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Financial Terms beginning with R

R Squared
R
RBC Consumer Attitudes And Spending By Household Index (RBC CASH Index)
RSI Relative Strength Index
RSI (Under Review)
Rabbi Trust
In the United States, a Rabbi trust is a type of trust used by businesses or other entities to defer the taxability to the person or entity receiving such payments as employee compensation or purchase payments in the acquisition of another business.
Racketeering
A racket is a service that is fraudulently offered to solve a problem, such as for a problem that does not exist, that will not be put into effect, or that would not otherwise exist if the racket did not exist. Conducting a racket is racketeering. Particularly, the potential problem may be caused by the same party that offers to solve it, although that fact may be concealed, with the specific intent to engender continual patronage for this party. The most common example of a racket is the "protection racket." The racket itself promises to protect the target business or person from dangerous individuals in the neighborhood; then either collects their money or causes the damages to the business until the owner pays. The racket exists as both the problem and its solution and is used as a method of extortion.
Radner Equilibrium
Radner equilibrium is an economic concept defined by economist Roy Radner in the context of general equilibrium. The concept is an extension of the Arrow–Debreu equilibrium and the base for the first consistent incomplete markets framework.
Rafael Miranda Robredo
Ragnar Frisch
Ragnar Anton Kittil Frisch was a Norwegian economist and the co-recipient of the first Nobel Memorial Prize in Economic Sciences in 1969. He is known for having founded the discipline of econometrics, and for coining the widely used term pair macroeconomics/microeconomics in 1933.
Raider
Rain Check
Rainbow Option
Rainbow option is a derivative exposed to two or more sources of uncertainty, as opposed to a simple option that is exposed to one source of uncertainty, such as the price of underlying asset.
Rainmaker
Raintaker
Rally
Ralph Wanger
Ramani Ayer
Ramani Ayer is an Indian-American business executive, and the former CEO and chairman of The Hartford.
Ramp Up
Ramp up is a term used in economics and business to describe an increase in firm production ahead of anticipated increases in product demand. Alternatively, ramp up describes the period from completed initial product development to maximum capacity utilization, characterized by product and process experimentation and improvements.
Random Factor Analysis
Random Variable
In probability and statistics, a random variable, random quantity, aleatory variable, or stochastic variable is a variable quantity whose value depends on possible outcomes. As a function, a random variable is required to be measurable, which rules out certain pathological cases where the quantity which the random variable returns is infinitely sensitive to small changes in the outcome.
Random Walk Theory
A random walk is a mathematical object, known as a stochastic or random process, that describes a path that consists of a succession of random steps on some mathematical space such as the integers. For example, the path traced by a molecule as it travels in a liquid or a gas, the search path of a foraging animal, the price of a fluctuating stock and the financial status of a gambler can all be approximated by random walk models, even though they may not be truly random in reality. As illustrated by those examples, random walks have applications to many scientific fields including ecology, psychology, computer science, physics, chemistry, biology as well as economics. Random walks explain the observed behaviors of many processes in these fields, and thus serve as a fundamental model for the recorded stochastic activity. As a more mathematical application, the value of pi can be approximated by the usage of random walk in agent-based modelling environment.
Range Accrual
In finance, a range accrual is a type of derivative product very popular among structured-note investors. It is estimated that more than US$160 billion of Range Accrual indexed on interest rates only have been sold to investors between 2004 and 2007. It is one of the most popular non-vanilla financial derivatives. In essence the investor in a range accrual is betting that the reference "index" - usually interest rates or currency exchange rates - will stay within a predefined range.
Range Bound Trading
Range Forward Contract
Range
Ras Al Khaimah Investment Authority (RAKIA)
Ratable Accrual Method
Rate And Term Refinance
Rate Anticipation Swap
Rate Improvement Mortgage
Rate Level Risk
Rate Of Adoption
Rate Of Change
Rate Of Return Regulation
Rate-of-return regulation is a system for setting the prices charged by government-regulated monopolies. The main premise is that monopolies will be compelled to charge the same price that would ideally prevail in a perfectly competitive market, which is equal to the efficient costs of production plus a market-determined rate of return on capital.
Rate Of Return
In finance, return is a profit on an investment. It comprises any change in value and interest or dividends or other such cash flows which the investor receives from the investment. It may be measured either in absolute terms or as a percentage of the amount invested. The latter is also called the holding period return.
Rate Trigger
Rating
Ratings Service
Ratio Analysis
Ratio Call Write
Ratio Spread
A Ratio spread is a complex, multileg options position that is a variation of a vertical spread. Like a vertical, the ratio spread involves buying and selling options on the same underlying security with different strike prices and the same expiration date. Unlike a vertical spread, a number of option contracts sold is not equal to a number of contracts bought. An unequal number of options contracts gives this spread certain unique properties compared to a regular vertical spread. A typical ratio spread would be where twice as much option contracts are sold, thus forming a 1:2 ratio.
Rational Behavior
Rational Choice Theory
Rational choice theory, also known as choice theory or rational action theory, is a framework for understanding and often formally modeling social and economic behavior. The basic premise of rational choice theory is that aggregate social behavior results from the behavior of individual actors, each of whom is making their individual decisions. The theory therefore focuses on the determinants of the individual choices.
Rational Expectations Theory
In economics, "rational expectations" are model-consistent expectations, in that agents inside the model on average assume the model's predictions are valid. Rational expectations ensure internal consistency in aggregate stochastic models. To obtain consistency within a model, the predictions of the future value of economically relevant variables are optimal given the decision-makers' information set and model structure. The rational expectations assumption is used especially in many contemporary macroeconomic models. Rational expectations does not imply individual rationality and should not be confused with rational choice theory, which is used extensively in, among others, game theory.
Rational Pricing
Rational pricing is the assumption in financial economics that asset prices will reflect the arbitrage-free price of the asset as any deviation from this price will be "arbitraged away". This assumption is useful in pricing fixed income securities, particularly bonds, and is fundamental to the pricing of derivative instruments.
Rationalization
Rationing
Rationing is the controlled distribution of scarce resources, goods, or services, or an artificial restriction of demand. Rationing controls the size of the ration, which is one's allowed portion of the resources being distributed on a particular day or at a particular time.
Raw Materials
A raw material, also known as a feedstock or most correctly unprocessed material, is a basic material that is used to produce goods, finished products, energy, or intermediate materials which are feedstock for future finished products. As feedstock, the term connotes these materials are bottleneck assets and are highly important with regards to producing other products. An example of this is crude oil, which is a raw material and a feedstock used in the production of industrial chemicals, fuels, plastics, and pharmaceutical goods; lumber is a raw material used to produce a variety of products including furniture.
Razor Razorblade Model
Raúl Alarcón Jr.
Re Offer Price
Reaction
Reaffirmation
Reaganomics
Reaganomics refers to the economic policies promoted by U.S. President Ronald Reagan during the 1980s. These policies are commonly associated with supply-side economics, referred to as trickle-down economics or voodoo economics by political opponents, and free-market economics by political advocates.
Real Asset
Real Bills Doctrine
The real bills doctrine asserts that money should be issued in exchange for short-term real bills of adequate value. The doctrine was developed by practical bankers over centuries of experience, as a means for banks to stay solvent and profitable. Banks that follow it avoid inflation, maturity mismatching, and speculative bubbles and unwanted reflux of money.
Real Body
Real Economic Growth Rate
Real Effective Exchange Rate (REER)
Real Estate Agent
A real estate broker or real estate salesperson is a person who acts as an intermediary between sellers and buyers of real estate/real property and attempts to match up sellers who wish to sell and buyers who wish to buy.
Real Estate Investment Group
Real estate investment clubs are clubs formed by individuals who want to invest specifically in real estate.
Real Estate Investment Trust (REIT)
Real Estate Investment Trust or REIT
Real Estate Limited Partnership (RELP)
Real Estate Mortgage Investment Conduit (REMIC)
Real Estate Mortgage Investment Conduits (REMIC)
Real Estate Operating Company (REOC)
Real Estate Owned (REO)
Real Estate Settlement Procedures Act (RESPA)
Real Estate Short Sale
Real Estate
Real estate is "property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this an item of real property; buildings or housing in general. Also: the business of real estate; the profession of buying, selling, or renting land, buildings or housing."
Real Gross Domestic Product (GDP)
Real Income
Real income is income of individuals or nations after adjusting for inflation. It is calculated by subtracting inflation from the nominal income. Real variables, such as real income, real GDP, and real interest rate are variables that are measured in physical units, while nominal variables such as nominal income, nominal GDP, and nominal interest rate are measured in monetary units. Therefore, real income is a more useful of well-being since it is based on the amount of goods and services that can be purchased with the income.
Real Interest Rate
The real interest rate is the rate of interest an investor, saver or lender receives after allowing for inflation. It can be described more formally by the Fisher equation, which states that the real interest rate is approximately the nominal interest rate minus the inflation rate.
Real Option
Real Options Valuation, also often termed real options analysis, applies option valuation techniques to capital budgeting decisions. A real option itself, is the right — but not the obligation — to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project. For example, the opportunity to invest in the expansion of a firm's factory, or alternatively to sell the factory, is a real call or put option, respectively.
Real Property
In English common law, real property, real estate, realty, or immovable property is land which is the property of some person and all structures integrated with or affixed to the land, including crops, buildings, machinery, wells, dams, ponds, mines, canals, and roads, among other things. The term is historic, arising from the now-discontinued form of action, which distinguished between real property disputes and personal property disputes. Personal property was, and continues to be, all property that is not real property.
Real Rate Of Return
Real Time Gross Settlement (RTGS)
Real Time Quote
Real Time Trade Reporting
Real Time
Real Value
Realization Multiple
Realized Gain
Realized Loss
Realized Yield
Reallowance
Realtor
A real estate broker or real estate salesperson is a person who acts as an intermediary between sellers and buyers of real estate/real property and attempts to match up sellers who wish to sell and buyers who wish to buy.
Rebalancing
The rebalancing of investments is the action / trading strategy of bringing a portfolio that has deviated away from one's target asset allocation back into line. This can be implemented by transferring assets, that is, selling investments of an asset class that is overweight and using the money to buy investments in a class that is underweight, but it also applies to adding or removing money from a portfolio, that is, putting new money into an underweight class, or making withdrawals from an overweight class.
Recession
Resistance
Return on Assets ROA
Return on Assets (Under Review)
Return on Equity
Return on equity measures the rate of return for ownership interest of common stock owners. It measures the efficiency of a firm at generating profits from each unit of shareholder equity, also known as net assets or assets minus liabilities. ROE shows how well a company uses investments to generate earnings growth. ROEs 15-20% are generally considered good.
Return on Investment
Return on investment is the benefit to an investor resulting from an investment of some resource. A high ROI means the investment gains compare favorably to investment cost. As a performance measure, ROI is used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. In purely economic terms, it is one way of considering profits in relation to capital invested.
Revenue
Reverse Mortgage
A reverse mortgage or home equity conversion mortgage is a special type of home loan for older homeowners that requires no monthly mortgage payments. Borrowers are still responsible for property taxes and homeowner's insurance. Reverse mortgages allow elders to access the home equity they have built up in their homes now, and defer payment of the loan until they die, sell, or move out of the home. Because there are no required mortgage payments on a reverse mortgage, the interest is added to the loan balance each month. The rising loan balance can eventually grow to exceed the value of the home, particularly in times of declining home values or if the borrower continues to live in the home for many years. However, the borrower is generally not required to repay any additional loan balance in excess of the value of the home.
Risk Management
Risk management is the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities. Risk management's objective is to assure uncertainty does not deflect the endeavor from the business goals.
Risk Tolerance
In economics and finance, risk aversion is the behavior of humans, when exposed to uncertainty, to attempt to reduce that uncertainty. It is the reluctance of a person to accept a bargain with an uncertain payoff rather than another bargain with a more certain, but possibly lower, expected payoff. For example, a risk-averse investor might choose to put his or her money into a bank account with a low but guaranteed interest rate, rather than into a stock that may have high expected returns, but also involves a chance of losing value.
Risk
Roth IRA
A Roth IRA is a retirement plan under US law that is generally not taxed, provided certain conditions are met. The tax law of the United States allows a tax reduction on a limited amount of saving for retirement. The Roth IRA's principal difference from most other tax advantaged retirement plans is that, rather than granting a tax break for money placed into the plan, the tax break is granted on the money withdrawn from the plan during retirement.