Category: Financial Terms

The Greatest Generation: Definition and Characteristics What the term means The Greatest Generation (also called the G.I. Generation or the WWII Generation) generally refers to Americans born roughly between 1900 and 1925. They grew up during the Great Depression and, as adults, fought in World War II or contributed on the home front. The phrase…

Tezos (XTZ): Definition and How It Works What is Tezos? Tezos is a decentralized blockchain platform and cryptocurrency (token: XTZ, often called “tez” or “tezzie”) designed to support smart contracts, decentralized applications (dApps), DeFi, and NFTs. Its distinguishing feature is an on-chain governance system that enables protocol upgrades through stakeholder voting, aiming to avoid hard…

Texas Ratio: Meaning and How It Works Key takeaways * The Texas ratio assesses a bank’s credit stress by comparing non-performing assets to the capital available to cover losses. * Formula: Texas ratio = Non-performing assets / (Tangible common equity + Loan loss reserves). * A ratio above 100% means non-performing assets exceed the bank’s…

What is Tether (USDT)? Tether (USDT) is a stablecoin — a type of cryptocurrency designed to maintain a stable value by pegging to a traditional asset, most commonly the U.S. dollar. Issued by Tether Limited (part of the iFinex group, which also operates Bitfinex), USDT is widely used as a bridge between fiat currencies and…

Testamentary Trust What is a testamentary trust? A testamentary trust is a trust created by the instructions in a person’s last will and testament. It becomes effective only after the testator (the person who made the will) dies and the will is admitted to probate. The trust appoints a trustee to hold and manage assets…

Tertiary Industry Definition The tertiary industry, or service sector, comprises businesses that provide services rather than producing physical goods. Examples include healthcare, education, finance, hospitality, transportation, and personal services. How the Tertiary Industry Fits the Economy Economies are often described in three sectors: * Primary: extraction of raw materials (agriculture, mining). * Secondary: manufacturing and…

Terms of Trade (TOT) What are Terms of Trade? Terms of Trade (TOT) measure the ratio of a country’s export prices to its import prices. It indicates how many imports a country can buy per unit of exports. A TOT greater than 100 (or increasing over time) means a country can obtain more imports for…

Terms of Employment What they are Terms of employment (also called conditions of employment or an employment contract) define the rights, responsibilities, and benefits that govern the employer–employee relationship. They typically cover job duties, work hours, compensation, benefits (for example, health insurance and retirement plans), workplace policies, and grounds for termination. Terms can be verbal,…

Termination of Employment Termination of employment is the formal end of the relationship between an employee and an employer. It can be initiated by either party and may occur for many reasons—downsizing, performance issues, misconduct, retirement, or mutual agreement. Employees temporarily away from work (illness, leave, furlough) remain employed unless they receive a formal notice…

Terminal Value (TV) Terminal value (TV) is the estimated value of a business, project, or asset beyond the explicit forecast period used in discounted cash flow (DCF) analysis. It captures the present value of all future cash flows after the forecast horizon, typically representing a large portion of the total DCF valuation. Key takeaways TV…

Terminal Capitalization Rate What it is The terminal capitalization rate (also called the exit rate) is the cap rate used to estimate a property’s resale value at the end of the holding period. It converts the expected net operating income (NOI) in the exit year into a terminal (resale) value. Formula: * Terminal value =…

Term to Maturity in Bonds Overview Term to maturity is the remaining length of time until a bond’s principal (par or face value) is repaid and interest payments stop. It helps determine the bond’s interest rate, price behavior in the secondary market, and investor risk. Key points Term to maturity is the period during which…

Term Structure of Interest Rates What it is The term structure of interest rates, commonly shown as the yield curve, maps bond yields against maturities. It reflects market expectations about future interest rates, inflation, and monetary policy, and serves as a key barometer of economic sentiment. Common yield-curve shapes and what they signal Upward sloping…

Term Sheet What is a term sheet? A term sheet is a concise, usually nonbinding document that records the principal terms and conditions under which parties intend to proceed with a transaction. It serves as a framework for negotiating and drafting the definitive, legally binding agreements that follow. Explore More Resources › Read more Government…

Term Loan — Definition and Overview A term loan is a lump-sum loan repaid over a specified period with either a fixed or variable interest rate. Businesses—especially established small businesses—commonly use term loans to buy fixed assets (equipment, real estate) or to finance longer-term working capital needs. Lenders typically require financial documentation, collateral, and sometimes…

Term Life Insurance Term life insurance provides a death benefit for a specified period. If the insured dies during that term, the policy pays the beneficiary a predefined sum. When the term ends, the policyholder can typically renew the policy (with higher premiums), convert it to permanent coverage if the policy allows, or let it…

Term Deposit What is a term deposit? A term deposit (often called a certificate of deposit or CD) is a savings product where you deposit money with a bank or credit union for a fixed period in exchange for a fixed interest rate. Funds are locked until maturity; early withdrawal usually triggers a penalty. Key…

Understanding Tenor Tenor is the length of time remaining before a financial contract or instrument expires. It is commonly used for loans, insurance agreements, and derivatives, and it influences perceived risk, pricing, and how cash flows are managed. Tenor vs. Maturity Tenor: the remaining time until a contract ends (declines over the life of the…

Tenkan-Sen (Conversion Line) What it is The Tenkan-Sen, or Conversion Line, is a component of the Ichimoku Kinko Hyo (Ichimoku Cloud) indicator. It represents the midpoint of the highest high and lowest low over the last nine periods and is the fastest-moving line in the Ichimoku system. Its primary role is to show short-term price…

What is a tender offer? A tender offer is a public proposal to buy some or all of a company’s outstanding shares at a specified price within a defined time window. The offer price is usually set at a premium to the current market price to encourage shareholders to sell. Tender offers can be for…

Tender (Finance and Business) A tender is an invitation to submit bids or offers. In business and government procurement, it refers to a formal solicitation for contractors or suppliers to compete for a project, supply contract, or service. In finance, it can also mean the acceptance of a formal offer—most commonly a tender offer, where…

Tenants by Entirety (TBE) What it is Tenants by the entirety (TBE) is a form of co-ownership available to married couples in many U.S. states. Under TBE, the couple is treated as a single legal unit that owns the whole property. Key features are mutual consent for transfers and an automatic right of survivorship: when…

Tenancy in Common (TIC) Tenancy in common (TIC) is a form of shared real estate ownership in which two or more people hold undivided interests in the same property. TIC allows unequal ownership percentages, independent transferability of shares, and the right to pass a share to heirs. It does not include rights of survivorship. Key…

Tenancy by the Entirety Tenancy by the entirety is a form of co-ownership reserved primarily for married couples. It treats the married couple as a single legal entity that holds equal, undivided title to property and includes a right of survivorship: when one spouse dies, the survivor automatically owns the property in full. Key takeaways…

Tenancy-at-Will What it is A tenancy-at-will is a flexible rental arrangement in which a tenant occupies property with the landlord’s permission but without a formal, fixed-term lease. Either party may end the tenancy at any time, subject to applicable state and local laws. These arrangements commonly arise when an oral agreement exists, when a written…

Tenancy at Sufferance Definition Tenancy at sufferance (also called an estate at sufferance or holdover tenancy) occurs when a tenant who lawfully occupied a rental property remains after the lease or tenancy term has expired and continues to occupy the premises without the landlord’s consent. The tenant no longer has permission to be there, though…

Temporal Method: Definition and How It Works The temporal method (also called the historical method) is a currency-translation technique used to convert a foreign subsidiary’s financial statements into the parent company’s reporting currency. It is applied when a subsidiary’s recorded currency differs from its functional currency or when remeasurement into the parent’s reporting currency is…

Telegraphic Transfers (TT): Overview, How They Work, and Key Points What is a Telegraphic Transfer? A telegraphic transfer (TT), also called a telex transfer, is an electronic method of moving funds—most often used for cross-border or interbank wire transfers. Today TTs are executed over secure banking networks rather than telegraph lines. They are a form…

TED Spread: Definition, Use, and Calculation What is the TED spread? The TED spread is the difference between the three‑month London Interbank Offered Rate (LIBOR) for U.S. dollars and the three‑month U.S. Treasury bill rate. It measures the gap between the interest rate banks charge one another for short‑term loans and the risk‑free rate represented…

Technology Sector Key takeaways The technology sector includes companies that research, develop, manufacture, or distribute technology-based goods and services: electronics, software, computers, networking, semiconductors, and IT services. Major tech firms—Apple, Google (Alphabet), Microsoft, Amazon and others—drive innovation and growth, often trading at higher valuation multiples than many other sectors. The sector spans consumer products (phones,…

Technology, Media, and Telecom (TMT) Sector: Overview and Investing Guide The Technology, Media, and Telecommunications (TMT) sector encompasses companies that develop and distribute computing hardware, semiconductors, software, media content and platforms, and communications services. TMT firms drive innovation through research and development (R&D) and frequently reshape markets via new technologies, mergers, and acquisitions. Generative AI…

Technocracy Technocracy is a model of governance in which decision-makers are selected for their technical expertise and specialized knowledge rather than through popular elections. Technocrats—experts in fields such as engineering, economics, medicine, or public administration—are charged with designing and implementing policy based on empirical evidence and technical reasoning. How technocracy works Selection: Technocrats are typically…

Technical Skills Technical skills are the specific abilities and knowledge needed to perform tasks in a particular job or field. They range from proficiency with software and programming languages to operating specialized machinery or applying industry-specific standards (for example, GAAP in accounting or PLC programming in manufacturing). Employers often use applicant tracking systems (ATS) to…

Technical Job Skills: Overview and Examples Technical job skills (also called hard skills) are specific, teachable abilities that enable someone to perform particular tasks or roles. They are acquired through education, training, practice, certification, or on-the-job experience and can be demonstrated through tests, credentials, portfolios, or work samples. Examples range from manual skills like operating…

Technical Indicator Technical indicators are mathematical calculations derived from price, volume, and open interest used in technical analysis to help forecast future price movements. Traders use them to identify trends, confirm momentum, spot potential reversals, and select entry and exit points. Common indicators include the Relative Strength Index (RSI), Moving Average Convergence Divergence (MACD), Bollinger…