The Most Comprehensive Financial Dictionary with over 1000 Financial Terms Explained - Clear and Concise Article Style Description with Practical Examples
Financial Words Starting with S 2017-08-15T10:46:56+00:00
S Corporation
S Corporation refers to the Subchapter S Corporation type of company filing which measures up to certain requirements set by the IRS Internal Revenue Service. This status provides a corporation which possesses a hundred or fewer shareholders all of the advantages of incorporation while also keeping the benefits of only being tax treated like a partnership. One of the many [...]
S&P 500 Index
The S&P 500 Index refers to a world famous American stock market index. It is comprised of 500 stocks today which analysts and investors view to be the leading indicator for American stocks and equities. They call this the mirror of the large cap world performance. Economists are the ones who select the components of the S&P 500. The S&P [...]
S&P Global Market Intelligence
S&P Global Market Intelligence is the new name for the once independent financial and news service provider SNL Financial. This outfit is now one of several divisions of S&P Global. The purpose of all of the work done at S&P Global Market Intelligence is to put its myriads of high quality data to best use. Customers are able to access [...]
Salary
Salary refers to the monetary component of a job’s arrangements. Companies provide this as compensation for employees delivering specific services in their capacity on the job. The figure usually pertains to the amount of money the employees receive for a year’s worth of work. It is also the amount of money which the workers earn in regular pay intervals, such [...]
Sale And Leaseback
A Sale And Leaseback is also known as a simply leaseback. This arrangement involves an asset seller who first sells the asset or property in question then immediately leases it back exactly as it is from the buyer. These types of deals are fleshed out and contracted immediately following the asset in question’s sale. The precise amount in payments and [...]
Sales Tax
Sales Tax refers to a government imposed tax on consumption of both services and goods. Traditional sales taxes are collected at the appropriate points of sale. The retailers gather the money which they then pass on to the appropriate governmental agency. Businesses are also liable to pay such sales taxes to the relevant jurisdiction (state or local government) if they [...]
Salvage Value
Salvage value refers to a value calculation for assets. It proves to be the estimated value for reselling assets at the conclusion of their natural and useful lives. The value is important because analysts subtract it out of the fixed assets’ original costs to learn what part of this cost may be depreciated for accounting and taxation purposes. This explains [...]
Sarbanes-Oxley Act of 2002
The Sarbanes-Oxley Act of 2002 is also properly called the Public Company Accounting Reform and Investor Protection Act of 2002. It is more typically referred to by its abbreviation SarbOx or even SOX. Congress passed this much needed reforming federal law of the United States because of a variety of significant accounting and corporate scandals that successively rocked the nation. [...]
SARSEP
SARSEP is an acronym that means Salary Reduction Simplified Employee Pension Plan. The government offered this advantageous retirement vehicle to those small businesses which possessed fewer than 26 employees. With this SARSEP, employees receive their own SEP IRA account in their specific individual name. They and their employers can both make contributions to the accounts. These accounts are interesting primarily [...]
Savings and Loan Crisis
The most significant collapse of banks since the Great Depression in 1929 became the Savings and Loan Crisis of 1989. In 1989, over a thousand of the Savings and Loans in the country had collapsed. This brought to a close a route that had long been a secure means for obtaining home mortgages. It turned out that half of the [...]
SDR Denominated Bonds
SDR denominated bonds are a fairly recent phenomenon. These are bonds issued in special drawing rights currency units. SDR units are a basket of the world’s most important currencies including the U.S. dollar, Euro zone euro, Japanese Yen, British pound sterling, and the Chinese Yuan. The International Monetary Fund’s executive board approved a framework to issue such bonds to member [...]
Secondary Market
The secondary market refers to that securities trading market in which investors are able to purchase and sell securities that they own. Most individuals would simply call this the stock market. It is also true that stocks are additionally sold on the primary market at their first time and point of issue. Secondary markets in the United States include the [...]
Secretary of the Treasury
The Secretary of the Treasury is a cabinet level post in the Federal Government of the United States. This important individual bears many significant responsibilities for the country. Treasury secretaries must create and recommend both international and domestic economics, financial, and tax policies to the President of the United States. The Secretary is also expected to actively participate in creating [...]
Securities
Securities refer to financial instruments which stand for a position of ownership in a corporation which is publically traded. These would be stock shares. They could also be a creditor-like relationship to a corporation or a government entity or agency. This security would be called a bond. They might also be an option, which is the right but not obligation [...]
Securities and Exchange Commission (SEC)
The SEC is the acronym for the Securities and Exchange Commission. This Federal government agency actually governs the buying and selling of stock securities and other types of related investments. The SEC also works to safe guard investors against impropriety and fraud. They encourage the development of the market with the end goal of keeping America in the first place [...]
Securities Exchange Act of 1933
The Securities Exchange Act of 1933 became sponsored and passed because of the devastating stock market crash which happened on and following Black Monday in 1929. The administration and Congress had two principle goals with this piece of legislation. These were to make certain a greater amount of transparency would exist with financial statements so that investors could engage in [...]
Securities Exchange Act of 1934
The Securities Exchange Act of 1934 is also known by its acronym of SEA. This piece of legislation was crafted in order to regulate transactions in securities which trade on the secondary market after they are already issued. The goal of this is to guarantee a higher level of financial transparency, better accuracy of trades, and a lower degree of [...]
Securities Markets
Securities Markets refer to either literal physical or virtual online places for traders and investors to buy and sell securities. These markets have been dramatically changing in the last several decades in order to best meet the requirements and wishes of investors and traders alike. Traders must have such markets which are easy to access, highly liquid, and that levy [...]
Securitization
Securitization is a financial engineering procedure. In this process, sponsors take an asset or group of assets that is illiquid and turn them into a saleable security. Mortgage backed securities are common instruments that result from securitization. These MBS products are backed by assets. The security that underlies them are a group of mortgages. The securitization process works in a [...]
Seed Money
Seed Money refers to that capital which someone delivers to a business, initiative, or project at the beginning in order to get it started. This money is intended to be the seed that helps the upcoming project or company to grow and flourish. Offering such early stage funds can prove to be extremely risky. The project could completely fail, which [...]
Self Directed IRA
Self directed IRAs prove to be special kinds of individual retirement accounts. They are different from traditional IRAs because they provide the account holder with a significantly greater variety of investment choices and control over decisions on the account. With these types of IRAs, the owner or an investment advisor makes a variety of investment decisions. They then deliver these [...]
Seller Financing
Seller Financing turns out to be a loan that a business or property seller offers to the buyer. When seller financing is provided, the buyer generally gives a down payment amount to the seller. The balance of the purchase price is paid to them using installment payments that are typically monthly. This is accomplished at a certain time of the [...]
Selling Short
Selling short, or short selling, is a strategy used in trading stocks. In the selling short process, you borrow the shares of the stock in question from your stock broker. You then turn around and sell the stock shares borrowed for a certain price that the market offers. Your hope is that the price of the stock will drop, so [...]
SEP IRA
SEP IRAs are special simplified employee pensions that permit employers to contribute money to the retirement plans of their employees. If individuals are self employed, they may also set up and fund one of these accounts for their own benefit. These plans compare favorably to the more popular and utilized 401(k) plan. SEPs offer greater contribution amount limits. They are [...]
Sequestration
Sequestration refers to the package of cuts to the Federal government’s budget which became effective on March 1st of 2013. More precisely, the phrase pertained to the method of budgeting in which the drastic cuts would be put into place. The sequester, or super committee sequestration as it was fully known, also extended beyond 2013 from 2014 to 2021. Congress [...]
Seven Sisters Oil Companies
Seven Sisters Oil Companies is a phrase that was made famous by Italian state oil Company ENI Chief and Italian businessmen Enrico Mattei back in the 1950s. Mattei used this phrase disparagingly, which he coined in order to refer to the seven Anglo-American oil companies that had formed the “Consortium for Iran” cartel. They became so powerful that they soon [...]
Share Consolidation
Share Consolidation refers to a reverse split. In this corporate operation, a number of shares of stock become merged together into only one single share. These share consolidations can take place either in the forms of reverse stock splits or as stock share funded buyouts. With reverse stock splits, the corporation simply decreases the quantity of shares of its own [...]
Share Repurchase
Share Repurchase refers to a company program where the corporation purchases back some of its own shares off of the stock markets or from its own individual investors. There are various reasons why a company would choose to spend its excess profits or cash reserves on such an activity. Generally management believes the price of the stock is unfairly undervalued. [...]
Shareholder Value
Shareholder Value refers to the value of a company which stakeholders in the firm enjoy as a direct result of management growing revenues, earnings, and free flow cash in time. The actual value of any company comes down to the effects and results of the strategic choices that senior management makes and carries out for a firm. This includes both [...]
Shareholders
Shareholders are companies, people, or institutions which own minimally a single share of the stock in a given company. They can also be referred to as stockholders. These stockholders are not only investors, but also the owners of the corporation. As owners, they gain the advantageous results from the firm’s success. This can translate into higher stock prices, dividend payouts, [...]
Shares Outstanding
The Shares Outstanding refers to the quantity of shares in a given company’s stock which are presently owned by all of the shareholders in total. This also includes the larger share blocks owned by the institutional investors. It also encompasses the company officers’ and insider shares which are restricted ones. Every corporate balance sheet will display this number under the [...]
Sharpe Ratio
Sharpe Ratio refers to a means of calculating returns which are risk-adjusted. This particular ratio has grown into the standard in the investment industry for these types of compilations. Nobel laureate William F. Sharpe originally created and popularized it. It represents the average return which investments earn above the risk free rate per unit of volatility. It is also the [...]
Sherman Clayton Antitrust Acts
The Sherman Act and Clayton Act are two pieces of legislation which Congress designed to combat abusive trusts and monopolies. Over the years they have been utilized to break up certain large monopolistic enterprises. Their passage also led to the creation of the anti-trust division in the Department of Justice. In 1890 Congress passed its Sherman Antitrust Act. Though it [...]
Short Sale
Short sales are real estate sales where the money received from the sale is not sufficient to cover the balance that is owed on the property loan. This commonly happens as a result of borrowers being unable to keep up with the mortgage payments for their home loan. In this case, the bank or other lending institution will likely determine [...]
Short Squeeze
A short squeeze relates to a scenario where a traded stock or commodity which has been heavily shorted suddenly moves aggressively higher without advance warning. This creates a self-fulfilling prophecy in which the short sellers feel so painful a loss that they are forced to close out their shorted positions. They actually increase the upward momentum and pressure on the [...]
Simple IRA
Among the stable of various types of IRAs American savers for retirement can take advantage of is a less common plan called the SIMPLE IRA. These kinds are a combination of traditional IRAs and employer offered plans like 401(k)s. The word SIMPLE in this case is actually an acronym that stands for Savings Incentive Match Plan for Employees. This is [...]
Small Business
Small Business refers to any company that has a maximum of 500 employees, per the definition set by the United States’ own SBA Small Business Administration. According to this definition of small business, the majority of companies within the United States are actually small businesses. SBA states that 99.7 percent of the around six million U.S.-based business with employees fall [...]
Social Security
Social Security in the United States refers to the federal government’s OASDI Old Age, Survivors, and Disability Insurance program. President Franklin Roosevelt created the first such program and signed the Social Security Act legislation in 1935. The present day law has been amended to include other social insurance and social welfare schemes. The Social Security program is mostly bankrolled using [...]
Societe Generale
Societe Generale is a French banking giant that proves to be among the largest financial services companies in Europe. As of 2015, it boasted 31 million customers living in 66 countries where they have branches. A staff of 146,000 employees works for the bank and comes from 122 different nations. The bank counts 31 million customers that include private individuals, [...]
Solo 401(k) Plan
Solo 401(k) plans function much as their standard 401(k) plan cousins do, but display some important differences. These retirement savings plan vehicles for the self employed are also called One Participant 401(k)s, Self Employed 401(k)s, Individual 401(k)s, and Uni-Ks. These particular 401(k)s provide business owners and spouses who do not have any employees beyond themselves with the ability to be [...]
Sovereign Debt
Sovereign Debt refers to the amount of money which the government of a given nation owes its various domestic and foreign creditors. It is a synonym to country debt, national debt, or government debt since the word sovereign simply equates to an independent national government. Another way of thinking of this term is that it is the amount of money [...]
Sovereign Wealth Funds
Sovereign Wealth Funds are investment pools made up of foreign capital and currency reserves which the government of the country in question owns. The biggest such pools of investment belong to the few countries with a large trade surplus in their economies. This means that Norway, Singapore, the oil producing and exporting nations, and China are the principle sovereign wealth [...]
Special Drawing Rights (SDR)
Special Drawing Rights are currency units of the International Monetary Fund. These units were originally worth .888671 grams of gold and $1 when they were initially created under the gold standard in 1969. In 1973 the pegged currency system set up at the Bretton Woods conference collapsed. The IMF then re-defined these SDRs as a basket of the major world [...]
Stagflation
Stagflation refers to the simultaneous problems of high unemployment, stagnated economic growth, and persistently high inflation. It is an unlikely scenario, as slowing economies typically reduce demand sufficiently in order to keep higher prices in check. When workers lose their jobs, they purchase less. Businesses are then usually forced to reduce their prices in order to convince remaining customers to [...]
Standard and Poor's (S&P)
Standard and Poor’s is a global ratings agency that is also responsible for the S&P and Dow Jones indices in the stock market. Besides providing ratings on companies and products, they also rate governments’ sovereign credit ratings. This company is based in the United States but has 26 offices throughout the globe. The corporation has shortened its name from Standard [...]
Standard Deduction
A Standard Deduction refers to the minimum amount of income which will not be subjected to taxes. This deduction may also be utilized to decrease the AGI adjusted gross income of the tax payer in question. Such standard deductions are only allowed to be employed in cases where the tax paying individual elects to skip the itemized deductions for figuring [...]
Statistical Arbitrage
Statistical arbitrage turns out to be a scenario where a disparity in price exists between the natural price of an asset, or its inherent value, and the current market price. There are traders who specialize in arbitrage situations who will try to gain advantage from this fairly unusual situation of disparity hoping to profit from it as it naturally corrects. [...]
Stock Broker
Stock brokers are professionals who are both licensed and registered with the Financial Industry Regulatory Authority or FINRA. In general, stockbrokers work for a broker dealer or a stock brokerage firm. Stock brokers are not to be confused with financial advisors or financial planners, who perform many different services for their clients. Stock brokers have a primary responsibility. Their job [...]
Stock Buybacks
Stock buybacks occur when companies repurchase their own company shares from the markets. They are sometimes called share repurchases. A buyback is like a company choosing to invest in itself, since it is actually employing its own cash reserve to purchase its own stock. Companies may not be shareholders in themselves, which means that their shares are absorbed back into [...]
Stock Market Index
A stock market index refers to a collection of stocks which are combined together to create a bellwether for a group of similar companies in the market. The idea is to present an index which tracks a certain sector, market, currency, commodity, bond, or other type of financial asset. Stocks which are collected in such an index are put into [...]
Stock Split
Stock splits occur when corporations decide to expand the number of underlying shares in the company. They do this by setting out a ratio for the stock split. They might say that for every one share of stock, there will now be two, which would double your existing shares. This would be called a two to one stock split. If [...]
Stocks
Stocks are financial instruments that are issued by publicly traded corporations. These shares of stocks prove to be the tiniest portion of ownership that you can acquire in a company. Even by owning a single share of a company’s stock you are a small part owner of the firm. Owning shares of stock gives you the privilege of voting for [...]
Straddle
A straddle is a a type of option strategy which is designed to assist traders in succeeding in markets that are either neutral or aggressively breaking out to one side or the other. While there are other similar result strategies that are both sophisticated and extremely complex like iron butterflies and iron condors, straddles are among the least difficult to [...]
Strangle
A strangle is a strategy in which traders buy or sell calls and puts which are very slightly out of the money at the same time. They must have the same expiration dates but typically have different strike prices. The long version of this strategy provides a limited amount of risk and unlimited profit potential. It makes money if the [...]
Strategy
Where businesses are concerned, strategy proves to be both the scope and direction that a business pursues over a longer term time frame. Strategy gains a business or other organization advantages through optimally deploying and utilizing all types of resources in competitive environments. Strategy is utilized to fulfill the needs that markets experience and to live up to the expectations [...]
Structured Finance
Structured Finance refers to the possibility of and procedures for issuing loans because of a reliable history of strong corporate cash flow. Instead of using assets for a loan’s collateral, the funds are given out based upon the past history that shows a consistent cash flow in the business of the borrower. This cash flow will provide for the orderly [...]
Sub-prime Borrower
A sub-prime borrower is an individual who has credit that is considered to be less than perfect. This is the opposite of a prime borrower. Bankers call prime borrowers those who possess higher and better credit scores, low debt ratios, and significant incomes which are more than enough to cover their monthly bills and expenses. Sub-prime borrowers often are only [...]
Sub-prime Lender
A sub-prime lender makes loans to customers who fall into the sub-prime borrower category. These products often include loans which are normally considered to be standard. They are structured for and marketed to borrowers who possess inadequate income, lower credit scores, and a higher debt to income ratio. These borrowers can not qualify with lenders regarded as traditional. Sub-prime lenders [...]
Sub-prime Mortgage
A sub-prime mortgage is one where the home loan that the bank or lending institution makes is offered to the category of consumers who are considered to possess the riskiest credit. Sub prime mortgages are actually sold on a different market than are prime mortgage loans. Sub prime mortgage borrowers are determined through a combination of factors, such as the [...]
Sub-prime Mortgage Crisis
The sub-prime mortgage crisis proves to be a still going financial and real estate crisis. It continues to revolve around the steep decline that you saw in American housing prices, the resulting increase in numbers of mortgage delinquencies and finally foreclosures, and the ultimate fall of securities that are backed up by these sub-prime mortgages. The problems began with the [...]
Subordinate Financing
Subordinate financing refers to that type of debt finance which ranks behind the primary finance. It is second in importance and position to debt that senior or secured lenders hold. This is important when a default occurs, as it determines who gets repaid first from any bankruptcy proceedings or foreclosure. The term signifies that senior lenders who are secured will [...]
Subordinated Debt
Subordinated Debt refers to a security or alternatively a loan which has a lower ranking to other debt securities and loans. This pertains to the claims on a corporation’s earnings or assets in the event of repayment default. Analysts also call this a subordinated loan or a junior security alternatively. When the borrower defaults on the loan or security in [...]
Subsidies
Subsidies are types of financial support or aid which a government or organization extends out to an economic industry, institution, individual, or business. These are done for the purpose of fostering particular economic or even social policies. The government is the most common provider of this type of assistance, but such support can also come from Non Governmental Organizations. Such [...]
Supplemental Security Income
Supplemental Security Income refers to the emergency measure benefits for retirement that are provided to working Americans by the government to help cushion their golden years. For those retirees whose regular social security check amount is insufficient to provide for their basic retirement needs, the government set up an additional sum of money provided monthly that is called Supplemental Security [...]
Supply and Demand
Supply and Demand refers to a law that attempts to explain the interaction between the forces involving a resource or good’s demand and available supply. It is this law that determines how much of a given product will be supplied and demanded at a certain price. When supply is low and demand is high, price tends to go up, while [...]
Swap
A Swap refers to a particular derivative contract. They allow for two opposite parties to exchange certain types of financial instruments as the name quite literally implies. While in theory the instruments involved in such an exchange could be practically anything, in reality the majority of them prove to deal with cash flows on a principal amount with which the [...]
SWIFT
SWIFT Network is the internationally relied upon system for transferring money. It underlies the overwhelming majority of security and international money transfers. This vast network for financial messaging is employed by financial institutions such as banks to rapidly, securely, and accurately receive and send information that includes instructions for money transfers. In any given day, almost 10,000 different member institutions [...]
Swing Trading
Swing trading refers to a wide range of shorter time frame trading strategies used in the stock market. Once a purview of only wealthy or professional full time traders this form of trading has become far more broad-based and accessible to regular investors. This is thanks to the vast proliferation over the past few years of the Internet revolution, an [...]
Swiss Banking
Swiss Banking is unusually concentrated into two main banks. These are UBS and Credit Suisse. Together they control an enormous amount of the accounts and assets in all of Switzerland. The Swiss Banking tradition used to be shrouded in secrecy. Under the administration of American President Obama, many Swiss banks were investigated and charged with helping Americans to illegally evade [...]
Swiss Interbank Clearing (SIC)
Swiss Interbank Clearing is the interbank clearing system that Switzerland uses for payments within the country and between its banks. SIX Interbank Clearing Limited launched the system on June 10, 1987. They have been operating it since then for the Swiss National Bank. The primary eligible users of the SIC are all of the Swiss banks along with German Post [...]
Swiss National Bank (SNB)
The Swiss National Bank is one of the important central banks of the world. It carries out its monetary policies and other roles independently of the government of Switzerland. In 2007, the SNB celebrated its one hundred year anniversary from its founding in 1907. Switzerland’s central bank has a wider mandate than some other national central banks do. The mandate [...]
Syndicated Loan
Syndicated Loan refers to a special type of loan which a group of lenders provides to a borrower. It is also called a syndicated bank facility. The lending group that works in concert is known as a syndicate. Their mission is to pool their resources in order to offer funds to single individual borrowers. The borrower does not have to [...]
Systemic Risk
Systemic Risk refers to those dangers that threaten the entire financial sector, another segment of the market, or the entire market. Analysts and economists also call this volatility, “undiversifiable” risk, and market risk. Such risk is especially dangerous because it can not be entirely avoided nor accurately predicted or forecast. There is no practical way to mitigate such risks to [...]