Category: Financial Terms

Warranty of Title A warranty of title is a seller’s guarantee that they have the legal right to transfer ownership of a property and that no other parties have claims or encumbrances affecting that title. It protects buyers by providing legal recourse if undisclosed claims or defects in ownership surface after the sale. Key takeaways…

What is a warranty deed? A warranty deed is a legal document used in real estate transfers that guarantees the seller (grantor) holds clear title to a property and has the right to transfer it. It protects the buyer (grantee) by making the seller legally responsible for title defects or claims that arise after the…

Warranty: Definition, How It Works, and Key Points A warranty is a promise from a seller or manufacturer that a product will meet specified standards of performance and quality. If the product fails within the warranty’s terms, the seller or manufacturer agrees to repair, replace, or otherwise remedy the defect. Warranties give buyers recourse and…

Warrant Premium: Meaning, Calculation, and Examples A warrant premium is the extra amount investors pay for a warrant above its intrinsic (minimum) value. It reflects the market’s expectation about the underlying stock’s future price movement and other factors such as time to expiration and volatility. What a warrant is (brief) A warrant is a company-issued…

Warrant Coverage: Definition and Overview Warrant coverage is an agreement that gives an investor the right to purchase additional shares of a company at a specified price, usually tied to an investment or financing round. The company issues warrants equal to a percentage of the dollar amount invested (for example, 10% warrant coverage on a…

What Is a Warrant? A warrant is a financial derivative that gives its holder the right, but not the obligation, to buy (call warrant) or sell (put warrant) an underlying security at a predetermined price (the exercise or strike price) before a specified expiration. American-style warrants can be exercised any time up to expiration; European-style…

Warning Bulletin What is the Warning Bulletin? The warning bulletin (also called the cancellation bulletin, hot card list, or restricted card list) is a list of credit cards that have been canceled, reported past due, or stolen. Originally distributed weekly on paper by the major card networks, it is now maintained online and updated in…

Warm Card: What It Is and How It Works What is a warm card? A warm card—also called a deposit-only card—is a bank card issued to business employees to allow restricted access to company accounts. It typically permits deposits but blocks withdrawals, transfers, and other spending capabilities. The goal is to enable necessary cash-handling tasks…

Warm Calling Key takeaways * Warm calling is contacting a prospect with whom you or your company has had prior contact. * It’s generally more effective and efficient than cold calling because the prior interaction acts as an icebreaker. * Best used to set appointments or follow up rather than to force an immediate sale….

Warehousing in Investment Banking Key points Warehousing is the temporary accumulation of loans or bonds that will become collateral for a collateralized debt obligation (CDO). The warehousing period typically lasts about three months and ends when the assets are transferred into the CDO trust and securitized. During warehousing, the underwriting bank holds the assets on…

Warehouse-to-Warehouse Clause A warehouse-to-warehouse clause is an insurance provision that covers cargo during the period it is in transit between two warehouses. It protects against loss or damage that occurs while goods are being moved from an origin warehouse to a destination warehouse, but typically does not cover risks while goods remain in storage before…

Warehouse Receipt: What it is and How it Works Key takeaways A warehouse receipt is a document proving that a specified quantity and quality of a commodity is stored at an approved facility. It supports physical delivery and settlement of futures contracts and can serve as proof of ownership for inventory financing or collateral. Exchange-approved…

Warehouse Lending Warehouse lending is a short-term financing arrangement that lets mortgage originators fund loans without using their own capital. A warehouse lender (typically a larger bank or financial institution) provides a revolving line of credit that the originator draws on to close mortgage loans. Once a loan is sold into the secondary market, the…

Warehouse Financing Warehouse financing is a form of inventory-based lending in which a lender advances funds to a company using stored goods, commodities, or inventory as collateral. It is most commonly used by small- and medium-sized businesses, particularly in commodity and manufacturing sectors, that need working capital but have limited access to other forms of…

Warehouse Bond A warehouse bond is a surety bond that protects individuals or businesses that store goods in a warehouse. If a warehouse operator fails to meet contractual or legal obligations—resulting in loss or damage to stored property—a third-party surety may compensate the client and then seek reimbursement from the operator. Key takeaways Provides financial…

Understanding War Risk Insurance: Coverage, Exclusions & Benefits War risk insurance provides financial protection against losses caused by political or military violence that standard insurance policies typically exclude. It is most relevant for businesses and individuals exposed to conflict, terrorism, or political instability—particularly in aviation, maritime, and other high-risk industries. What war risk insurance covers…

What Is a War Exclusion Clause in an Insurance Contract? A war exclusion clause explicitly excludes coverage for losses caused by war-related events, such as invasions, insurrections, revolutions, military coups, and certain acts of terrorism. It means the insurer is not obligated to pay claims that arise from those perils. Why insurers include war exclusions…

War Economy Key takeaways A war economy reorganizes a country’s production and distribution to prioritize military needs during conflict. Governments redirect resources through measures such as rationing, taxes, borrowing, and state coordination of industry. War economies can accelerate industrial, technological, and medical innovation but often reduce civilian production and domestic investment. The balance between short-term…

War Chest What is a war chest? A war chest is a company’s reserve of readily accessible funds set aside to seize strategic opportunities or to protect against unexpected downturns. It’s most often kept in liquid forms—cash, bank deposits, Treasury bills—so it can be deployed quickly for acquisitions, investments, or emergency needs. Explore More Resources…

War Bonds War bonds are government-issued debt instruments used to raise money for military operations during armed conflict. They let citizens lend funds to their government—often through patriotic appeals—while governments avoid immediate tax increases or excessive money printing. Key takeaways Issued by governments to finance wars, usually sold at a discount to face value. Often…

Wanton Disregard Wanton disregard is a legal term describing an extreme lack of care for the safety, rights, or well‑being of others. It goes beyond ordinary negligence and indicates conduct so reckless that the actor consciously disregarded a known risk of substantial harm. The concept commonly appears in civil litigation, insurance disputes, workplace injury claims,…

Walrasian market A Walrasian market (also called a call market) is a market mechanism in which buy and sell orders are collected into batches, analyzed, and executed at a single clearing price that maximizes the number of trades. Instead of continuous one-by-one execution, transactions are matched and settled at discrete times using a price chosen…

Walras’s Law: Definition and Overview Walras’s law is a principle from general equilibrium theory stating that the value of aggregate excess demand across all markets must equal zero. In practical terms, if every market except one is in equilibrium (supply equals demand), the remaining market must also clear. Put another way: an excess supply (or…

Understanding the Walmart Effect The “Walmart Effect” describes the broad economic influence a Walmart store can have on a local community. Its arrival often reshapes retail markets, supplier relationships, consumer prices, and local labor markets—producing both benefits and costs. Key takeaways The Walmart Effect refers to the economic changes that occur when a Walmart opens…

Wall Street Journal Prime Rate What it is The Wall Street Journal (WSJ) Prime Rate is an aggregate measure of the prime lending rates reported by the largest U.S. banks. The prime rate itself is the lowest interest rate a bank charges its most creditworthy customers and often serves as the base (indexed) rate for…

Wall Street: Role, History, and Key Facts Wall Street is both a literal street in lower Manhattan and a widely used shorthand for the U.S. financial industry. It evokes stock exchanges, investment banks, brokerages, and the broader markets—and it often stands in contrast to “Main Street,” representing everyday businesses and individual investors. Key takeaways Wall…

Wall of Worry: What it Is and How It Works Definition A “wall of worry” describes how financial markets—especially stocks—can continue rising despite a buildup of negative news, economic concerns, or geopolitical risks. Rather than triggering a sustained selloff, these worries are absorbed as investors anticipate resolution or improved fundamentals. Key takeaways The phrase refers…

Walk-Through Test in Accounting A walk-through test is an audit procedure that traces a transaction step-by-step through an organization’s accounting system to verify that controls operate as intended and to identify control weaknesses or material deficiencies. What it is A walk-through test follows a single transaction (or a representative sample) from initiation through authorization, recording,…

Walk-Away Lease (Closed‑End Lease) A walk-away lease, also called a closed-end or true lease, is a vehicle rental agreement that lets the lessee return the car at the end of the term with no obligation to buy it. The lessor assumes the vehicle’s depreciation risk while the lessee keeps predictable monthly payments as long as…

Waiver of Subrogation: Definition, How It Works, and When to Use It Key takeaways A waiver of subrogation is a contractual provision that prevents an insurer from pursuing a third party to recover losses the insurer paid to its insured. Common in construction contracts, leases, and some auto settlements, waivers reduce litigation between contracting parties…

Waiver of Premium Rider: Benefits, Eligibility, and Costs Explained A waiver of premium rider is an optional provision on a life insurance policy that suspends premium payments if the insured becomes seriously ill, injured, or disabled. When the rider is triggered, the insurer stops collecting premiums while keeping the policy in force, preserving death benefits…

Waiver of Premium for Payer Benefit What it is A waiver of premium for payer benefit is a rider or clause in a life insurance policy that stops premium payments if the designated payor becomes disabled (or otherwise qualifies under the rider). It ensures the policy remains in force without the payor having to continue…

Waiver of Premium for Disability: Meaning and Key Points Key takeaways * A waiver of premium for disability is a policy provision that stops premium payments if the insured becomes seriously disabled. * Insurers often charge more to include this waiver. * Definitions of “totally disabled” vary by policy; typically the insured must be unable…

Waiver of Notice What is a waiver of notice? A waiver of notice is a written statement in which a person voluntarily gives up the right to receive formal advance notification of a legal proceeding or meeting. It allows the proceeding to go forward without having provided the standard notice to that person. Key points:…

Waiver of Exemption: What It Was and How It Works A waiver of exemption was a clause in consumer credit contracts that allowed creditors to seize property that state law otherwise protected from judgment creditors. The Federal Trade Commission (FTC) prohibited these waivers under the Credit Practices Rule of 1985. How waivers worked The waiver…