Investment Terms

Polar Vortex

Polar Vortex: An area of low pressure in the upper atmosphere near both of the Earth’s geographical poles. In the winter of 2014, the regular polar vortex experienced a breakdown and a large part of the vortex was forced southward. Eventually the cold air in Canada and the mild temperatures in the United States merged which led to extreme wind chills and record cold temperatures in the central, southern and eastern parts of the United States.

Source: Wikipedia, Weather Underground


Tapering: Prior to May of 2013, “tapering” was a term most commonly heard in athletics training. On May 22, U.S. Federal Reserve Chairman Ben Bernanke stated in testimony before Congress that that Fed may “taper” the bond-buying program, called quantitative easing (QE), in the coming months. The expectation in 2013 is that the Fed will gradually bring its current pace of $85 billion per month in bond purchases to zero by the middle half of 2014.


10-Year Treasury

10-Year Treasury: a long term debt obligation that matures in 10 years; issued by the United States government. Interest is paid on a semi-annual basis and, at maturity the face value of the note is paid out to the holder. Treasury notes are state and local tax-exempt but are still taxable at the federal level. Treasury notes are also available in two, three, five and seven-year terms.

Source: Investopedia

The Affordable Care Act (ACA)

The Affordable Care Act (ACA): An informal term for the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010—legislation promoted by President Barack Obama that changed how health insurance functions in the U.S. The ACA expanded eligibility of Medicaid and required most Americans to purchase health insurance. It also set up exchanges in several states so insurers could compete to provide the most cost-effective options for consumers.

Source: The Free Dictionary


Annuity: An annuity is a contract between a consumer and an insurance company that requires the insurer to make payments to the consumer, either immediately or in the future. The consumer buys an annuity by making either a single payment or a series of payments. Similarly, the payout may come either as one lump-sum payment or as a series of payments over time.

Source: and Investopedia

Beige Book

Beige Book: The informal, commonly used name for the ongoing Fed reports titled, The Summary of Commentary on Current Economic Conditions, by Federal Reserve District. Published eight times a year just before each Federal Open Market Committee meeting on interest rates, this report is used to inform members of the committee on changes in the economy since the last meeting.

How the Beige Book is compiled: Each of the twelve Federal Reserve Banks gathers anecdotal information on current economic conditions in its district. Anecdotal information comes in such forms as reports from bank and branch directors, interviews with key business contacts, economists, market experts and other sources. The information summarized in the Beige Book is organized by district and sector.

Significance of the Beige Book for the Federal Open Market Committee: The primary goal of FOMC meetings is to establish a target Federal Funds rate. FOMC members also receive economic forecasts (the Green Book) and an analysis of monetary policy alternatives (the Blue Book), but the Beige Book is the only of these reports made available to the public. Often eagerly awaited by investors and economists, the Beige Book has a considerable impact on the potential actions the FOMC may take at its next meeting. The Beige Book is made public approximately two weeks before the FOMC meets.

Sources: Investopedia, Federal Reserve Board, Investing Answers


Bellwether: An event or indicator that shows the possible presence of a trend in overall market or sector direction. The performance of certain companies/stocks and bonds are considered by analysts to indicate the condition of the economy and financial markets because their performance is well-correlated with a trend. Bellwether companies are usually the market leaders in their respective sectors. The term is a combination of “bell” and “wether.” Shepherds would often hang bells around the necks of the wether (male sheep) that led the flock, in order to find them.

Source: Investor Glossary, Investopedia