Financial terms

November 19, 2019

Definition of a dividend

A dividend is a payment by a company to its shareholders representing a portion of earnings. The board of directors of the firm determines the amount paid in a dividend.In order to calculate a dividen...

November 19, 2019

Definition of Diversification

Diversification is the act of spreading investments amongst different assets, companies and sectors. The idea behind this is to reduce risk. If one investment fails, the investor will only lose a prop...

November 19, 2019

Definition of a Divergence

Divergence is when two items move in different directions to each other, and away from each other. In finance, the term divergence is applied to asset prices, indicators and indices.Divergence can pro...

November 19, 2019

Definition of A distressed asset

A distressed asset is one which is in major financial difficulty, usually either in default or close to default. This will have caused the asset to greatly devalue. Distressed assets can be a good opp...

November 19, 2019

Definition of A Discount Rate?

A discount rate is the rate of interest used in a DCF to convert future cash flows into a present cash value.The discount rate has to take into account the risk of future cash flows, as well...

November 19, 2019

Definition of Dilution

Dilution is a financial concept to represent a decrease in value and can apply to either a transaction or a bond. For both, it refers to the fact that value is lost purely on paper.In a transaction, d...

November 19, 2019

Definition of A Derivative

A derivative is a financial product whose value is derived from another asset (also known as the underlying asset). Derivatives are frequently used for speculation and hedging of risk and the most com...

November 19, 2019

Definition of Delta

Delta is a term used in trading to compare the change in the price of a derivative compared to the change in the price of the underlying asset. Delta is one of the 5 technical risk rati...