In finance, diversification means reducing risk by investing in a variety of assets. If the asset values do not move up and down in perfect synchrony, a diversified portfolio will have less risk than the weighted average risk of its...

Compound interest arises when interest is added to the principal, so that, from that moment on, the interest that has been added also earns interest. This addition of interest to the principal is called compounding. A bank account, for example,...

Saving accounts are accounts maintained by retail financial institutions that pay interest but cannot be used directly as money in the narrow sense of a medium of exchange (for example, by writing a cheque). These accounts let customers set aside...

A mutual fund is a type of professionally managed collective investment vehicle that pools money from many investors to purchase securities. While there is no legal definition of the term "mutual fund", it is most commonly applied only to those...

In mathematics, a rate is a ratio between two measurements with different units. If the unit or quantity in respect of which something is changing is not specified, usually the rate is per unit time. However, a rate of change...

In banking and accountancy, the outstanding balance is the amount of money owed, (or due), that remains in a deposit account (or a loan account) at a given date, after all past remittances, payments and withdrawal have been accounted for....

Accounting is a systematic way to record transactions. An account refers to assets, liabilities, income, expenses, and equity, as represented by individual ledger pages, to which changes in value are chronologically recorded with debit and credit entries. These entries, referred...