Definitions Starting with "S"

S&P 500 Index

The S&P 500 Index is a diverse index that includes 500 American companies that represent over 70% of the total market capitalization of the U. S. Read more

S&P 600 Small Cap Index

The S&P Small-Cap 600 Index consists of 600 small-cap stocks.   A small-cap company is generally defined as a stock with a market capitalization between $300 million and $2 billion. Read more

S&P Europe 350 Index

The S&P Europe 350 index is made up of 350 individual European company stocks drawn from 17 major European markets and represents approximately 70% of the region's market capitalization. The S&P Europe 350 index is comprised of the S&P Euro, the S&P Euro Plus, and the S&P United Kingdom. Read more

S&P Frontier Broad Market Index

The S&P Frontier Broad Market Index (also known as the S&P Frontier BMI) measures the performance of markets in 34 small countries. The individual country indices that make up the S&P Frontier BMI include all publicly-listed equities that make up more than 80% of the market capitalization available in each market. Read more

S&P Global 1200 Index

The S&P Global 1200 index is comprised of seven indices with stocks from 29 representative countries. The index is used as a benchmark for global equity markets. Read more

S&P Global Broad Market Index

The S&P Global Broad Market Index (also known as the S&P Global BMI) is a widely encompassing, rules-based index that measures global stock market performance. The S&P Global BMI covers approximately 11,000 companies from 46 countries and is converted daily into seven different currency amounts: USD, Euro, GBP, JPY, AUD, CAD and LCL. Read more

S&P Global Equity Index Series

The S&P Global Equity Index series is comprised of three indices: The S&P Frontier Broad Market Index, The S&P Global Broad Market Index and the S&P/IFCI. The S&P Global Equity Index series is designed to include the most liquid and investable stocks in emerging, frontier and developed markets. Read more

S&P Mid-Cap 400 Index

The S&P Mid-Cap 400 Index tracks a diverse basket of medium-sized U. S. Read more

S&P/IFCI Composite

The S&P/IFCI Composite is a liquid and investable leading emerging market index. It is a subset of the S&P Emerging Plus Broad Market Index, with the addition of South Korea. Read more

Sacrifice Ratio

A sacrifice ratio measures the costs of lower economic production as a percentage of the change in inflation. The formula for the sacrifice ratio is: Sacrifice Ratio = Dollar Cost of Production Losses/Percentage Change in Inflation Let's say the economy is slowing and factory output has slowed down as a result. Read more

Safe Asset

A safe asset (usually a physical asset rather than a security) carries a low degree of liability for its owner. In more technical financial terms, safe assets are similar to cash -- they carry little risk of loss (or gain). Read more

Safe Deposit Box

A safe deposit box is a metal box, usually housed in a bank vault, that customers can rent in order to keep valuables, legal documents and other prized possessions in a secure location.   Obtaining a safe deposit box is usually as simple as going to a local bank and asking for one. Read more


Safekeeping is a term describing a financial institution's responsibility to keep clients' assets in a safe area. Let's say John Doe deposits $4,000 into his savings account at Bank XYZ. Read more

Safekeeping Certificate

A safekeeping certificate is a document that proves that a person owns a security or a certificate of deposit (CD). An American Depository Receipt (ADR) is one of the most common forms of safekeeping certificates. Read more

Safety-First Rule

The safety-first rule, also called Roy's safety-first rule, is a measure of the minimum returns an investor requires from a portfolio. The formula for the safety-first rule is: Safety-First Rule = (Expected return for portfolio – Threshold return for portfolio)/Standard deviation of portfolio   The mechanics of the formula are simple: Input the investor's minimum required return, the expected return for the portfolio, and the standard deviation for the portfolio. Read more


A saitori is a member of the Tokyo Stock Exchange who matches buy and sell orders. Saitori are similar to specialists in the New York Stock Exchange. Read more

Salad Oil Scandal

The Salad Oil Scandal of 1963 was a case of corporate fraud perpetrated by the Allied Crude Vegetable Oil Company, which resulted in serious losses for major banks acting as its creditors. Banks for the Allied Crude Vegetable Oil Company granted it a substantial line of credit demanding its vegetable oil inventory as collateral. Read more

Salary Freeze

A salary freeze is a temporary cessation of pay raises. For example, Company XYZ makes widgets. Read more


A sale is the transfer of title to a piece of property or performance of a service in return for compensation. In the retail world, a sale means a temporary price discount on certain items. Read more

Sale of Crown Jewels

In the business world, a sale of crown jewels occurs when a company is frantically attempting to fend off a takeover. For example, Company ABC makes a bid to buy Company XYZ. Read more

Sales Charge

Also called commission or a load, a sales charge is a fee paid to purchase or sell a specific investment. It is expressed as a percentage of the amount invested. Read more

Sales Lead

A sales lead is a prospective customer or information about a prospective customer. For example, Company XYZ sells widgets. Read more

Sales per Share

The term sales per share represents the portion of a company's revenue that is allocated to each share of common stock. The figure can be calculated simply by dividing sales earned in a given reporting period (usually quarterly or annually) by the total number of shares outstanding during the same term. Read more

Sales per Square Foot

Sales per square foot is an indicator of sales efficiency. The formula for it is: Sales Per Square Foot = Sales / Square Feet of Selling Space For example, let's say Company XYZ sold $15 million worth of clothes last year in its 10 stores. Read more

Sales Tax

Sales tax is a consumption tax levied on goods and services purchased at the retail level, paid by the consumer and submitted by the retailer to the governing tax authority. In the United States, the sales tax is imposed on retail items. Read more

Sales to Cash Flow Ratio

The sales to cash flow ratio measures the level of a company's sales against its total cash flow. Expressed on a per-share basis, the sales to cash flow ratio is calculated by dividing a company's sales volume per share in a given period by its per-share cash flow. Read more

Sallie Mae (SLM)

Sallie Mae, also known as The Student Loan Marketing Association (SLM), is the largest originator, funder and servicer of student loans in the United States. It also provides counseling about student loans to students as well as their parents. Read more

Salvage Value

Salvage value, also called scrap value, is the value of an asset after it has come to the end of its useful life. For example, let's assume you buy a car for $20,000. Read more

Same Property Rule

The same property rule is an IRS rule stating that money taken from an Individual Retirement Account must be placed into a similar type of account if the account holder is less than 59. 5 years old. Read more

Same-Day Funds

Same-day funds can be deposited and then withdrawn on the same day. Let's say John Doe gets paid every other Friday. Read more

Same-Day Substitution

Same-day substitution is the act of withdrawing money from and adding money to a margin account on the same day.   Let's assume you want to buy 500 shares of Company XYZ for $5 per share and 500 shares of Company ABC for $5 per share but don't have the $5,000 necessary to do so -- you only have $2,500. Read more

Same-Store Sales

Same-store sales measures the increase in revenue over a particular period for the same set of stores in each period. For example, let's assume that Company XYZ is a restaurant company that has 45 restaurants. Read more

Samurai Bond

Samurai bonds are corporate bonds issued in Japan by a non-Japanese company.  Samurai bonds are yen-denominated bonds issue in Japan by a foreign company. Read more

Samurai Market

Samurai Market is slang that refers to the Japanese stock market. People in the United States are the most common users of this term. Read more


Sandbag is slang for lowering expectations. Let's say John Doe is a new employee at Company XYZ. Read more

Santa Claus Rally

A Santa Claus rally is a surge in the stock market that occurs between Christmas and New year's Day.  Over time, the stock markets have rallied between December 25th and January 1st more often than they have not. Read more

Sarbanes-Oxley Act (SOX)

The Sarbanes-Oxley Act, officially named the Public Company Accounting Reform and Investor Protection Act of 2002, became law on July 30, 2002. The law was informally named after its sponsors, Senator Paul Sarbanes (D-MD) and Representative Michael G. Read more

Saturday Night Special

Saturday night specials are illegal rules that give preferential treatment to some shareholders and pressure others during tender offers. Let's assume Company XYZ wants to purchase the common shares of Company 123. Read more

Saver's Tax Credit

The saver's tax credit, also called the savers credit, is a tax credit for making contributions to certain retirement accounts.   The savers credit gives taxpayers a tax credit of up to $1,000 ($2,000 if filing jointly) for contributions to IRAs, 401(k)s and certain other retirement plans. Read more


In economics, savings is the amount that is left after spending. In banking, savings refers to savings accounts, which are short-term, interest-bearing deposits with a bank or other financial institution. Read more

Savings Account

A savings account is a low-risk, interest-bearing deposit with a bank or other financial institution. Technically, savings accounts are time deposits, meaning that a bank can require the account holder to give notice before withdrawing the funds or impose a penalty for withdrawal before a specified date. Read more

Savings Bonds

Savings bonds are bonds sold by the U. S. Read more

Savings Club

Savings clubs most commonly refer to a special type of account that provides a way to regularly save for a specific goal or event. These accounts historically came with a savings passbook with coupons which helped make the act of saving more convenient and automatic. Read more

Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)

The Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) is a salary savings plan that small companies can offer their employees. The plan allows employers to match their employees' annual contributions or to infuse a smaller mandatory amount in the absence of employee contributions. Read more


Scalability refers to a company's ability to increase its production profitably. Let's assume it costs Company XYZ $1 million to produce 1 million widgets per year ($1 per widget). Read more

Scale Order

A scale order is a group of limit orders that have increasing or decreasing prices. Let's say John Doe thinks the price of Company XYZ will fall during the trading day tomorrow, and not all at once. Read more


The term scalpers refers to securities traders who manipulate the market.   Scalpers may also refer to traders who earn relatively small amounts of money from the arbitrage between bid prices and ask prices on securities. Read more


Scalping is a form of day trading that involves earning small profits on large volumes of securities. A day trader is a very active securities trader who holds securities for a very short time (generally one day or less). Read more

Schedule 13-D

A beneficial ownership report, known as SEC Schedule 13-D, is a public notice of anyone who has acquired 5% or more of a voting class of a company's equity securities. For example, let's say you really like Company XYZ stock. Read more

Schedule K-1

An Internal Revenue Service (IRS) Schedule K-1 is used to report a beneficiary's share of income, deductions, credits, and other items from pass-through entities. These generally include limited partnerships, S Corporations, income trusts, and limited liability companies. Read more

Scrap Value

Scrap value, also called salvage value, is the value of an asset after it has come to the end of its useful life. Let's assume you buy a car for $20,000. Read more

Seasonal Industry

A seasonal industry is an industry whose sales or profits fluctuate in repeatable patterns during the course of the year. For example, the restaurant industry is a seasonal industry. Read more


Seasonality is a fluctuation in sales or profits during the course of a fiscal year. For example, the restaurant industry is somewhat seasonal. Read more

Seasoned Issue

A seasoned issue, also called follow-on offering or secondary offering, is a sale of stock by a company or by an existing shareholder of a company that is already publicly held. Let's say Company XYZ is a public company and would like to sell additional shares in order to raise money to build a new factory. Read more


A seat is a license to trade on the floor of the New York Stock Exchange, either as an agent for someone else or for his or her own personal accounts (in which case, the person is called a floor trader).   The New York Stock Exchange (NYSE, also known as the Big Board) is the first and most popular stock exchange in the world. Read more

SEC Form 10-Q

SEC Form 10-Q is a quarterly performance report that public companies must submit to the SEC. The 10-Q is just one of many forms a company that is publicly traded in the U. Read more

SEC Form 11-K

An SEC Form 11-K is an annual report that is filed with the Securities and Exchange Commission (SEC) for employee stock purchase plans and similar savings plans that constitute securities registered under the Securities Act of 1933. A Form 11-K requires the following: Audited financial statements for the past two fiscal years Audited statement of income and changes in plan equity for each of the latest three fiscal years of the plan Companies aren't the only organizations that must file annual reports with the SEC. Read more


SEC Form BD is an application with the Securities and Exchange Commission (SEC) to register as a broker-dealer. A Form BD makes public the information about any broker-dealer that wishes to trade securities. Read more

Second Mortgage

Also called a home equity loan, a second mortgage is secured by the equity in a house. Equity equals the value of the house less the balance owed on the homeowner's mortgage. Read more

Second-to-Die Insurance

Second-to-die insurance is a type of life insurance which grants a death benefit only once the second insured party has died. Also called survivorship insurance, second-to-die insurance is a life insurance policy which covers the lives of two individuals, usually married couples. Read more

Secondary Currency

Also called quote currency or counter currency, a secondary currency is the currency in a currency pair. Major pairs are the four pairs of currencies that are most commonly traded in the foreign exchange markets. Read more

Secondary Offering

A secondary offering refers to a large-scale market sale of a company's shares by a major shareholder. Also called a secondary distribution, a secondary offering is distinguished from an initial public offering (or IPO) in that the proceeds generated by the sale of the shares goes to the shareholder rather than the issuing company. Read more

Sector Rotation

Sector rotation is a strategy based on moving investments across business sectors to take advantage of cyclical trends in the overall economy. The basic idea behind sector rotation is that the economy operates in cycles. Read more

Secular Market

A secular market is a market that is for all intents and purposes captive to broader economic forces or traumas.   Let's say the United States experiences a massive terror attack on its own soil, similar to September 11, 2001. Read more

Secured Creditor

Secured creditor is a lender that provides collateralized debt. Mortgage lenders are the most common example of secured creditors: They lend you money and keep the house as collateral. Read more

Secured Debt

Secured debt is debt that is collateralized. Mortgages are the most common example of secured debt: the bank lends you the money and the bank has the house as collateral. Read more

Securities Act of 1933

The Securities Act of 1933 was the first law passed that imposed regulations on the securities industry following the stock market crash of 1929. The stock market crash of 1929 resulted from more than a decade of unsavory and imprudent business and investment practices. Read more

Securities Analyst

A securities analyst gathers and interprets data about securities, companies, corporate strategies, economies or financial markets. Securities analysts are sometimes called financial analysts, equity analysts or investment analysts (although there is a distinction among these titles). Read more

Securities and Exchange Commission (SEC)

The Securities and Exchange Commission, also known as the SEC, is a regulatory body that was established as a result of the Securities Act of 1934. Founded after the stock market crash of 1929, the SEC is the federal agency responsible for the oversight and enforcement of laws pertaining to the securities industry. Read more

Securities Investor Protection Corporation (SIPC)

The Securities Investor Protection Corporation (SIPC) is a nonprofit corporation created to insure the assets investors have deposited in brokerage firms. All registered brokers, dealers, members of securities exchanges, and the majority of Financial Industry Regulatory Agency (FINRA) members belong to the SIPC. Read more

Seed Capital

Seed capital is the earliest stage of capital investment for a start-up venture. Startup financing involves several stages of capital formation:  seed capital, venture capital, mezzanine or bridge funding, and an initial public offering. Read more


Self-dealing is an illegal activity that occurs when a person or entity with fiduciary duty puts his or her own  interests ahead of a client's interests in a transaction. Let's say John Doe owns 500,000 shares of Company XYZ. Read more

Self-Employment Tax

The self-employment tax refers to the Social Security and Medicare taxes paid on income earned by people who work for themselves. People who are self-employed must pay both the employee and employer portion of the Federal Insurance Contributions Act (FICA) tax (a total of 12. Read more


To self-insure means to use one's own money to pay for unexpected losses (rather than insurance). Let's say John Doe owns a restaurant. Read more

Sell Side

Sell side, sometimes called prime brokers, refers to investment firms which sell securities and assets to money management firms and corporate entities. They may be considered intermediaries which both perform research and conduct the actual purchase of securities. Read more


A sell-off is the rapid selling of a security leading to a sharp decline in its price.  When a substantial number of shareholders sell a specific stock, it is called a sell-off. Read more

Seller's Market

A seller's market exists when there are more sellers than buyers in the market for a certain good or service. Housing is a common place to find a seller's market. Read more

Semi-Variable Cost

A semi-variable cost has characteristics of both fixed costs and variable costs once a specific level of output is surpassed. Semi-variable costs remain fixed up to a particular production volume. Read more

Senior Debt

Senior debt is debt that is first to be repaid, ahead of all other lenders or creditors, in the event of a borrower’s bankruptcy. For example, if Company XYZ issues bonds, the bondholders are creditors who are senior to Company XYZ's shareholders, for example. Read more

Separate Trading of Registered Interest and Principal of Securities (STRIPS)

STRIPS stands for Separate Trading of Registered Interest and Principal of Securities. They are securities that represent the separate interest and principal components of Treasuries. Read more

Serial Bonds

Serial bonds (or installment bonds) describes a bond issue that matures in portions over several different dates.   Instead of facing a large lump-sum principal re-payment at maturity, an issuer can opt to spread the principal repayment over several periods. Read more

Series 63

The Series 63 (formally known as the Uniform Securities Agent State Law Exam) primarily covers a specific state's laws and ethical standards. Some states require brokers to obtain this license before soliciting clients and taking orders. Read more

Series 65

Administered by the Financial Industry Regulatory Authority (FINRA) and designed by the North American Securities Administrators Association (NASAA), the Series 65 is an exam and professional license for individuals who wish to serve as investment advisors.   Formally named the Uniform Investment Adviser Law Examination, the Series 65 covers regulations, ethics, laws and professional practice subjects such as portfolio management, retirement planning, and fiduciary responsibilities. Read more

Series 7

Series 7 is a license that is required before an individual can sell securities. Those who pass the exam for a Series 7 license are eligible to become a registered representative of broker-dealers in the United States. Read more

Series 82

The Series 82 is an exam for individuals who want to be licensed to do primary offerings of private placements. The Financial Industry Regulatory Authority (FINRA) administers the Series 82 exam as mandated by the Gramm-Leach-Bliley Act of 1999. Read more

Settlement Price

Settlement price refers to the market price of a derivatives contract at the close of a trading day. Also called the closing price, the settlement price is the price at which a derivatives contract settles once a given trading day has ended. Read more

Settlement Risk

Settlement risk refers to the risk or probability that one party will not uphold their contractual obligation in a transaction or deal. Settlement risk is most often associated with currency trading. Read more

Severance Pay

Severance pay refers to a payment from a company to an employee who is being discharged.  Under certain circumstances, employers compensate an employee who is being discharged with a sum of money called severance pay. Read more

Shadow Banking System

The shadow banking system (or shadow financial system) is a network of financial institutions comprised of non-depository banks -- e. g. Read more

Shadow Open Market Committee (SOMC)

The Shadow Open Market Committee (SOMC) is a group of economists that provides critical analysis of Federal Open Market Committee (FOMC) decisions. Founded by two economists from Carnegie Mellon University and the University of Rochester, the Shadow Open Market Committee (SOMC) analyzes and critiques the monetary policy and decisions of the Federal Open Market Committee (FOMC). Read more

Shadow Pricing

Shadow pricing is the practice of allotting a dollar-value to an abstract commodity for the purpose of cost-benefit analysis. Cost-benefit analysis takes into account abstract commodities (also called intangible assets) not normally purchased or sold in a marketplace. Read more

Shanghai Composite Index (SHCOMP)

The Shanghai Composite Index tracks the biggest and most important public companies in China. The Shanghai Composite Index is similar to the Dow Jones Industrial Average (DJIA) in the U. Read more

Share Classes

Share classes refers to the division of a company's equity into different classes, which have different rights. Companies generally set forth the distinguishing features of their share classes in their corporate charter and bylaws. Read more

Share Purchase Right

A share purchase right is an instrument that entitles the holder to purchase a specified number of shares at a specified price. Offered by an issuing company, a share purchase right gives current shareholders the opportunity to purchase a specific quantity of shares at a favorable discount without obligation. Read more

Shareholder Value Added (SVA)

Shareholder value added (SVA) represents a company's worth to shareholders in the absence of liabilities and capital costs. Shareholder value added (SVA) is expressed as a company's capital costs from stock and bond issues subtracted from its net operating profit after tax (NOPAT). Read more

Shareholders Equity

Shareholders equity is a measure of how much of a company's net assets belong to the shareholders. Shareholders equity is found on the balance sheet. Read more

Shares Outstanding

Shares outstanding refers to all shares currently owned by stockholders, company officials, and investors in the public domain, but does not include shares repurchased by a company. Shares outstanding is also referred to as outstanding shares, or issued shares. Read more

Sharpe Ratio

The Sharpe ratio is measure of risk. It is named after Stanford professor and Nobel laureate William F. Read more

Shelf Offering

A shelf offering is a sale of stock by a company over time. Let's say Company XYZ is a public company and would like to sell shares in order to raise money to build a new factory. Read more

Shelf Registration

A shelf registration is the filing and registration with the Securities and Exchange Commission (SEC) for a security offering that is released to the public market incrementally over a period of time (shelf offering). Under Rule 415, the SEC allows an issuer to register new securities, and then shelve the public offering for up to two years. Read more

Shooting Star Candlestick

The shooting star candlestick is a chart formation consisting of a candlestick with a small real body, and a large upper shadow. This pattern represents a potential reversal in an uptrend. Read more

Short Covering

Short covering refers to the practice of purchasing securities to cover an open short position. To close out a position, a trader purchases the same number and type of shares that he sold short. Read more

Short Interest

Short interest is the number of shares or units of a security that have been sold short and not yet covered or repurchased. It is typically expressed as a percentage of the total securities outstanding. Read more

Short Interest Ratio

A short interest ratio is the number of shares or units of a security that have been sold short and not yet covered or repurchased. It is typically expressed as a percentage of the average daily trading volume. Read more

Short Interest Theory

Short interest theory suggests that a high level of short interest indicates an imminent rise in the price of a stock. Short interest theory posits that a high number of outstanding short positions on a stock predicts that a rise in the stock's price is likely to occur in the near future. Read more

Short Sale

A short sale is a three-step trading strategy that seeks to capitalize on an anticipated decline in the price of a security.  First, arrangements are made to borrow shares of the security, typically from a broker. Read more

Short Selling

Short selling is a trading strategy that seeks to capitalize on an anticipated decline in the price of a security.  Essentially, a short seller is trying to sell high and buy low. Read more

Short Squeeze

A short squeeze is a situation in which a stock's price increase triggers a rush of buying activity among short sellers.   Short sellers must buy stock to close out their short positions and cut their losses, which results in a further increase in stock prices, which compel still more short sellers to cover their positions. Read more

Short-Term Gain

Short-term gain usually refers to the profit on the sale of an investment that has been held less than a certain IRS-defined period of time. Let’s assume you purchase 100 shares of Company XYZ for $1 per share. Read more

Short-Term Investment

In regards to investing, “short-term” refers to an investment made that can easily be converted to cash in under five years. Usually, these investments are high-quality and very liquid assets or investment vehicles like certificates of deposit, money market accounts, high-yield savings accounts, or Treasury bills. Read more

Signature Loan

A signature loan is a loan offered by banks or other financial institutions that does not require collateral. Signature loans are also known as personal or unsecured loans since they are not secured by anything beyond trust that the borrower will pay it back. Read more

Signature-Debit Transaction

A signature-debit transaction, also known as an offline transaction, is a payment method that uses a debit card to transfer funds from a checking account to a merchant across a digital credit card network. When you pay for goods or services with your debit card, you have the option to process your payment in one of two ways: 1) as a signature-debit transaction via a credit card processing network, or 2) as an online transaction via an electronic funds transfer (EFT) system. Read more

Silicon Valley

Silicon Valley is the area around San Jose and San Francisco, California that is home to a number of well-known internet, software, and computer companies. Named for silicon, the element from which computer chips are produced, Silicon Valley is located in the area south of San Francisco and is known for its high-tech computer industry. Read more

Simple Interest

Simple interest is a basic formula for calculating how much interest to apply to a principal balance.  Simple Interest Formula:Simple Interest = Interest Rate x Principal BalanceFor example, let's assume that John Doe puts $1,000 in his savings account. Read more

Simplified Employee Pension (SEP) IRA

A simplified employee pension (SEP) is a type of individual retirement account (IRA) that can be opened by an employer on behalf of an employee or by a self-employed individual. It may also be known as a simplified employee pension individual retirement arrangement (or SEP IRA). Read more

Single-Payer System

A single-payer system is a health care system in which the government pays for all health care costs. Though there is considerable debate about how a single-payer system fundamentally works, by many accounts a single-payer system operates much like the Veterans Administration works today in the United States: Hospitals receive a general budget from the government, doctors receive a salary from the hospitals, and the government pays for the cost of care. Read more

Sinking Fund

A sinking fund is a part of a bond indenture or preferred stock charter that requires the issuer to regularly set money aside in a separate custodial account for the exclusive purpose of redeeming the bonds or shares. To understand how a sinking fund works, let's assume Company XYZ issues $10 million of bonds that mature in 10 years. Read more

Small-Cap Stock

Small-cap stock refers to a company with a market capitalization (calculated by taking a firm's current share price and multiplying that figure by the total number of shares outstanding) near the low end of the publicly traded spectrum.  The boundaries that separate these classifications are not clearly defined and can vary according to the source. Read more

Smartphone Banking

Smartphone banking is the use of a smartphone or other cellular device to perform tasks such as monitoring account balances, transferring funds between accounts, bill payment and locating an ATM while away from your home computer. Smartphone banking typically operates across all major U. Read more

Social Security

Social security is a federal program that provides income and health insurance to retired persons, the disabled, the poor, and other groups. The program started in 1935 with the signing of the Social Security Act, which was an effort to provide a safety net for the millions of people who had suffered through the Great Depression. Read more

Social Security Tax

Social Security tax is an employment tax that funds the Social Security program, a mandatory U. S. Read more

Socially Responsible Investment (SRI)

Socially responsible investment (SRI) is an investment strategy that seeks both financial return and social good. Investment strategies are usually focused on returns on investment, seeking to maximize the profits for the investor. Read more

Sole Proprietorship

A sole proprietorship is a person who owns an unincorporated business by himself or herself. In a sole proprietorship, there is no legal distinction between the owner and the business entity. Read more


Solvency is a company’s ability to pay its debts as they become due. Solvency measures a company's ability to meet its financial obligations. Read more

Sour Crude

Sour crude is a type of unrefined oil that contains sulfur.   It is difficult to refine and usually fetches a lower price. Read more

Sovereign Debt

Sovereign debt refers to the amount of money a country owes to the holders of its government bond. In the United States, sovereign debt is issued by the Department of Treasury and the bonds are referred to as Treasuries -- Treasury notes, Treasury bonds, Treasury bills, etc. Read more

Special Assessment Bonds

Special assessment bonds (also known as special assessment obligations) are municipal bonds that are repaid with taxes assessed on the land that benefits from the improvements financed by the bonds. For example, let's assume ABC Town wants to revamp the sewer system in the XYZ neighborhood, but it does not have the $10 million necessary to do so. Read more

Special Assessment Obligations

Special assessment obligations (also called special assessment bonds) are municipal bonds that are repaid with taxes assessed on the property that benefits from the improvements financed by the bonds. For example, let's assume ABC Town wants to revamp the sewer system in the XYZ neighborhood, but it does not have the $10 million it needs to do so. Read more

Special Dividend

A special dividend, also known as an extra dividend, is a one-time distribution of corporate earnings to company shareholders, which usually stem from exceptional profits during a given quarter or period. Special dividends are typically disbursed in cash and tend to be a greater amount than the company’s standard dividend payment. Read more

Specific Risk

Specific risk is a discrete risk to which only a specific asset or type of asset is exposed. It is the opposite of systematic risk. Read more


Speculation is a method of short-term investing whereby traders essentially bet on the direction an asset's price will move. Technically, anyone who buys or shorts a security with the expectation of a favorable price change is a speculator. Read more

Speculation Index

The speculation index measures the volume of trades on the American Stock Exchange (AMEX) versus trade volume on the New York Stock Exchange (NYSE). The AMEX tends to list riskier stocks issued by smaller companies that are starting up or are trying to grow. Read more


A speculator is a person or an entity that trades securities essentially as bets that the price will go up or down, and as such, typically has an above-average risk tolerance. Although one can argue that all investment is speculation, an acknowledged speculator will buy or sell a security solely to reap a typically short-term profit from the price movement of that security. Read more

Spider (SPDR)

A spider (SPDR) is an exchange-traded fund (ETF) that tracks the Standard & Poor's 500 Index. SPDR stands for S&P Depository Receipts. Read more

Spinning Top Candle

Spinning tops have small real bodies, and they portray a stock or index plagued by uncertainty. The spinning top has small upper and lower shadows. Read more

Spot Market

Also called the cash market or the physical market, the spot market is where assets are sold for cash and delivered immediately. Spot markets differ from futures markets in that delivery takes place immediately. Read more

Spot Price

The spot price is the current market price at which an asset is bought or sold for immediate payment and delivery.   It is differentiated from the forward price or the futures price, which are prices at which an asset can be bought or sold for delivery in the future. Read more

Spot Secondary

A spot secondary is a secondary stock offering that doesn't require the company to register with the Securities and Exchange Commission (SEC). A spot secondary is generally a transaction with just one type of holder -- usually institutional investors -- and so it is not subject to the typical underwriting protocol associated with issuing stock. Read more

Spot Trade

A spot trade is an asset or commodity transacted and delivered immediately. Also called cash trades, spot trades occur in the spot market and are characterized by the immediate or near-immediate delivery of the commodity in question. Read more

Spousal Support

Spousal support is a series of payments to a separated or ex-spouse according to a divorce decree or separation agreement. Also known as "alimony," the idea behind spousal support is to provide a spouse with lower income or lower income potential with financial support. Read more

Spread Trade

A spread trade occurs when an investor simultaneously buys and sells two related securities that are bundled as a single unit. Each of the transactions is referred to as a "leg. Read more


Springs are false breakouts that can trap the unsuspecting trader. Spring patterns quickly reverse, with the stock or index then often testing the opposite end of the trading range. Read more

Springs and Upthrusts

Springs and upthrusts are false breakouts that can trap the unsuspecting trader. Both patterns quickly reverse, with the stock or index then often testing the opposite end of the trading range. Read more

Squawk Box

A squawk box is a speaker used at brokerage firms and investment banks to help brokers, analysts and traders communicate with each other. Squawk Box is also an early morning business program on CNBC. Read more

SSE Composite Index

The SSE Composite Index tracks the largest and most important public companies in China.   The SSE Composite Index is similar to the Dow Jones Industrial Average (DJIA) in the U. Read more

Standard & Poor's (S&P)

Standard & Poor's (S&P) is a financial services company and a division of The McGraw-Hill Companies, Inc. S&P does business in six main areas: credit ratings, indices, equity research, risk management, investment advisory services, and data services. Read more

Standard Deduction

A standard deduction is a reduction in taxable income. Federal, state and local tax codes determine what is deductible and which taxpayers are eligible for deductions. Read more

Standard Deviation

Standard deviation is a measure of how much an investment's returns can vary from its average return. It is a measure of volatility and, in turn, risk. Read more

Statement of Income

The statement of income is one of the three primary financial statements used to assess a company’s performance and financial position at the end of an accounting period (the two others being the balance sheet and the cash flow statement). Specifically, it summarizes a company's revenues and expenses over the entire reporting period. Read more

Statement of Operations

The statement of operations is one of the three primary financial statements used to assess a company’s performance and financial position (the two others being the balance sheet and the cash flow statement). The statement of operations summarizes a company's revenues and expenses over the entire reporting period. Read more

Step-Up Bonds

A step-up bond is a bond with a coupon that increases ("steps up"), usually at regular intervals, while the bond is outstanding. Step-up bonds are often issued by government agencies. Read more

Step-Up in Basis

A step-up in basis refers to an increase in the price at which an investment is considered to have been purchased. Let's assume that your uncle purchased 100 shares of Disney in 1970 for $1 per share. Read more

Stochastic Oscillator

The stochastic oscillator is a momentum indicator that shows the location of the current closing price of a security (or index) relative to the high/low range over a set number of periods. The idea behind stochastics is that as the price of a security increases, the closing price will fall closer to the highest point over a given period. Read more


This is a momentum indicator that shows the location of the current close relative to the high/low range over a set number of periods. Momentum indicators try to identify turning points by measuring how fast prices are rising or falling. Read more

Stochastics Indicator

The stochastics indicator is a momentum indicator that shows the location of the current closing price relative to the high/low range over a set number of periods. The stochastics indicator tries to identify turning points by measuring how fast prices are rising or falling. Read more


Stock, also known as equity, represents ownership interests in corporations. Whether you own one, 100 or 100 million shares of stock in a company, you're an owner of the company. Read more

Stock Dividend

Dividends are a distribution of corporate earnings to shareholders and usually take place in one of two forms -- cash or stock. A stock dividend is the latter of these two kinds of dividends. Read more

Stock Exchange Daily Official List (SEDOL)

The Stock Exchange Daily Official List code is a unique identifier generated by the London Stock Exchange for securities issued in the U. K. Read more

Stock Market Crash of 1929

The stock market crash of 1929 is the most famous stock market crash of all time. On just one day (October 24, 1929), panicked sellers traded nearly 13 million shares on the New York Stock Exchange (more than three times the normal volume at the time), and investors suffered $5 billion in losses. Read more

Stock Market Crash of 1987

The stock market crash of 1987, also called Black Monday, refers to the 509-point fall in the Dow Jones Industrial Average on October 19, 1987, one of the worst days in the average's history.   Black Monday is perhaps the most famous trading day in Wall Street history. Read more

Stock Market Index

A stock market index measures the change in the stock prices of the index's components. Let's say we want to measure the performance of the U. Read more

Stock Option

A stock option gives the holder the right, but not the obligation, to purchase (or sell) 100 shares of a particular underlying stock at a specified strike price on or before the option's expiration date. There are two kinds of options: American and European. Read more

Stock Quote

A stock quote is an estimate of price or a price at which one party is willing to buy or sell a certain number of shares of stock from the other. A stock quote consists of a bid price and an ask price. Read more

Stock Return Income Debt Securities (STRIDES)

Stock Return Income Debt Securities (STRIDES) are callable debt securities linked to an underlying stock. STRIDES are similar to callable preferred shares in that they take part in the fluctuation of the underlying stock's price but also provide a fixed payment. Read more

Stock Savings Plan

A stock savings plan is a Canadian taxation system that offers tax benefits to Canadian residents who purchase the initial public offerings (IPOs) of local companies. Each Canadian province has its own stock savings plan. Read more

Stock Split

A stock split is a procedure that increases or decreases a corporation's total number of shares outstanding without altering the firm's market value or the proportionate ownership interest of existing shareholders. This action, which requires advance approval from the company's board of directors, usually involves the issuance of additional shares to existing stockholders. Read more

Stock Symbol

A stock symbol -- also known as a ticker symbol -- is a string of letters used to identify a stock, bond, mutual fund, ETF or other security traded on an exchange. When a company goes public or issues securities to the public, it selects an exchange on which those securities will trade and a stock symbol that will identify those securities. Read more


A stockbroker is a person or a company that acts as an intermediary between buyers and sellers of stocks. Stockbrokers are often paid a commission, which is a percentage of the customer's purchase or sale price, though some receive a flat fee per transaction or a mix of the two. Read more

Stop Order

A stop order (also called a stop-loss order or stop market order) is a trade order whereby the investor instructs the broker to automatically sell the stock if it drops to a certain price. For example, let's assume that you own 100 shares of Company XYZ stock, for which you have paid $10 per share. Read more

Stop-Limit Order

A stop limit order is a tool that is used to help traders limit their downside risk when buying or selling stocks. To do this, it combines two other types of orders: a stop order and a limit order. Read more

Stop-Loss Order

A stop-loss order (also called a stop order or stop market order) is an order whereby the investor instructs the broker to automatically sell the stock if it drops to a certain price. For example, let's assume that you own 100 shares of Company XYZ stock, for which you have paid $10 per share. Read more

Straight Line Basis

Straight line basis refers to a method of calculating the depreciation of an asset.  Straight Line Basis calculates depreciation which is an accounting measure of the "loss" of value of an asset over time. Read more

Straits Times Index (STI)

The Straits Times Index is Singapore's premier equity index and the most widely used benchmark for the performance of equities traded on the Singapore Stock Exchange. The index is comprised of 55 of the exchange's most valuable firms. Read more

Strategic Asset Allocation

Strategic asset allocation is the practice of realigning a portfolio's asset composition in order to accommodate changes in market climate. Portfolios are made up of different asset classes, with each asset class comprising a certain percentage of the total portfolio (i. Read more

Strategic Buyout

A strategic buyout is a merger wherein one company acquires another based on the belief that the synergy of their combined operational capabilities will generate higher profits than if the two had remained independent. In many cases, the operating abilities of one company will complement those of an acquiring company in such a way that, if combined, the operational capacity of the two could generate substantially higher profits. Read more

Stratified Sampling Approach

A stratified sampling approach is an indexing strategy whereby a fund manager divides an index into different "cells" that represent different characteristics of the index. The fund manager then chooses investments that mimic those cells. Read more

Street Expectation

The street expectation is the commonly-held estimate of a company's future performance by market analysts. Market analysts consider economic conditions, consumer sentiment, research and development, new products, competition, management efficiency and a whole host of other industry-specific factors to establish their expectation. Read more

Strike Price

Strike price, also referred to as “exercise price,” is the specific price at which an investor can exercise an option to buy or sell an option contract’s underlying security, such as stocks, bonds, and commodities. The strike price of an option is a fixed dollar amount that stays the same during the entire option contract term. Read more


STRIPS stands for Separate Trading of Registered Interest and Principal of Securities. They are securities that represent the separate interest and principal components of Treasury securities. Read more

Strong-Form Efficiency

Strong-form efficiency is a component of the random walk theory and states that market and securities prices are not random and are influenced by past events. Strong-form efficiency is the opposite of weak form efficiency. Read more

Structural Unemployment

Structural unemployment is a category of unemployment arising from the mismatch between the jobs available in the market and the skills of the available workers in the market. Structurally unemployed people usually have skills that are not needed in the market or have a specialized background or experience that cannot be used in the current market. Read more

Structured Finance

Structured finance is a complex financial instrument offered to borrowers with unique and sophisticated needs. Generally, a simple loan will not suffice for the borrower so these more complex and risky finance instruments are implemented. Read more

Structured Portfolio

A structured portfolio is a type of passively managed portfolio whose cash inflows are designed to meet the cash outflow requirements to fulfill a future obligation. A structured portfolio is also referred to as a dedicated portfolio. Read more

Student Loan

For the majority of Americans, taking on a student loan is a requirement to pay for college. A 2019 report estimated that 43 million American adults have federal student loans – with a combined total balance of $1. Read more


Subordinate means "ranks beneath. " In finance, the term usually refers to the claims a creditor has on a company's assets relative to other creditors. Read more

Subordinated Debt

Subordinated debt is any outstanding loan that, should the borrowing company fail, it will be repaid only after all other debt and loans have been settled. It is the opposite of unsubordinated debt. Read more

Subscription Privileges

Subscription privileges are a clause in an option, security, or merger agreement that gives the investor the right to maintain his or her percentage ownership of a company by buying a proportionate number of shares of any future issue of the security. Subscription privileges are sometimes called "subscription rights," "anti-dilution provisions," or "anti-dilution provisions. Read more

Subscription Rights

Subscription rights are a clause in an option, security, or merger agreement that gives the investor the right to maintain his or her percentage ownership of a company by buying a proportionate number of shares of any future issue of the security. Subscription rights are sometimes called "anti-dilution provisions," "preemptive rights," or "subscription privileges. Read more

Suicide Pill

The suicide pill is a takeover defense mechanism whereby a target company takes self-destructive measures to thwart a hostile takeover. If a company becomes the target of a hostile takeover by another company, it may engage in a self-defeating move which renders it no longer attractive to the acquiring company. Read more

Super Bowl Indicator

The Super Bowl Indicator, also known as the Super Bowl Effect, is a theory that stock prices will fall if the AFC team wins the Super Bowl. The Super Bowl is the final game in the National Football League season. Read more

Supply Chain Management

Supply chain management (SCM) is the central organization of a company's production resources and materials intended to streamline the production process and reduce costs on a continuing basis. A company's production operation contains material input components, each of which incurs a cost which is recovered in the price of the finished product. Read more


In technical trading analysis, support is a lower limit in a price channel in which a security’s price tends to stay. Price channels can slope up (indicating bullish sentiment) or down (indicating bearish sentiment); they don’t have to simply go “sideways. Read more

Support Level

A support level is the price at which stock buyers jump in to purchase shares, establishing a floor beneath which it's difficult for the price to fall. Support, along with its cousin, resistance, are extremely important concepts in swing trading, and they are predicted by drawing horizontal trendlines on a stock price chart. Read more

Surrender Fee

A surrender fee is a fee paid by an annuity investor to withdraw some or all of his or her principal before the annuity's surrender period has expired. An annuity is a contract whereby an investor makes a lump-sum payment to an insurance company, bank or other financial institution that in return agrees to give the investor either a higher lump-sum payment in the future or a series of guaranteed payments. Read more

Surrender Period

The surrender period is the time an investor of annuity must wait until they may take a withdrawal from their annuity without paying a penalty or surrender fee. The surrender period is usually stated in the contractual agreement of the annuity an investor has purchased. Read more

Survivorship Bias

Survivorship bias occurs when companies that no longer exist -- due to bankruptcy, acquisition or any other reason -- are not accounted for when calculating investment returns.  For example, suppose an investor is researching returns on Portfolio XYZ over two consecutive years: 2006 and 2007. Read more

Sustainable Growth Rate

The sustainable growth rate represents how quickly a company can expand using only its own sources of funding. A company's sustainable growth rate is expressed mathematically in the following way: Sustainable Growth Rate = Return on Equity * (1 –  Dividend Payout Ratio) In other words, a sustainable growth rate is the product of a company's return on equity and the portion of its earnings that are remaining after dividends have been paid. Read more


A swap is an agreement between two parties to exchange a series of future cash flows. Swaps are financial agreements to exchange cash flows. Read more

Swap Spread

A swap spread is the difference between the fixed rate component of a given swap and the yield on a Treasury item or other fixed-income investment with a similar maturity. Companies engage in swaps in order to benefit from an exchange of comparative interest rate advantage. Read more

Sweat Equity

 Sweat equity is the time and effort that people contribute to a project. Sweat equity is used to describe the non-financial investment that people contribute to the development of a project such as a start-up business. Read more

Sweep Account

A sweep account is a bank or brokerage account that automatically transfers amounts above a certain threshold into a higher interest-earning investment option. These transfers are made at the close of each business day. Read more

Sweet Crude

Sweet crude is a type of yet-to-be refined oil which contains minimal amounts of impurities. Sweet crude oil meets standards for low levels of contaminants such as sulfur (below one percent). Read more

Swing Trading

Swing trading is a short-term strategy used by traders to buy and sell stocks whose technical indicators suggest an upward or downward trend in the near future -- generally one day to two weeks. Swing trading uses technical analysis to determine whether or not particular stocks might go up or down in the very near term. Read more

Swipe Fees

The term swipe fees, also known as interchange fees, refers to the hidden cost paid by merchants to card-issuing banks and credit card companies for processing credit card and debit card transactions. For example, when you use your debit card or credit card at a store or online, there is a hidden fee that is charged by the card-issuing banks to process this transaction. Read more

SWOT Analysis

SWOT stands for strengths, weaknesses, opportunities, and threats. A SWOT analysis uses internal and external data to evaluate a company's competitive status and risk exposures in strategic planning. Read more

Symmetrical Triangle

The symmetrical triangle is one of three important triangle patterns defined in classical technical analysis. The other two triangles are the bullish ascending triangle pattern and the bearish descending triangle pattern. Read more


A syndicate is a group of lenders or underwriters that come together to share or participate in a specific loan or investment. A project may require too large of financial investment for a single lender or require a special type of investor or lender with expertise in a particular asset class. Read more

Syndicated Loan

A syndicated loan is a loan made by a group of lenders who share or participate in a specific loan given to a project. A project may require too large a loan for a single lender or require a special type of investor or lender with expertise in a particular asset class. Read more


Synergy is the benefit that results when two or more agents work together to achieve something either one couldn't have achieved on its own.   It's the concept of the whole being greater than the sum of its parts. Read more

Synthetic Collateralized Debt Obligation (Synthetic CDO)

A synthetic collateralized debt obligation is a collateralized security which is backed by derivatives such as swaps and options contracts. A synthetic collateralized debt obligation, commonly called a synthetic CDO, seeks to generate income from swap contracts, options, and other non-cash derivatives rather than straightforward debt instruments such as bonds, student loans, or mortgages. Read more

Synthetic Futures Contract

A synthetic futures contract comprises call options accompanied by put options in order to imitate the attributes of a futures contract. A synthetic long futures contract can be simulated using a short put option in conjunction with a long call option. Read more

Systematic Risk

Also called market risk or non-diversifiable risk, systematic risk is the fluctuation of returns caused by the macroeconomic factors that affect all risky assets.  Unsystematic risk is the risk that something with go wrong on the company or industry level, such as mismanagement, labor strikes, production of undesirable products, etc. Read more