What is Prime Brokerage? Prime brokerage is a set of services offered by investment banks and other large financial institutions to hedge funds and other investment clients. The clients need such services when borrowing securities or cash for the purpose of netting to allow a specific asset to achieve a higher return. What is Netting?…
What is a Repurchase Agreement (Repo)? A repurchase agreement (“repo”), also known as a sale-and-repurchase agreement, is an agreement involving the sale and subsequent repossession of the same security at a future date at a higher price. In simple terms, it is an exchange of a security (which acts as collateral) for cash. Repurchase agreements…
What is Interest? Interest refers to the cost of borrowing money or the reward for lending money. Typically, banks charge interest on money borrowed on top of the expected repayment of the principal. At the same time, banks also pay interest on depositors’ funds in savings and investment accounts. They do so to entice more…
What is a Jumbo Loan? A jumbo loan is a mortgage used to finance high-valued properties that are above the Federal Housing Finance Agency (FHFA) conforming loan limits. Jumbo loans are also known as non-conforming loans since they exceed the conventional local conforming loan limits as determined by the FHFA enterprises, Fannie Mae and Freddie…
What is a Business Tax Deduction? A business or corporate tax deduction refers to an item that is subtracted from revenue in order to determine a company’s taxable income. Tax deductions are considered a form of tax relief for the company. Companies will file their appropriate tax returns at least annually. These returns will show…
What is the Elliott Wave Theory? The Elliott Wave Theory is a technical analysis technique developed by American accountant and author Ralph Nelson Elliott in the 1930s. Elliott studied several years of stock market data across various indices and was the first to predict a stock market bottom in 1935. Since then, the theory’s become…
What is the Financial Sector? Key Roles and Institutions The financial sector refers to the businesses and institutions that manage money and provide intermediary services to transfer and allocate financial capital in an economy. Understanding the Financial Sector Every business expansion, home purchase, and investment depends on a financial regulatory framework that moves money efficiently….
What is Domain Knowledge (Data Science)? In data science, the term domain knowledge is used to refer to the general background knowledge of the field or environment to which the methods of data science are being applied. Data science, as a discipline, can be thought of as the study of tools used to model data,…
Who was John Maynard Keynes? John Maynard Keynes (1883-1946) was an English economist who was the founder of Keynesian economics. His father, John Neville Keynes, was also an economist and a lecturer at King’s College, Cambridge. His mother was a social reformer who was one of the first female graduates of King’s College Born in…
What is Hazard Insurance? Hazard insurance is a type of insurance coverage that is a part of homeowners insurance. It offers protection for damages incurred on your property as a result of natural or man-made disasters, which include fires, storms, lightning, or other hazards. Getting hazard insurance coverage means that you are covered for financial…
