What Is the Consumer Price Index (CPI)?The Consumer Price Index (CPI) measures the monthly change in prices paid by U.S. consumers. The Bureau of Labor Statistics (BLS) calculates the CPI as a weighted average of prices for a basket of goods and services representative of aggregate U.S. consumer spending. The CPI is one of the most popular measures of inflation and deflation. The CPI report uses a different survey methodology, price samples, and index weights than the producer price index (PP...

What Is Social Responsibility?Social responsibility means that businesses, in addition to maximizing shareholder value, must act in a manner that benefits society. Social responsibility has become increasingly important to investors and consumers who seek investments that are not just profitable but also contribute to the welfare of society and the environment. However, critics argue that the basic nature of business does not consider society as a stakeholder.KEY TAKEAWAYSSocial responsibilit...

What Is a Qualified Institutional Buyer (QIB)?A qualified institutional buyer (QIB) is a class of investor that can safely be assumed to be a sophisticated investor and hence does not require the regulatory protection that the Securities Act's registration provisions give to investors. In broad terms, QIBs are institutional investors that own or manage on a discretionary basis at least $100 million worth of securities. The SEC allows only QIBs to trade Rule 144A securities, which are cer...

What Is Venture Capital (VC)?Venture capital (VC) is a form of private equity and a type of financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential. Venture capital generally comes from well-off investors, investment banks, and any other financial institutions. However, it does not always take a monetary form; it can also be provided in the form of technical or managerial expertise. Venture capital is typically allocated ...

What Are Interpersonal Skills?Interpersonal skills are the behaviors and tactics a person uses to interact with others effectively. In the business world, the term refers to an employee's ability to work well with others. Interpersonal skills range from communication and listening to attitude and deportment.KEY TAKEAWAYSInterpersonal skills help us interact with others effectively, on the job, and in the larger world.Some people are born with such skills but everyone can improve them wit...

What Is a Venture Capitalist (VC)?A venture capitalist (VC) is a private equity investor that provides capital to companies with high growth potential in exchange for an equity stake. This could be funding startup ventures or supporting small companies that wish to expand but do not have access to equities markets.KEY TAKEAWAYSA venture capitalist (VC) is an investor that provides young companies with capital in exchange for equity.New companies often turn to VCs for the funding to scale and ...

What Is the DuPont Analysis?The DuPont analysis (also known as the DuPont identity or DuPont model) is a framework for analyzing fundamental performance popularized by the DuPont Corporation. DuPont analysis is a useful technique used to decompose the different drivers of return on equity (ROE). The decomposition of ROE allows investors to focus on the key metrics of financial performance individually to identify strengths and weaknesses.KEY TAKEAWAYSThe DuPont analysis is a framework for ana...

What Is the Yankee Market?"Yankee market" is a slang term for the stock market in the United States. Yankee market is usually used by non-U.S. residents and refers to the slang term for an American, a Yankee (or Yank), which itself is sometimes used as a playful, though sometimes derogatory, reference to U.S. citizens."Yankee market" is a slang term for the stock market in the United States.Relatedly, a Yankee bond is one issued by a foreign bank or company but traded in the United States and...

What Is Netting?Netting entails offsetting the value of multiple positions or payments due to be exchanged between two or more parties. It can be used to determine which party is owed remuneration in a multiparty agreement. Netting is a general concept that has a number of more specific uses, including in the financial markets.KEY TAKEAWAYSNetting offsets the value of multiple positions or payments due to be exchanged between two or more parties.Netting is used in a number of settings and ins...

Definition of KurtosisLike skewness, kurtosis is a statistical measure that is used to describe distribution. Whereas skewness differentiates extreme values in one versus the other tail, kurtosis measures extreme values in either tail. Distributions with large kurtosis exhibit tail data exceeding the tails of the normal distribution (e.g., five or more standard deviations from the mean). Distributions with low kurtosis exhibit tail data that are generally less extreme than the tails of the no...

What Is a Bill of Lading?A bill of lading (BL or BoL) is a legal document issued by a carrier to a shipper that details the type, quantity, and destination of the goods being carried. A bill of lading also serves as a shipment receipt when the carrier delivers the goods at a predetermined destination. This document must accompany the shipped products, no matter the form of transportation, and must be signed by an authorized representative from the carrier, shipper, and receiver.KEY TAKEAWAYSA...

What Is the Goods and Services Tax (GST)?The goods and services tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services.KEY TAKEAWAYSThe goods and services tax (GST) is a tax on goods and services sold domestically for consumption.The tax is included in the final price and paid by consumers at point of sale and passed to the government by ...