Your Free Online Legal Dictionary • Featuring Black’s Law Dictionary, 2nd Ed.

Category: Finance Dictionary

GOODNESS OF FIT

Warm fuzzy; level of confidence. Degree of comfort that a sample survey’s or test result are reliable for making dependable projections. Described formally as the degree of linear correlation of variables, it

GRADED PREMIUM

The beginning premium of a contract is low and increases over time based on a schedule.

GRANDFATHER CLAUSE

Exemption-allowance statement. Insulates specific entities, object, or situation from the fallout of changes or imposition of a decision. It could be a rule, law, or statute with pre-existing conditions. An example is

GREEKS

RISK measures for DERIVATIVES that are used to determine the price sensitivity of contracts to changes in the UNDERLYING ASSET (DELTA, GAMMA), VOLATILITY (VEGA), passage of time (THETA), and INTEREST RATES (RHO).

GROSS BOOK VALUE

Asset’s original, historical purchase price, depreciation deductions excluded.

GROSS NATIONAL PRODUCT (GNP)

National GDP plus overseas income from in-country companies’ foreign subsidiaries as well as nationals living out of the country.

GROSS SPREAD

The term for gross income in the securities industry. The difference of investor’s purchase cost and issuer’s sale . Underwriter’s fee, issue manager’s fee, and security selling firm discount are all items

GROUP CERTIFICATE

Lists group benefits given to each group plan policyholder. Typically, this is a certificate .

GROWTH STAGE

The third state in a life cycle when revenue raises fast and profits peak. The decline begins after this.

GUIDANCE DOCUMENT

Guidelines written to give broad advise on procedure instead of precise requirements and standards.

HABIT BUYING

Buying the same brand over and over. It is due to lack of negativity rather than loyalty. It involves low involvement products.

HALOGENATED HYDROCARBON

A hydrocarbon with atoms of bromine, chlorine, or flourine from group 17. The production of these hydrocarbons are restricted. AKA halocarbon.

HANGING INDENT

A paragraphy style when the first ile is on the left margin and othes are indented the same space. It is in data lists. AKA outdenting.

HARD METAL

A metallic carbide made of tantalum, titanium, tungsten, and vanadium. It is used in tools or steels. AKA cemented carbide.

HARMONIZED INDEX OF CONSUMER PRICES (HICP)

An INFLATION index widely used throughout the European Union that measures changes in consumer prices. Unlike various other CONSUMER PRICE INDEX measures, HICP excludes owneroccupied rental costs. See also PRODUCER PRICE INDEX,

HEADLINE EFFECT

Stating that negativenews has an effect in companies and economy. It can cause less spending.

HEAT ISLAND EFFECT

A dome that is made over an urban or industrial area. The air is warmer above ground level and traps pollution. It is noticed in the morning and night and leaves mid

HEAVY OIL

A product that remains after the lighter fractions are distilled from crude oil.

HETEROGENEITY

A characteristic of services that show change from one service to another or change in day to day customer service. It is hard to standardize and is the opposite of homogeneity.

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