Tracker Fund: What it Is, How It Works, Examples What is a tracker fund? A tracker fund is a pooled investment that seeks to replicate the holdings and performance of a specific market index. Also called an index fund, it provides broad exposure to a market or a segment of a market at low cost….
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Total Utility
Total Utility What is total utility? Total utility is the total satisfaction or happiness a consumer derives from consuming a given quantity of a good or service. It aggregates the utility from each unit consumed and helps explain consumer choices and demand. Utility, marginal utility, and rational choice Utility: a subjective measure of satisfaction from…
Total Shareholder Return (TSR)
Total Shareholder Return (TSR) What is TSR? Total shareholder return (TSR) measures the total financial return a shareholder receives from a stock over a specified period. It combines capital gains (price appreciation) and cash distributions such as dividends, and can also include special payouts, stock splits, or warrants. TSR is usually expressed as a percentage….
Total Return Swap
Total Return Swap A total return swap (TRS) is a bilateral derivative contract that transfers the economic performance of a reference asset from one party to another without transferring legal ownership. One counterparty (the total return receiver) receives all cash flows and capital appreciation—or bears depreciation—on the reference asset. In return, the receiver pays the…
Total Return Index
What is a total return index? A total return index measures the performance of a group of securities by combining capital appreciation (price changes) with the reinvestment of all cash distributions, such as dividends and interest. Unlike a price return index, which tracks only price movements, a total return index reflects the compound effect of…
Total Return
What is total return? Total return measures an investment’s overall performance over a specified period by combining: * Capital gains (change in market price) * Income (dividends or interest) * Other distributions (capital gain distributions from funds) Expressed as a percentage, total return captures both price appreciation and income, giving a fuller picture of how…
Total Quality Management (TQM)
Total Quality Management (TQM) Total Quality Management (TQM) is a continuous, organization-wide approach to improving quality in products, services, and processes. It seeks to reduce errors, streamline operations, strengthen supply-chain performance, and enhance customer satisfaction by making quality everyone’s responsibility. Why TQM Matters Improves customer satisfaction by aligning products and services with customer needs. Reduces…
Total Liabilities
Total Liabilities Total liabilities are a company’s or individual’s financial obligations that have not yet been paid. On the balance sheet, liabilities plus equity equal total assets: Assets = Liabilities + Equity Explore More Resources › Read more Government Exam Guru › Free Thousands of Mock Test for Any Exam › Live News Updates ›…
Total Expense Ratio (TER)
Total Expense Ratio (TER) The Total Expense Ratio (TER) measures the annual cost of running an investment fund, expressed as a percentage of the fund’s assets. It shows the proportion of a fund’s assets used to pay operating expenses such as management fees, trading costs, legal and audit fees, and administrative overhead. TER is also…
Total Enterprise Value (TEV)
Total Enterprise Value (TEV) Key takeaways * TEV measures a company’s total economic value by combining equity and debt while adjusting for cash. * Formula: TEV = Market capitalization + Market value of debt + Preferred stock − Cash and cash equivalents. * TEV is preferred to market capitalization when comparing companies with different capital…
Total-Debt-to-Total-Assets
Total Debt-to-Total Assets Ratio Overview The total debt-to-total assets ratio (also called the debt-to-assets ratio) is a leverage measure that shows what portion of a company’s assets is financed with debt. It helps investors and creditors assess financial risk and a firm’s reliance on borrowed funds versus owner (equity) financing. Formula TD/TA = (Short‑Term Debt…
Total Debt-to-Capitalization
Total Debt-to-Capitalization Ratio Definition The total debt-to-capitalization ratio measures the proportion of a company’s capital that is financed with debt. It is a solvency and leverage metric that shows how much of the company’s funding comes from creditors (short- and long-term debt) versus owners (shareholders’ equity). A higher ratio indicates greater leverage and a higher…
Total Debt Service Ratio
Total Debt Service (TDS) Ratio Key takeaways * The TDS ratio measures the share of gross income used to pay housing and other debts. * It helps lenders assess whether a borrower can handle additional credit, especially mortgages. * Typical lender benchmarks range from about 36% (preferred) up to 43% (maximum for most lenders). *…
Total Cost of Ownership (TCO)
Total Cost of Ownership (TCO) Key takeaways TCO equals an asset’s purchase price plus all operating, maintenance, and disposal costs over its useful life. TCO helps compare long-term value rather than just upfront price. Businesses and individuals use TCO to judge investments—from technology and equipment to vehicles and homes. What is TCO? Total Cost of…
Total Bond Fund
What is a Total Bond Fund? A total bond fund is a mutual fund or exchange-traded fund (ETF) that provides broad exposure to the bond market by holding many fixed-income securities across issuers, credit qualities, and maturities. These funds typically track a broad bond index (commonly the Bloomberg/Barclays Aggregate Bond Index) that includes Treasury bonds,…
Tort Law
Understanding Tort Law Tort law governs most civil claims that arise from wrongful acts (excluding contract disputes). Its primary purpose is to make injured parties whole by awarding monetary compensation for harms such as lost income, medical expenses, and pain and suffering. In some cases, courts may impose punitive damages to punish particularly wrongful conduct….
Toronto Stock Exchange (TSX): What It Is and How It Works
Toronto Stock Exchange (TSX): What It Is and How It Works Overview The Toronto Stock Exchange (TSX) is Canada’s largest stock exchange and one of the biggest in the world. Founded in 1861 and fully electronic since 1997, the TSX lists more than 1,500 companies across sectors such as energy, mining, technology, and real estate….
Top-Down Investing
Top-Down Investing Top-down investing is an investment approach that begins with macroeconomic analysis—looking at economy-wide factors such as GDP growth, inflation, interest rates, fiscal and monetary policy, trade balances, and currency trends—and then narrows down to attractive regions, sectors, and finally individual securities. How it works Analyze macroeconomic conditions: Global and national growth prospects (GDP…
Top-Down Analysis
Top-Down Investing Top-down investing is an investment approach that starts with broad macroeconomic analysis and narrows down to sectors and individual securities. Investors using this method prioritize economic indicators and market trends—such as GDP growth, inflation, interest rates, currency movements, and trade balances—before selecting regions, sectors, and finally companies. Key takeaways Begins with macroeconomic and…
Top Line
Top Line: Definition and Importance on Financial Statements Definition The top line refers to a company’s gross sales or total revenue, reported as the first line on the income statement. It represents the total amount earned from selling goods or services before any costs or expenses are deducted. How it fits on the income statement…
Too Big to Fail
Too Big to Fail — Definition, History, Reforms, and Criticisms What “Too Big to Fail” Means “Too big to fail” (TBTF) describes firms or sectors so embedded in a financial system that their failure would cause severe economic disruption. When policymakers believe a collapse would trigger systemic risk, they may intervene — through bailouts, purchases…
Tontine
Tontine What is a tontine? A tontine is a pooled-capital arrangement in which participants contribute money to a common fund and receive periodic payments derived from the fund’s investment returns. As participants die, their shares are redistributed among survivors, so individual payouts rise for those who remain alive. The arrangement ends when the last participant…
Tomorrow Next (Tom Next)
Tomorrow Next (Tom Next) in Forex — Definition and Purpose Tomorrow next, often written tom next, is a short-term foreign exchange transaction that lets traders extend a position for one business day without taking physical delivery of the currency. It is effectively a one-day rollover: the trader simultaneously enters offsetting trades that move settlement from…
Tombstone
Tombstone: The Public Offering Advertisement What is a tombstone? A tombstone is a brief written advertisement placed by investment banks underwriting a public offering. It announces that securities are available for purchase and provides basic details about the offering and the underwriting syndicate. The ad typically points prospective investors to the full prospectus for complete…
Tokyo Price Index (TOPIX)
Tokyo Price Index (TOPIX) Key takeaways * TOPIX is a capitalization-weighted index published by the Tokyo Stock Exchange (TSE) that tracks all companies listed in the TSE’s “first section” (Japan’s largest firms). * It provides a broad, market-capitalization–based picture of Japanese equity market performance, in contrast to the price-weighted Nikkei 225. * TOPIX is used…
Tobin Tax
Tobin Tax: Definition and Purpose The Tobin tax is a small tax on spot currency conversions designed to discourage short-term currency speculation and stabilize exchange markets. Proposed by economist James Tobin in 1972, it is often discussed today as a form of Financial Transactions Tax (FTT) or, informally, a “Robin Hood tax.” Tobin argued the…
Tobacco Tax/Cigarette Tax
Tobacco Tax (Cigarette Tax): Meaning, Limits, Pros, and Cons Definition A tobacco tax, commonly called a cigarette tax, is a government-imposed levy on tobacco products intended to raise the retail price, discourage use, and generate public revenue—often earmarked for health programs. How tobacco taxes are applied Types of taxes: excise taxes (most common), sales taxes,…
To Be Announced (TBA)
What “To Be Announced” (TBA) Means “To Be Announced” (TBA) is a forward-settling trading convention used primarily in the mortgage-backed securities (MBS) market. In a TBA trade, buyers and sellers agree on key contract terms—issuer, maturity, coupon, price, par amount, and settlement date—but the exact pools backing the security are not specified until shortly before…
Title Search
Title Search: What It Is, How It Works, and Why It Matters Quick summary * A title search examines public records to verify legal ownership and reveal liens, judgments, or other claims on a property. * Title searches are typically done by title companies or attorneys and are a standard part of real estate closings….
Title Insurance
Title Insurance Key takeaways Title insurance protects owners and lenders from financial loss due to defects in a property’s title (e.g., liens, back taxes, forged documents). Unlike standard insurance, it protects against past events discovered after purchase. Lenders almost always require lender’s title insurance; owner’s title insurance is optional but recommended. Coverage is purchased for…
Tit for Tat
Tit for Tat Overview Tit for tat is a simple yet powerful strategy from game theory for repeated interactions. First articulated by Anatol Rapoport, the approach begins with cooperation and then mirrors an opponent’s previous move: cooperate if they cooperated, retaliate if they defected. It illustrates how reciprocity can sustain cooperation and deter exploitation across…
TINA (There is No Alternative)
TINA (There Is No Alternative) What TINA Means TINA stands for “there is no alternative.” It’s used to justify choosing an option perceived as the least bad when all other choices seem unsatisfactory. In finance, politics, and public debate, TINA describes decision-making driven more by the absence of credible alternatives than by strong support for…
Times-Revenue Method
Times-Revenue Method What it is The times-revenue method values a company by multiplying its revenue over a set period (commonly the prior 12 months) by a chosen multiple. It’s a simple, revenue-based shortcut for estimating company value, often used when earnings are volatile, nonexistent, or unreliable. Key takeaways Value ≈ annual revenue × revenue multiple….
Time-Weighted Rate of Return (TWR)
Time-Weighted Rate of Return (TWR) What it is The time-weighted rate of return (TWR) measures a portfolio’s compound growth rate while eliminating the effect of external cash flows (deposits and withdrawals). By dividing the total period into sub-periods between cash flows, computing each sub-period’s return, and linking them geometrically, TWR isolates the investment performance driven…
Time Value of Money (TVM)
Time Value of Money (TVM) What is TVM? The time value of money (TVM) is a fundamental financial concept: a dollar today is worth more than the same dollar in the future. That difference arises because money you have now can be invested to earn returns, and because inflation erodes future purchasing power. Key ideas…