What Is a NINJA Loan?A NINJA loan is a slang term for a loan extended to a borrower with little or no attempt by the lender to verify the applicant's ability to repay. It stands for "no income, no job, and no assets." Whereas most lenders require loan applicants to provide evidence of a stable stream of income or sufficient collateral, a NINJA loan ignores that verification process. NINJA loans were more common prior to the 2008 financial crisis. In the aftermath of the crisis, the U.S. ...

What Is a NINJA Loan?A NINJA loan is a slang term for a loan extended to a borrower with little or no attempt by the lender to verify the applicant's ability to repay. It stands for "no income, no job, and no assets." Whereas most lenders require loan applicants to provide evidence of a stable stream of income or sufficient collateral, a NINJA loan ignores that verification process. NINJA loans were more common prior to the 2008 financial crisis. In the aftermath of the crisis, the U.S. ...

What Is a Chief Executive Officer (CEO)?A chief executive officer (CEO) is the highest-ranking executive in a company. Broadly speaking, a chief executive officer’s primary responsibilities include making major corporate decisions, managing the overall operations and resources of a company, acting as the main point of communication between the board of directors and corporate operations. In many cases, the chief executive officer serves as the public face of the company. The CEO is elected by...

What Is a Chief Executive Officer (CEO)?A chief executive officer (CEO) is the highest-ranking executive in a company. Broadly speaking, a chief executive officer’s primary responsibilities include making major corporate decisions, managing the overall operations and resources of a company, acting as the main point of communication between the board of directors and corporate operations. In many cases, the chief executive officer serves as the public face of the company. The CEO is elected by...

What Is Technical Analysis?Technical analysis is a trading discipline employed to evaluate investments and identify trading opportunities by analyzing statistical trends gathered from trading activity, such as price movement and volume. Unlike fundamental analysis, which attempts to evaluate a security's value based on business results such as sales and earnings, technical analysis focuses on the study of price and volume.KEY TAKEAWAYSTechnical analysis is a trading discipline employed t...

What Is Technical Analysis?Technical analysis is a trading discipline employed to evaluate investments and identify trading opportunities by analyzing statistical trends gathered from trading activity, such as price movement and volume. Unlike fundamental analysis, which attempts to evaluate a security's value based on business results such as sales and earnings, technical analysis focuses on the study of price and volume.KEY TAKEAWAYSTechnical analysis is a trading discipline employed t...

What Are Zombies?Zombies are companies that earn just enough money to continue operating and service debt but are unable to pay off their debt. Such companies, given that they just scrape by meeting overheads (wages, rent, interest payments on debt, for example), have no excess capital to invest to spur growth. Zombie companies are typically subject to higher borrowing costs and may be one just event—market disruption or a poor quarter performance—away from insolvency or a bailout. Zombies ar...

What Are Zombies?Zombies are companies that earn just enough money to continue operating and service debt but are unable to pay off their debt. Such companies, given that they just scrape by meeting overheads (wages, rent, interest payments on debt, for example), have no excess capital to invest to spur growth. Zombie companies are typically subject to higher borrowing costs and may be one just event—market disruption or a poor quarter performance—away from insolvency or a bailout. Zombies ar...

What Is the Herfindahl-Hirschman Index (HHI)?The Herfindahl-Hirschman Index (HHI) is a common measure of market concentration and is used to determine market competitiveness, often pre- and post-merger & acquisition (M&A) transactions.KEY TAKEAWAYSThe Herfindahl-Hirschman Index (HHI) is used to determine market competitiveness.A market with an HHI of less than 1,500 is considered a competitive marketplace, an HHI of 1,500 to 2,500 is moderately concentrated, and an HHI of 2,500 or greater is ...

What Is the Herfindahl-Hirschman Index (HHI)?The Herfindahl-Hirschman Index (HHI) is a common measure of market concentration and is used to determine market competitiveness, often pre- and post-merger & acquisition (M&A) transactions.KEY TAKEAWAYSThe Herfindahl-Hirschman Index (HHI) is used to determine market competitiveness.A market with an HHI of less than 1,500 is considered a competitive marketplace, an HHI of 1,500 to 2,500 is moderately concentrated, and an HHI of 2,500 or greater is ...

What Is the Geometric Mean?The geometric mean is the average of a set of products, the calculation of which is commonly used to determine the performance results of an investment or portfolio. It is technically defined as "the nth root product of n numbers." The geometric mean must be used when working with percentages, which are derived from values, while the standard arithmetic mean works with the values themselves.KEY TAKEAWAYSThe geometric mean is the average rate of return of a set of va...

What Is the Geometric Mean?The geometric mean is the average of a set of products, the calculation of which is commonly used to determine the performance results of an investment or portfolio. It is technically defined as "the nth root product of n numbers." The geometric mean must be used when working with percentages, which are derived from values, while the standard arithmetic mean works with the values themselves.KEY TAKEAWAYSThe geometric mean is the average rate of return of a set of va...

What Is the 11th District Cost of Funds Index?The 11th District Cost of Funds Index (COFI) is a monthly weighted average of the interest rates paid on checking and savings accounts offered by financial institutions operating in Arizona, California, and Nevada. It is one of many indices used by mortgage lenders to adjust the interest rate on adjustable rate mortgages (ARM) and was launched in 1981. With an ARM mortgage, the interest rate on a mortgage moves up and down along with some standard...

What Is the 11th District Cost of Funds Index?The 11th District Cost of Funds Index (COFI) is a monthly weighted average of the interest rates paid on checking and savings accounts offered by financial institutions operating in Arizona, California, and Nevada. It is one of many indices used by mortgage lenders to adjust the interest rate on adjustable rate mortgages (ARM) and was launched in 1981. With an ARM mortgage, the interest rate on a mortgage moves up and down along with some standard...

What Is Mutually Exclusive?Mutually exclusive is a statistical term describing two or more events that cannot happen simultaneously. It is commonly used to describe a situation where the occurrence of one outcome supersedes the other. For example, war and peace cannot coexist at the same time. This makes them mutually exclusive.KEY TAKEAWAYSEvents are considered to be mutually exclusive when they cannot happen at the same time.The concept often comes up in the business world in the assessment...

What Is Mutually Exclusive?Mutually exclusive is a statistical term describing two or more events that cannot happen simultaneously. It is commonly used to describe a situation where the occurrence of one outcome supersedes the other. For example, war and peace cannot coexist at the same time. This makes them mutually exclusive.KEY TAKEAWAYSEvents are considered to be mutually exclusive when they cannot happen at the same time.The concept often comes up in the business world in the assessment...

What Is Pro Rata?Pro rata is a Latin term used to describe a proportionate allocation. It essentially translates to "in proportion," which means a process where whatever is being allocated will be distributed in equal portions. If something is given out to people on a pro rata basis, it means assigning an amount to one person according to their share of the whole. While a pro rata calculation can be used to determine the appropriate portions of any given whole, it is often used in business fi...

What Is Pro Rata?Pro rata is a Latin term used to describe a proportionate allocation. It essentially translates to "in proportion," which means a process where whatever is being allocated will be distributed in equal portions. If something is given out to people on a pro rata basis, it means assigning an amount to one person according to their share of the whole. While a pro rata calculation can be used to determine the appropriate portions of any given whole, it is often used in business fi...

Understanding Joint and Several LiabilityJoint and several liability favors the plaintiff suing for damages because it empowers them to pursue full payment, if necessary, from the party with the deepest pockets if the others named cannot pay. If all of the parties involved are insolvent and uninsured, the plaintiff collects nothing. Joint and several liability differs in law from comparative fault, in which multiple parties are assigned responsibility for a portion of the damages in relation ...

Understanding Joint and Several LiabilityJoint and several liability favors the plaintiff suing for damages because it empowers them to pursue full payment, if necessary, from the party with the deepest pockets if the others named cannot pay. If all of the parties involved are insolvent and uninsured, the plaintiff collects nothing. Joint and several liability differs in law from comparative fault, in which multiple parties are assigned responsibility for a portion of the damages in relation ...