation, in the finance and investment industries, is a statistic that measures the degree to which two securities move in relation to each other.			0
36	Debenture	A debenture is a type of bond or other debt instrument that is unsecured by collateral. Since debentures have no collateral backing, they must rely on the creditworthiness and reputation of the issuer for support. Both corporations and governments frequently issue debentures to raise capital or funds.	15,000	2,400	17,400
37	Debt Ratio	The term debt ratio refers to a financial ratio that measures the extent of a company’s leverage. The debt ratio is defined as the ratio of total debt to total assets, expressed as a decimal or percentage. It can be interpreted as the proportion of a company’s assets that are financed by debt.	1,200		1,200
38	Deferred compensation	Deferred compensation is an addition to an employee's regular compensation that is set aside to be paid at a later date. In most cases, taxes on this income are deferred until it is paid out.	300		300
39	Economies of scale	Economies of scale are cost advantages reaped by companies when production becomes efficient. Companies can achieve economies of scale by increasing production and lowering costs. This happens because costs are spread over a larger number of goods. Costs can be both fixed and variable.	17,000	1,800	18,800
40	Gross Income	Gross income for an individual—also known as gross pay when it’s on a paycheck—is an individual’s total earnings before taxes or other deductions.	23,000		23,000
41	Gross Margin	Gross margin is net sales less the cost of goods sold (COGS). In other words, it's the amount of money a company retains after incurring the direct costs associated with producing the goods it sells and the services it provides.	6,900		6,900
42	Gross Profit	Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. Gross profit will appear on a company's income statement and can be calculated by subtracting the cost of goods sold (COGS) from revenue (sales).	10,000		10,000
43	Geometric Mean	The geometric mean is the average of a set of products, the calculation of which is commonly used to determine the performance results of an investment or portfolio. It is technically defined as "the nth root product of n numbers."			0
44	Hedge Fund	A hedge fund is a limited partnership of private investors whose money is managed by professional fund managers who use a wide range of strategies, including leveraging or trading of non-traditional assets, to earn above-average investment returns.	24,000		24,000
45	Hyperinflation	Hyperinflation is a term to describe rapid, excessive, and out-of-control general price increases in an economy. While inflation measures the pace of rising prices for goods and services, hyperinflation is rapidly rising inflation, typically measuring more than 50% per month.	5,200	4,000	9,200
46	Income statement	An income statement is one of the three important financial statements used for reporting a company’s financial performance over a specific accounting period. The other two key statements are the balance sheet and the cash flow statement.	2,900		2,900
47	Index fund	An index fund is a type of mutual fund or exchange-traded fund (ETF) with a portfolio constructed to match or track the components of a financial market index	4,100		4,100
48	Financial leverage	Financial leverage results from using borrowed capital as a funding source when investing to expand the firm's asset base and generate returns on risk capital	4,800		4,800
49	Macro Economics	Macroeconomics is a branch of economics that studies how an overall economy—the markets, businesses, consumers, and governments—behave. Macroeconomics examines economy-wide phenomena such as inflation, price levels, rate of economic growth, national income, gross domestic product (GDP), and changes in unemployment.			0
50	Overdraft	An overdraft occurs when there isn't enough money in an account to cover a transaction or withdrawal, but the bank allows the transaction anyway. Essentially, it's an extension of credit from the financial institution that is granted when an account reaches zero.	37,000	4,100	41,100
51	Overhead	Overhead refers to the ongoing business expenses not directly attributed to creating a product or service. It is important for budgeting purposes but also for determining how much a company must charge for its products or services to make a profit. In short, overhead is any expense incurred to support the business while not being directly related to a specific product or service.	26,000	2,100	28,100
52	Gross Domestic Product	Gross domestic product (GDP) is the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period.	149,000	17,300	166,300
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