What are Deferred Acquisition Costs (DAC)? In the insurance industry, deferred acquisition costs are the accumulated costs of acquiring new insurance contracts and amortizing them over the duration of the contracts. The portion of unrecoverable costs from premium receipts is capitalized as intangible assets on the balance sheet. Amortizing over the contract term aligns with…
What is the S&P 500 Index? The Standard and Poor’s 500 Index, abbreviated as S&P 500 index, is an index comprising the stocks of 500 publicly traded companies in the U.S. with the highest values of market capitalization. Market capitalization, or market cap, is the product of the number of outstanding shares of a company…
What is an Electronic Check? An electronic check is an electronic version of the conventional paper check. It is a form of online payment where money is withdrawn from one account and deposited into another account using the Automated Clearing House (ACH) network. Through an ACH merchant account, a business can collect payments for products…
What is Earmarking? Earmarking is the process of appropriating money aside for a specific purpose. The term is used in several contexts; for example, in congressional appropriations of taxpayer funds to individual practices like mental accounting. In the case of organizations, the term relates to how companies or governments budget spending. For individuals, earmarking can…
What is Deferred Compensation? Deferred compensation refers to that part of one’s contribution that is withheld and paid at a future date. Retirement plans and employee pensions are examples of deferred compensation. Employers usually withhold a fraction of employees’ compensation every month, accumulate it over time, and pay the lump sum amount on a date…
What is Direct Marketing? Direct marketing is a method of advertising wherein the aim is to use a specific tool in order to achieve given advertisement related action in a predetermined group of consumers. It uses information such as store visits or website visits made by consumers, which can be correlated to a direct response…
What was the Dutch Tulip Bulb Market Bubble? The Dutch tulip bulb market bubble (or tulip mania) was a period in the Dutch Golden Age during which contract prices for some of the tulip bulbs reached extraordinarily high levels and then dramatically collapsed in February 1637; the rarest tulip bulbs traded for as much as…
What is a Share Class? A share class or share classes are usually created from various types of shares in a company. The type of shares and share classes that a company can create is determined and guided by its articles of association, also referred to as articles of incorporation. Shares classes that are created…
What is a Head Trader? A head trader refers to either the head of an independent trading company or the head of the trading department at a registered securities firm or other financial institution that conducts trading in the financial markets. Job Responsibilities of a Head Trader 1. Ensure regulatory compliance with local, state, and…
What is the Standard of Living? The standard of living is a term used to describe the level of income, necessities, luxury, and other goods and services that are generally readily available to a designated population. It is basically a metric that evaluates the amount of material goods that are produced and sold within a…
