Investment Terms

Earnings before interest, taxes, depreciation, and amortisation measure a company’s overall financial performance and are used as an alternative to the net income in some circumstances.
EBITDA, however, can be misleading because it strips out the cost of capital investments like property, plants, and equipment.
This metric also excludes expenses associated with debt by adding back interest expenses and taxes to earnings however it is a more precise measure of corporate performance since it is able to show earnings before the influence of accounting and financial deductions.
The U.S. generally accepted accounting principles because there is no legal requirement for companies to disclose their EBITDA however it can be worked out and reported using the information found in a company’s financial statements.

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A war bond is a debt security issued by a government to finance military operations during times of war or conflict.
War bonds offered a rate of return below the market rate therefore investment is achieved by making emotional appeals to patriotic citizens to lend the government money.
A war bond is a debt instrument issued by a government as a means of borrowing money to finance its defense initiatives and military efforts during times of war.
Besides the United States government, other countries including Canada, Germany, the United Kingdom, and Austria-Hungary also issued war bonds

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An individual retirement account is a savings account with tax advantages that individuals can open to save and invest in the long term.
An IRA is designed to encourage people to save for retirement. Anyone who has earned income can open an IRA and enjoy the tax benefits these accounts offer.
You can open an IRA through a bank, an investment company, an online brokerage, or a personal broker. IRAs are retirement savings accounts with tax advantages.
Money held in an IRA usually can't be withdrawn before age 59½ without incurring a hefty tax penalty of 10% of the amount withdrawn.
There are annual income limitations for deducting contributions to traditional IRAs and for contributing to Roth IRAs.

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A waiver of subrogation is a contractual provision whereby an insured waives the right of their insurance carrier to seek redress or seek compensation for losses from a negligent third party.
Insurers charge an additional fee for a waiver of subrogation endorsement. Many construction contracts and leases include a waiver of the subrogation clause.
Such provisions prevent one party’s insurance carrier from pursuing a claim against the other contractual party in an attempt to recover money paid by the insurance company to the insured or to a third party to resolve a covered claim.
A right of subrogation allows an insurer to stand in proxy for its insured after satisfying a claim paid to the insured per the company’s duties under the insurance policy.

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An investment fund is a supply of capital belonging to numerous investors used to collectively purchase securities while each investor retains ownership and control of his own shares.
An investment fund provides a broader selection of investment opportunities, greater management expertise, and lower investment fees than investors might be able to obtain on their own.
Types of investment funds include mutual funds, exchange-traded funds, money market funds, and hedge funds.
Individual investors do not make decisions about how a fund's assets should be invested but they simply choose a fund based on its goals, risk, fees and other factors.
An investment fund can be broad-based, such as an index fund that tracks the S&P 500, or it can be tightly focused, such as an ETF that invests only in small technology stocks.

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Equity referred to as shareholders' equity or owners' equity for privately held companies represents the amount of money that would be returned to a company's shareholders if all of the assets were liquidated and all of the company's debt was paid off in the case of liquidation.
Shareholder equity can represent the book value of a company. Equity can sometimes be offered as payment-in-kind. It also represents the pro-rata ownership of a company's shares.
Equity is used as capital raised by a company, which is then used to purchase assets, invest in projects, and fund operations.
Investors usually seek out equity investments as it provides a greater opportunity to share in the profits and growth of a firm.

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Economic growth is an increase in the production of economic goods and services, compared from one period of time to another. It can be measured in nominal or real terms.
Aggregate economic growth is measured in terms of gross national product or gross domestic product although alternative metrics are sometimes used.
Aggregate gains in production correlate with increased average marginal productivity which leads to an increase in incomes, inspiring consumers to open up their wallets and buy more, which means a higher material quality of life or standard of living.
In economics, growth is commonly modelled as a function of physical capital, human capital, labour force, and technology.

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Opportunity costs represent the potential benefits that an individual, investor, or business misses out on when choosing one alternative over another.
opportunity costs are unseen by definition, they can be easily overlooked. Understanding the potential missed opportunities when a business or individual chooses one investment over another allows for better decision-making.
Opportunity cost is the forgone benefit that would have been derived from an option not chosen.
To properly evaluate opportunity costs, the costs and benefits of every option available must be considered and weighed against the others.
Considering the value of opportunity costs can guide individuals and organizations to more profitable decision-making.

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A hard landing refers to a marked Economic_slowdown or downturn following a period of rapid growth.
The term hard landing comes from aviation, where it refers to the kind of high-speed landing that—while not an actual crash—is a source of stress as well as potential damage and injury.
The metaphor is used for high-flying economies that run into a sudden, sharp check on their growth, such as a monetary policy intervention meant to curb inflation. Economies that experience a hard landing often slip into a stagnant period or even recession.
This results in a hard landing where slowing down or stopping expansionary macroeconomic policy can precipitate a stock market crash, financial crisis, or a collapse of investor confidence.
These events can spiral into a general recession too quickly for policy makers to mount an effective defence due to recognition, response, and implementation lags in macroeconomic policy.
The term hard landing has often been applied to China, which has enjoyed decades of preternaturally high gross domestic product growth rates that have set it up for a hard landing.

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A soft landing, in economics, is a cyclical downturn that avoids recession.
It describes attempts by the central banks to raise interest rates just enough to stop an economy from overheating and experiencing high inflation, without causing a significant increase in unemployment, or a hard landing.
It may also refer to a sector of the economy that is expected to slow down without crashing.
Governments and central banks often attempt soft landings by fine-tuning fiscal or monetary policy.
The concept was conceived by Alan Greenspan, former chair of the Federal Reserve, who engineered the only true soft landing in U.S. history from 1994 to 1995 when the Fed raised interest rates enough to slow the economy, but not enough to cause an economic contraction.
Soft-landings are met with skepticism but some economists say it amounts to little more than economic mumbo-jumbo.

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