Business / Taxes Glossary

Adjusted Gross Income (AGI): Your AGI is your gross, or total, income from taxable sources minus certain deductions. Income includes salary and other employment income, interest and dividends, and long- and short-term c . . . View Full Definition

Advance-Decline (A-D) Line: The advance-decline line graphs the ratio of stocks that have risen in value — the advancers — to stocks that have fallen in value — the decliners — over a particular trading period. The dir . . . View Full Definition

Advancer: Stocks that have gained, or increased, in value over a particular period are described as advancers. If more stocks advance than decline — or lose value — over the course of a trading day, t . . . View Full Definition

Affinity Fraud: Affinity fraud occurs when a dishonest person plays on your affiliation with a group — such as a house of worship, social club, support group, charity, or veterans’ group — as a way to win y . . . View Full Definition

After-Hours Market: Securities, such as stocks and bonds, may change hands on organized markets and exchanges after regular business hours, in what is known as the after-hours market. These electronic transacti . . . View Full Definition

After-Tax Contribution: An after-tax contribution, or excess deferral, is money you put into your 401(k) or other employer sponsored retirement savings plan in addition to your pretax contribution. You might make a . . . View Full Definition

After-Tax Income: After-tax income, sometimes called post-tax dollars, is the amount of income you have left after federal income taxes (plus state and local income taxes, if they apply) have been withheld. I . . . View Full Definition

Agency Bond: Some federal agencies, including Ginnie Mae (GNMA) and the Tennessee Valley Authority (TVA), raise money by issuing bonds and short-term discount notes for sale to investors. The money raise . . . View Full Definition

Agent: An agent is a person who acts on behalf of another person or institution in a transaction. For example, when you direct your stockbroker to buy or sell shares in your account, he or she is a . . . View Full Definition

Aggressive-Growth Fund: Aggressive-growth mutual funds buy stock in companies that show rapid growth potential, including start-up companies and those in hot sectors. While these funds and the companies they invest . . . View Full Definition

All Or None Order (AON): When a trading order is marked AON, the broker who is handling the order must either fill the whole order or not fill it at all. For example, if you want to buy 1,500 shares at $20 a share a . . . View Full Definition

Alpha: A stock's alpha is an analyst's estimate of its potential price increase based on the rate at which the company's earnings are growing and other aspects of the company's current performance. . . . View Full Definition

Alternative Minimum Tax (AMT): The alternative minimum tax (AMT) was designed to ensure that all taxpayers pay at least the minimum federal income tax for their income level, no matter how many deductions or credits they . . . View Full Definition

American Association Of Individual Investors (AAII): The goal of this independent, nonprofit organization is teaching individual investors how to manage their assets effectively. Headquartered in Chicago, the AAII offers publications, seminars . . . View Full Definition

American Depositary Receipt (ADR): Shares of hundreds of major overseas-based companies, including names such as British Petroleum, Sony, and Toyota, are traded as ADRs on US stock markets in US dollars. ADRs are actually rec . . . View Full Definition

American Depositary Share (ADS): When a company based overseas wants to sell its shares in the US markets, it can offer them through a US bank, which is known as the depositary. The depositary bank holds the issuing company . . . View Full Definition

American Stock Exchange (AMEX): The AMEX is the second-largest floor-based stock exchange in the US after the New York Stock Exchange (NYSE). It operates an auction market in stocks (including overseas stocks), exchange tr . . . View Full Definition

American-Style Option: A listed option that you can exercise at any point between the day you purchase it and its expiration date is called an American style option. All equity options are American style, no matte . . . View Full Definition

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