Letter V Vocabulary Flashcards
The process of determining the current worth of an asset or company.
Valuation
A measure of the potential loss in value of a portfolio over a specific time period for a set confidence interval.
Value at Risk (VaR)
The date on which counterparties to a financial transaction agree to settle their respective obligations.
Value Date
An investment strategy that involves buying securities deemed to be undervalued compared to their intrinsic worth.
Value Investing
An annuity whose payments vary based on the performance of investments chosen by the holder.
Variable Annuity
An interest rate that can change over time based on underlying benchmark interest rate or index.
Variable Interest Rate
A debt instrument that represents borrowed funds on which interest is paid at adjustable intervals.
Variable Rate Demand Note
A mortgage with an interest rate that adjusts periodically based on a benchmark or index.
Variable Rate Mortgage
An options strategy where the investor owns 100 shares of the underlying stock and writes two call options against it.
Variable Ratio Write
A type of life insurance that combines features of universal life insurance with an investment component.
Variable Universal Life Insurance (VUL)
A measure of an option’s sensitivity to changes in the volatility of the underlying asset.
Vega
Financing provided to startup companies and small businesses with perceived long-term growth potential.
Venture Capital
An options strategy involving buying and selling of two options of the same type with the same expiration but different strike prices.
Vertical Spread
The process by which an employee gains ownership over employer-contributed funds or stock options over time.
Vesting
An index measuring the market’s expectation of volatility over the near term, often referred to as the “fear index.”
Volatility Index (VIX)
A measure of the degree of variation in the price of an asset over time.
Volatility
The number of shares or contracts traded for a security or an exchange during a given period.
Volume
The act of transferring property ownership willingly without compensation.
Voluntary Conveyance
A type of tax-free trust established to fund employee benefits.
Voluntary Employee Beneficiary Association (VEBA)
The right of a shareholder to vote on certain corporate matters.
Voting Right
