FINANCIAL TERMS AND CONCEPTS - 03

FINANCIAL TERMS AND CONCEPTS - 03

51. Bequest:  Something, usually property, given in a will.

52. BIC :  Bank Identifier Code – a unique address which, in telecommunication messages, identifies precisely the financial institutions involved in financial transactions.

53. Bid/offer spread:  An initial investment charge that refers to the difference between the buying and selling price of a unit on the stock market on any given day.

54. Bid price:  The price that an investor in a unit trust can get for each unit if they cash them in.

55. Bond:  A written promise made by governments and companies to repay any money borrowed, with interest, on a certain date in the future.

56. Bonus issue:  An offer of free shares to a company’s shareholders, related to the number of shares they already have.

57. Book value:  The value of a fixed asset, such as a building or machine, after depreciation, as recorded in an organisation’s accounts.

58. Books of account:  Books that a business must keep to record its financial transactions accurately.

59. Booking fee:  An amount a person pays to book something, for example a concert or plane ticket, to cover a company’s administrative costs.

60. Borrow:  Get money that will be paid back.

61. Bounced cheque:  A cheque that the bank refuses to pay out because the person who wrote the cheque does not have enough money in their account to pay for it.

62. Breach of contract:  An act that breaks a legal duty agreed in a contract.

63. Break even:  A point at which a company earns as much money as it is spending; with no profit or loss, it ‘breaks even’.

64. Bridging loan :  A loan given by a lending institution to ‘bridge’ a time difference between buying a new home and selling the existing home.

65. Brokerage:   Commission earned by a broker or a broker’s business.

66. Budget:  A plan of spending over a certain length of time, based on how much money a person has

67. Budget deficit :  A gap that occurs when a body, often a government, plans to spend more money than it takes in.

68. Building society:   An organization owned by its members, who are some or all of the customers saving with or borrowing from the society.

69. Buildings insurance:  An insurance policy that pays out if a person’s home is damaged, for example if tiles fall off a roof during a storm.

70. Bull:  Someone who buys shares now, expecting that their value will rise in the future so that they can sell the shares for a profit at a later date.

71. Bureau de change:  A place that changes all major foreign currencies, in cash or in travellers’ cheques, for a fee known as a commission.

72. Calendar month:  A period of time that starts on the first day of the month and ends on the last day, as opposed to starting in the middle of one month and ending in the middle of the next.

73.Cancellation rights:  A person’s or company’s right to cancel a contract.

74. Capital:  An amount of money a person saves, invests or borrows, before interest or loss.

75. Capital charge:  A charge that a unit trust manager takes out of the fund’s capital rather than out of the income it has generated.