Capital Goods Price Index – Explained

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What is the Capital Goods Price Index (CGPI)?The Capital Goods Price Index (CGPI) is a statistic that monitors changes in the prices of fixed assets, as well as how changes in income affect changes in prices of these assets. CGPI is peculiar to New Zealand and it...

Constant Maturity (Treasury Security) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Constant Maturity?Constant maturity refers to a representation of maturity determined by the yield of various Treasury securities that have different maturity periods. The Federal Reserve Board uses constant maturity to generate an index for the average yield...

Consensus Estimate – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Consensus Estimate?A consensus estimate is an estimate of a company based on the aggregate estimates of analysts about the stocks of securities of a firm. When analysts give estimates of a company’s earnings per share sales and revenue, either...

Dividend Irrelevance Theory – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Dividend Irrelevance Theory?The dividend irrelevance theory was developed by Franco Modigliani and Merton Miller in 1961. This theory maintains that dividend policy does not have an impact on stock’s cost of capital or stock price. The dividend...

Distressed Securities – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

Update Table of Contents What is Distressed Securities?What is a Distressed Security?What Happens to Distressed Securities in Bankruptcy Cases?When Are Securities Considered Distressed? What is Distressed Securities?Distressed securities are securities or financial...

Concentration Ratio (Economics) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What is a Concentration Ratio?In economics, a concentration ratio refers to the ratio of the market shares of a particular company in relation to the entire market size. This ratio also measures the size of a company or firm in comparison to the size of the whole...

Composite (Trading Markets) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Composite?A composite refers to a group of related items or parts of a whole. When similar items are put together, a composite is realized. In the context of securities, a composite refers to a grouping of securities, indexes or other related items. When...

CBOE Volatility Index (VIX) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is the CBOE Volatility Index (VIX)?The CBOE Volatility Index (CBOE VIX) is a measurement of the 30-day expected volatility of the US stock market. This index measures the possible future volatility in the stock market in the period of 30 days. This index was...

Iterated Prisoner’s Dilemma – Explained

by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy

What is an Iterated Prisoner’s DilemmaIn game theory, a prisoner’s dilemma is a situation in a game when two players need to bargain and cooperate to achieve the biggest reward – but they might not do so. When the two players refuse to cooperate,...

Capital Gains Distribution (Managed Funds) – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Capital Gains Distribution?Capital gains distribution refers to an investment payout distributed to investors by the fund’s manager. Capital gains are made of profits realized when securities or stocks in a fund or investment are sold by the manager....