Author: user

Speculator What is a speculator? A speculator is a market participant who seeks to profit from short-term price movements rather than long-term ownership. Unlike traditional investors who focus on fundamentals and extended time horizons, speculators use shorter holding periods and active trading techniques to capture rapid gains. Speculators can be individuals, market makers, proprietary trading…

Understanding Speculation: High-Risk Trading With Reward Potential Speculation is the practice of making financial transactions that carry a high risk of loss in pursuit of substantial short-term gains. Speculators focus on price movements over days, hours, or even seconds, rather than the long-term fundamental value of an asset. Speculative activity occurs across markets — including…

Specialization Specialization is the process of concentrating resources, skills, or production on a limited range of goods or services to increase efficiency. By focusing on what they do relatively best, individuals, firms, regions, and countries can produce more, trade for what they do not produce, and raise overall productivity. Key takeaways Specialization concentrates effort on…

Special Warranty Deed A special warranty deed (also called a limited warranty deed, covenant deed, or grant deed in some states) transfers property with a limited guarantee: the seller (grantor) promises only that there were no title defects or encumbrances created or suffered during the seller’s period of ownership. It does not protect against defects…

Special Purpose Vehicle (SPV) A Special Purpose Vehicle (SPV), also called a Special Purpose Entity (SPE), is a legally separate entity created by a parent company to isolate financial risk, hold specific assets, or carry out a defined transaction. Because the SPV is distinct from the parent, its assets, liabilities, and cash flows can be…

Special Purpose Acquisition Company (SPAC) What is a SPAC? A special purpose acquisition company (SPAC), often called a “blank-check company,” is a shell company formed to raise capital through an initial public offering (IPO) for the sole purpose of acquiring or merging with an existing private company. SPACs have no commercial operations at IPO —…

Special Power of Attorney Definition A special power of attorney (also called a limited power of attorney) is a legal document that authorizes a named agent (attorney‑in‑fact) to perform specific tasks or make certain decisions for the principal. Its scope and duration are narrowly defined in the document. Key takeaways Grants authority only for specific…

Special Economic Zones (SEZs): Purpose, Types, and Impact Special Economic Zones (SEZs) are geographically defined areas within a country where business and trade laws differ from the rest of the country. They are created to accelerate economic growth by attracting investment, boosting exports, encouraging industrialization, and promoting technology transfer through tailored incentives and streamlined procedures….

Special Drawing Rights (SDRs) What are SDRs? Special Drawing Rights (SDRs) are an international reserve asset created by the International Monetary Fund (IMF) in 1969 to supplement member countries’ official reserves and enhance global liquidity. SDRs are not a currency in themselves but a claim on freely usable currencies of IMF members. They serve as…

Key takeaways * A sovereign wealth fund (SWF) is a state-owned investment vehicle that manages a country’s surplus reserves to generate long-term economic benefits for its citizens. * Funding sources include commodity revenues, trade surpluses, foreign-exchange reserves, privatization proceeds and budgetary surpluses. * SWFs vary by purpose, risk tolerance, liquidity needs and governance — some…

Sortino Ratio What it is The Sortino ratio measures risk-adjusted return while penalizing only downside (harmful) volatility. Unlike the Sharpe ratio, which uses total return volatility, the Sortino ratio focuses on negative deviations from a chosen target (commonly the risk-free rate or a minimum acceptable return). A higher Sortino ratio indicates more return per unit…

Solvency Ratio Key takeaways A solvency ratio measures a company’s ability to meet long-term debts and remain solvent. Common solvency ratios: debt-to-assets, debt-to-equity (D/E), interest coverage, and equity (shareholder equity) ratio. Lenders and long-term investors use solvency ratios to assess creditworthiness and financial risk. Solvency ratios focus on long-term obligations; liquidity ratios focus on short-term…

What is solvency? Solvency is a company’s ability to meet its long-term debts and financial obligations and continue operating into the future. A simple solvency check uses the balance sheet: assets minus liabilities equals shareholders’ equity. If that difference is positive, the company is solvent on a book-value basis. Solvency in business operations Shareholders’ equity…

Sole Proprietorship A sole proprietorship is the simplest business structure: an unincorporated business owned and operated by a single individual. There is no legal separation between owner and business, so the owner receives all profits and is personally responsible for all debts and obligations. Key takeaways Single-owner business with no separate legal entity. Simple and…

Software as a Service (SaaS) Software as a Service (SaaS) is a cloud-based software delivery model in which applications are hosted by a provider and made available to users over the Internet, typically via subscription. SaaS eliminates the need for local installation and ongoing in-house maintenance, making it a popular choice for businesses of all…

What Are Soft Skills? Definition, Importance, and Examples Soft skills are personal attributes and interpersonal abilities—such as communication, teamwork, and adaptability—that determine how effectively someone interacts with others and navigates the workplace. They complement hard skills (technical, measurable abilities) and play a central role in hiring, promotion, team performance, and leadership effectiveness. Key takeaways Soft…

Société Anonyme (S.A.): Definition, Examples, Requirements Definition A société anonyme (S.A.) is a corporate business structure originating in France, equivalent to a corporation in the United States or a public limited company (PLC) in the United Kingdom. An S.A. is a separate legal person that can own property, enter contracts, and be held liable for…

Guide to Socially Responsible Investing: Principles and Benefits What is socially responsible investing (SRI)? Socially responsible investing (SRI) seeks financial returns while supporting positive social and environmental outcomes. Investors use SRI to avoid companies and industries considered harmful (for example, tobacco, certain gambling or weapons makers) and to favor businesses that advance sustainability, social justice,…

Socialism: Definition, History, and Contemporary Forms What is socialism? Socialism is an economic and political framework that emphasizes collective or public ownership and democratic control of the means of production—factories, land, natural resources and infrastructure—so that production is organized to meet human needs rather than to maximize private profit. It contrasts with capitalism, which centers…

Understanding the Social Welfare System What it is A social welfare system is a network of government programs that provide financial aid and essential services to individuals and families facing hardship. Programs aim to meet basic needs—food, health care, housing, income support—and to promote economic stability and well‑being. Key takeaways Programs include cash assistance, health…

Understanding Social Security Numbers (SSN) Key takeaways * A Social Security number (SSN) is a unique nine-digit identifier issued by the Social Security Administration (SSA) to U.S. citizens, permanent residents, and certain temporary residents. * SSNs are used to track earnings, determine Social Security and Medicare benefits, and serve as a primary identifier for tax,…

What is the Social Security Administration (SSA)? The Social Security Administration (SSA) is the U.S. government agency that administers federal social insurance and assistance programs, including retirement, disability, and survivors’ benefits. The SSA issues Social Security numbers (SSNs), manages program finances and trust funds, handles enrollment for Medicare Parts A and B, and administers Supplemental…

Social Security Social Security (officially the Old-Age, Survivors, and Disability Insurance — OASDI — program) is a federal insurance system that provides monthly benefits to retired workers, disabled workers, and survivors of deceased workers. It is funded primarily by payroll taxes paid by employees, employers, and self-employed individuals and administered by the Social Security Administration…

Social Science Social science is the study of human behavior, relationships, and institutions. It explains how individuals interact within societies and how societies develop, organize, and change. Insights from social science inform public policy, education, urban planning, and business decisions such as marketing and product design. Key takeaways * Social science covers fields that examine…

Social Responsibility Social responsibility is the principle that individuals and organizations should act in ways that benefit society and the environment. For businesses, this idea is commonly expressed as corporate social responsibility (CSR): strategies and practices that balance profit-making with positive social and environmental outcomes. Why CSR Matters Consumers and investors increasingly favor companies that…

Understanding Social Networking: Platforms and Marketing Strategies Social networking uses internet-based platforms to connect people, organizations, and businesses. It serves both personal and commercial purposes: individuals use social networks to share updates and stay in touch, while businesses use them to build brand awareness, engage customers, and drive sales. Leading Platforms Facebook (Meta): Broad social…

Social Media: Definition, Evolution, Uses, Benefits, Risks, and Top Platforms What is social media? Social media comprises websites, apps, and online platforms that let people form networks and communities to share text, photos, videos, and other user-created content. Today more than five billion people—over half the world’s population—use social media for personal, professional, and commercial…

Social Justice Social justice is the principle that the benefits, opportunities, and privileges of a society should be distributed fairly. It focuses on how social institutions—education, health care, the legal system, the labor market, and public policy—shape people’s life chances and seeks to correct systemic barriers that produce unequal outcomes. Key points Social justice concerns…

Social Entrepreneurship: Definition, Models, and Impact What is a social entrepreneur? A social entrepreneur applies entrepreneurial methods to solve social, environmental, or community problems. Rather than prioritizing profit, they design sustainable, scalable solutions that generate measurable social impact—often blending business discipline with mission-driven goals. Why they matter Social entrepreneurs address root causes and resource imbalances…

Social Enterprise: Purpose, How It Works, and Practical Guidance What is a social enterprise? A social enterprise is a business organized to achieve positive social or environmental outcomes as its primary purpose. While it operates commercially and seeks revenue, profits are mainly reinvested to advance the mission rather than to maximize shareholder returns. Social enterprises…

Social Economics What it is Social economics (socioeconomics) studies how economic activity and social behavior influence one another. It examines how social groups and classes make economic decisions, how institutions and norms shape those decisions, and how economic outcomes feed back into social structures. Key takeaways Social economics links individual choices, social norms, and institutional…

Social Audits Key takeaways A social audit is a formal review of a company’s policies, practices, and conduct related to social responsibility and its impact on society. It assesses whether a company is meeting measurable goals and benchmarks for social performance. Social audits are flexible and voluntary; results can be used internally or shared publicly…

Smurfing Smurfing is a method of money laundering in which large amounts of cash are broken into many smaller transactions to evade financial reporting and detection. The goal is to move illicit proceeds into the legitimate financial system without triggering mandatory reports or suspicion. Key points Smurfing (also called structuring) divides large sums into smaller…

The Smoot-Hawley Tariff Act Overview The Smoot-Hawley Tariff Act (formally the United States Tariff Act of 1930) sharply raised U.S. import duties with the stated aim of protecting American farmers and industries from foreign competition. Widely remembered for its role in escalating global trade tensions, the law is commonly cited as a significant factor that…

Understanding Smart Money: Insights for Investors and Traders Smart money refers to capital controlled by experienced, well-informed market participants—such as institutional investors, hedge funds, private-equity firms, central banks, corporate insiders, and some high‑net‑worth individuals—whose large-scale decisions can influence market trends. Tracking and interpreting smart‑money activity can help individual investors and traders better understand market direction,…