Definitions Starting with "R"

R Squared

R-squared, usually represented as R2, is a technique that evaluates the statistical relationship between two series of events. It is commonly used to describe the portion of a security's movement in the market relative to the movement of a related index. Read more

Rabbi Trust

A rabbi trust is a type of deferred compensation plan that lets employers transfer money into a trust for executives. Rabbi trusts were first used to compensate rabbis, which is how they get their name. Read more

Racketeering

When most people think of racketeering, thoughts of 1930s mobsters come to mind. Gangs of this time period are often associated with organized crime and operating “rackets” to illicitly earn and move money throughout criminal networks. Read more

Raider

In the finance world, raider is short for corporate raider, which is a person or entity that purchases a company for the sole purpose of selling off its assets. Raiders are attracted to companies whose assets have book values that are higher than their market capitalizations. Read more

Rain Check

A rain check is a written promise from a seller to a buyer. It guarantees that a buyer can purchase a product for a certain price at a later date, usually because the item is out of stock. Read more

Rainbow Option

A rainbow option is an option linked to two or more underlying assets. Just as rainbows have many colors, options can have many underlying assets. Read more

Rainmaker

A rainmaker is a successful salesperson or other individual who generates significant revenue for a company. Let's say John Doe is a salesman for Company XYZ. Read more

Raintaker

A raintaker is a successful salesperson or other individual who generates significant revenue for a company and then takes those clients with her to a new employer. A rainmaker is a successful salesperson or other individual who generates significant revenue for a company. Read more

Rally

A rally is a period of hours, days, weeks, months, or sometimes years during which securities prices consistently rise.   Identifying and measuring rallies is both art and science. Read more

Ramp Up

A ramp up is an increase in the amount of products or services a company sells, usually by expansion into new markets or geographic regions. Let's say John Doe opens a sandwich shop. Read more

Random Walk Theory

The random walk theory states that market and securities prices are random and not influenced by past events. The idea is also referred to as the "weak form efficient-market hypothesis. Read more

Rate and Term Refinance

A rate and term refinance occurs when a borrower replaces one mortgage with another mortgage that has a different maturity and interest rate. For example, let's say John Doe bought a house 10 years ago for $250,000. Read more

Rate of Change

Rate of Change (ROC), is the percentage change in price over a specified time frame. It is one of the most basic ways to measure momentum. Read more

Rate of Return

A rate of return is measure of profit as a percentage of investment. Let's say John Doe opens a lemonade stand. Read more

Rate Trigger

A rate trigger is a change in interest rates that prompts a bond issuer to call its bonds.   Let's say Company XYZ issued a bond with a 10% coupon rate this  year. Read more

Rating

In personal finance, the term rating commonly refers to a credit rating score issued by the Fair Isaac Corporation (a "FICO score"). A person's credit rating indicates how creditworthy he or she is. Read more

Ratings Service

Ratings Service is provided by companies that evaluate the risks associated with debt securities.  Companies, such as Moody's, Standard & Poor's (S&P), and Fitch, provide ratings for securities based on underwriting criteria. Read more

Ratio Analysis

Ratio analysis is the exercise of calculating various pieces of financial data in relation to one another. There are dozens of financial ratios out there. Read more

Raw Materials

Raw materials are commodities, parts or substances that are assembled or processed to form a final product.   For example, the raw materials involved in chocolate chip cookies are butter, sugar, eggs, flour, vanilla, baking powder and chocolate. Read more

Re-Offer Price

A re-offer price is the price at which an underwriter offers a security to the general public. In order to sell its securities to the public, a company first needs to retain the services of an investment banker to underwrite the issue. Read more

Reaffirmation

Reaffirmation occurs when a lender agrees to forgive a borrower's debt and then the borrower agrees to repay the debt anyway. For example, let's assume that John Doe borrowed $100,000 from Bank XYZ for a luxury car. Read more

Reaganomics

Reaganomics is a reference to U. S. Read more

Real Asset

A real asset is a tangible, touchable asset that has value. For example, Company XYZ's factory is a real asset, its fleet of cars are real assets and even its cubicles are real assets. Read more

Real Estate

Real estate refers to land, as well as any physical property or improvements affixed to the land, including houses, buildings, landscaping, fencing, wells, etc. Vacant land and residential lots, plus the houses, outbuildings, decks, trees sewers and fixtures within the boundaries of the property are examples of real estate. Read more

Real Estate Agent

A real estate agent, working on behalf of a licensed real estate broker, is a licensed professional who works on behalf of the buyer and seller of real estate during a sales transaction. A real estate agent, working on behalf of a real estate broker, acts as an intermediary between sellers and buyers. Read more

Real Estate Investment Trust (REIT)

A real estate investment trust (REIT) is a closed-end investment company that owns assets related to real estate such as buildings, land and real estate securities. REITs sell on the major stock market exchanges just like common stock. Read more

Real Estate Owned (REO)

Real estate owned (REO) is a term describing real estate owned by lenders, usually because the lender has foreclosed on the property. Let's say John Doe falls behind on his house payments, and his lender, Bank XYZ, forecloses on the house. Read more

Real Estate Settlement Procedures Act (RESPA)

The Real Estate Settlement Procedures Act, abbreviated as RESPA, is a federal ordinance that was established by the U. S. Read more

Real Estate Short Sale

A real estate short sale is the sale of property that is worth less than what is owed on it. For example, let's say John Doe buys a house for $500,000. Read more

Real GDP

Real gross domestic product, or real GDP, is a measure of the value of all goods and services produced by an economy in a period. Because the value is adjusted for inflation it can separate out the effects of changes in price levels and can provide a more detailed measure of economic productivity growth. Read more

Real Income

Real income is inflation-adjusted income or wages. For example, let's say John Doe works for Company XYZ. Read more

Real Interest Rate

A real interest rate is an inflation-adjusted interest rate. Let's say John Doe has a bond from Company XYZ that pays a 4% coupon. Read more

Real Property

Real property is anything that is attached to land. For example, Company XYZ's factory, the five-acre lot on which the factory sits and whatever oil, gas or mineral rights that are attached to the land are real property. Read more

Real Rate of Return

A real rate of return is a return on an investment that is adjusted for inflation, taxes or other external factors. Let's say John Doe opens a savings account that offers a 2. Read more

Real-Time Quote

A real-time quote is a stock quote that feeds directly from the exchange and does not have a time delay.   A stock quote is an estimate of price or a price at which one party is willing to buy or sell a certain number of shares of stock from the other. Read more

Realized Gain

Realized gains are increases in the value of an asset that has been sold. This concept is the opposite of paper profit -- a paper profit only turns into a realized gain when you actually sell the security. Read more

Realized Loss

A realized loss is a decrease in the value of an asset that has been sold. This concept is the opposite of paper loss or unrealized loss -- a paper loss only turns into a realized loss when you actually sell the security. Read more

Realtor

A realtor is a professional designation for a real estate broker who has membership in the National Association of Realtors (or NAR). Real estate agents must be certified members of the NAR in order to bear the title "realtor. Read more

Rebalancing

Rebalancing is the adjustment to an investment portfolio that realigns the investor's holdings with their targeted allocation of assets. Investors often use an asset allocation method in their investment strategies. Read more

Rebate

In stock trading, a rebate occurs when a short seller has taken a short position in a stock that then pays a dividend before the settlement date. The rebate is the dividend that the short seller is required to pay to the owner of the stock. Read more

Recapture

A recapture occurs when a person or entity takes back an asset from a buyer under certain conditions. Taxing authorities can implement tax recaptures in which the taxing authority requires a taxpayer to pay taxes on previous years of income (usually when the taxpayer took a deduction or tax credit that the taxing authority decides was inappropriate). Read more

Recapture Clause

A recapture clause is language in a contract that allows a person or entity to take back an asset under certain conditions. Let's say John Doe owns the ABC Shopping Center. Read more

Receivables

The term receivables is short for accounts receivable (A/R), which are amounts bought by customers for a company's goods and services. Company XYZ sells $1 million in widget parts to a widget manufacturer and gives that customer 60 days to pay for those parts. Read more

Receivables Turnover Ratio

The receivables turnover ratio is a company's sales made on credit as a percentage of average accounts receivable. The formula for receivables turnover ratio is: Receivables Turnover = Net Credit Sales/Average Accounts Receivable For example, let's assume that Company XYZ sells $10,000,000 of widget parts this year. Read more

Receivership

Receivership is a form of bankruptcy in which a court-appointed trustee reorganizes the bankrupt entity.   In a receivership, a receiver takes custody of the company's property and operations. Read more

Recession

A recession is two consecutive quarters of declining gross domestic product (GDP) Let's assume that there has been a significant decline in industrial production, employment, and wholesale or retail trade. These things may cause GDP to decline for a three-month period (a quarter). Read more

Recession Resistant

A stock or other investment is recession resistant when it tends to rise in value when the economy falters (and the markets falter with it). Recession-resistant investments are usually countercyclical, meaning they tend to move in opposition to the overall business cycle. Read more

Recession-Proof

A recession-proof investment does well or at least remains stable during economic contractions. Defensive stocks are the most famous kind of recession-proof investments, because they generally are able to weather economic dips. Read more

Record Date

The record date is the date used to determine the holders of a security who are entitled to receive a dividend or distribution. When a company is preparing to distribute dividends to shareholders, it uses a list of shareholders who are holding the security on a particular date. Read more

Record High

A record high is the highest price a security achieves in a given time period. Let's look at this random chart for Cisco Systems (CSCO). Read more

Record Low

A record low is the lowest price a security achieves in a given time period.   For example, let's look at this random chart for Cicso Systems (CSCO). Read more

Recording Fee

A recording fee is the cost of making a public record of a real estate transaction. Let's say John Doe buys a house from Jane Smith for $300,000 on October 1. Read more

Rectangle Formation

A rectangle formation describes a price pattern where supply and demand are in approximate balance for an extended period of time. In such a scenario, the shares tend to move in a narrow range, hitting resistance at the rectangle's top and finding support at its bottom. Read more

Recurring Revenue

Recurring revenue is revenue that a company has reasonable assurance will occur at regular intervals in the future.   Let's assume Company XYZ sells a widget-cleaning service. Read more

Red

Red is slang for loss. Losses are the negative amount remaining after all costs, depreciation, interest, taxes, and other expenses have been deducted from total sales. Read more

Red Herring

A red herring is a registration statement filed with the Securities and Exchange Commission (SEC) by a company that intends to make a public equity offering. The red herring is a rough draft of the company's prospectus and includes a description of the company's business, financial condition, strategy, management, litigation and risk factors. Read more

Redundant Asset

A redundant asset is an asset that generates income, but is not linked to the fundamental operations of the company. Also known as a non-operating asset, a redundant asset usually generates some type of revenue or return for the owning company, but does not play a part in the company's operations. Read more

Reference Rate

A reference rate is an interest rate that determines another interest rate. Let's say you want to borrow $5,000 to start a business. Read more

Refinancing

Refinance refers to the replacement of a debt with new debt bearing different terms. Financing involves borrowing a specific amount of money over a length of time at an agreed-upon interest rate. Read more

Refund

Refund can refer to the amount that the Internal Revenue Service will pay to a taxpayer based an overpayment of estimated tax or employer withholding taxes during the year.  A refund also refers to the procedure where an issuer refinances outstanding bonds by issuing new bonds. Read more

Refunding Protection

Refunding protection is bond provision that keeps an issuer from using cheaper debt to redeem a bond issue before it matures. Let's assume Company XYZ issues $10 million of 10% coupon bonds that mature in 10 years. Read more

Registered Investment Advisor (RIA)

A Registered Investment Advisor (RIA) is an investment manager who is registered with the Securities Exchange Commission (SEC) and who must comply with SEC regulations. An investment manager who is an RIA has not necessarily completed a level of education that qualifies him or her to provide a higher level of service. Read more

Registered Principal

A registered principal is a person in a management position in the investment banking or securities business. For example, a registered principal might oversee the trading and sales operations at a brokerage firm, manage an investment firm's compliance efforts, or simply oversee a financial institution's operations. Read more

Regression

Regression is a statistical method used in finance and other fields to make predictions based on observed values. It is a measure of how correlated a group of actual observations are to a model’s predictions. Read more

Regressive Tax

A regressive tax is a tax that increases as a percentage of income as the amount of income declines. The United States has the opposite of a regressive tax system. Read more

Regulation DD

Regulation DD is a directive created by the Federal Reserve. It was enacted to fulfill the Truth in Savings Act (TISA) that was passed in 1991, which requires lenders to provide accurate information about fees and interest to account holders when they begin banking with that institution. Read more

Regulation Fair Disclosure (Reg FD)

Regulation Fair Disclosure (Reg FD) requires all publicly traded companies to disclose material information to all investors simultaneously. The Securities and Exchange Commission (SEC) issued a ruling in 2000 requiring publicly traded companies to disclose important information pertaining to the business finances, market, competition, and principals (i. Read more

Regulatory Data

Regulatory data is information that must be provided by a company to a regulatory agency.   Protecting consumers is the main rationale offered by governments looking to regulate economic activity, and they try to do so in two primary ways. Read more

Reinvestment Rate

Reinvestment rate is the rate at which an investor can reinvest cash flows from an investment. Put simply, an investor might receive, say, a 6% dividend, but what does he do with that money when he gets it? If he chooses to invest it in a CD that pays 4%, then his reinvestment rate is 4%. Read more

Reinvestment Risk

Reinvestment risk is the chance that an investor will not be able to reinvest cash flows from an investment at a rate equal to the investment's current rate of return. For example, consider a Company XYZ bond with a 10% yield to maturity (YTM). Read more

Relative Strength

Also called price persistence, relative strength is the tendency of a security's price to follow the trend of an index like the S&P 500. It is a measure of momentum. Read more

Relative Strength Index (RSI)

The Relative Strength Index (RSI) was first developed by renowned technical analyst J. Welles Wilder. Read more

Relative Strength Line

The relative strength line compares a stock's price performance against that of the overall market, usually as measured by the S&P 500. However, if the trader desires, the comparison can be made to another stock or index. Read more

Relevant Risk

Also called systematic risk or non-diversifiable risk, relevant risk is the fluctuation of returns caused by the macroeconomic factors that affect all risky assets.   Diversifiable risk is the risk of something going wrong on the company or industry level, such as mismanagement, labor strikes, production of undesirable products, etc. Read more

Remote Deposit Capture (RDC)

The term remote deposit capture (RDC) refers to a technology that uses a smartphone to make online deposits to a user's bank account without having to physically visit a branch location. RDC is a service that allows users to scan checks and transmit the scanned images to a bank for posting and clearing. Read more

Reorganization

Reorganization may refer to the rehabilitation of a company's finances pursuant to a bankruptcy. It can also refer to any process that affects the tax structure of a corporation. Read more

Repayment

Repayment usually refers to the payments on a debt.   Under the terms of a loan, repayment can have different schedules and requirements. Read more

Repurchase Agreement (Repo)

A repurchase agreement is the sale of a security combined with an agreement to repurchase the same security at a higher price at a future date.  It is also referred to as a "repo. Read more

Rescission

Rescission is the cancelling of a contract so that it is no longer legally binding. A court can release parties from any obligations under the contract and revert them to their positions before the contract was executed. Read more

Research and Development (R&D)

Research and development (R&D) aims to create new technology or information that can improve the effectiveness of products or make the production of products more efficient. Let's say company XYZ is a pharmaceutical company that produces pain relieving medication. Read more

Reserve Ratio

The reserve ratio is the percentage of deposits that the Federal Reserve requires a bank to keep on hand at a Federal Reserve Bank. For example, let's assume that Bank XYZ has $400 million in deposits. Read more

Reserve Report

A reserve report is filed by companies in the oil and gas industry. It estimates remaining quantities of oil and gas (reserves) expected to be recovered from existing properties. Read more

Reserve Requirements

Reserve requirements are Federal Reserve rules that require banks and other financial institutions to keep a strict percentage of their deposits on reserve at a Federal Reserve bank. The Federal Reserve determines the appropriate percentage. Read more

Residual Income Model

Also called the abnormal earnings valuation model, the residual income model is a method for predicting stock prices. In this theory, every stock is worth the company's book value per share if investors expect the company to earn a "normal" rate of return in the future. Read more

Resistance

In technical trading analysis, resistance is an upper limit in a price channel in which a security’s price tends to stay. Price channels can slope up (indicating bullish sentiment) or down (indicating bearish sentiment); they don’t have to simply go “sideways. Read more

Restricted Card List

A restricted card list is a list of credit cards that are reported stolen, canceled or compromised in some way. A restricted card list is also called a "warning bulletin," "hot list" or "cancellation bulletin. Read more

Restricted Stock

Restricted stock is stock that the owner cannot sell immediately or under certain conditions. People usually come to own restricted stock through an IPO or a merger. Read more

Restrictive Covenant

A restrictive covenant is a promise a company makes to not exceed certain financial ratios or not conduct certain activities, usually in return for a loan or bond issue.     Let’s assume Company XYZ wants to borrow $10 million from Bank ABC. Read more

Restructure

Restructure, or restructuring, refers to the management process of reorganizing a company to make it more profitable.  During a major transition, a buyout or a bankruptcy, for example, the management may consider restructuring a company. Read more

Retail Banking

Retail banking refers to the consumer-oriented services offered by commercial banks. These services include checking and savings accounts, mortgages and various types of loans and investment services relating to retirement and educational planning. Read more

Retail Investor

A retail investor is an individual who purchases securities for his or her own personal account rather than for an organization. Retail investors typically trade in much smaller amounts than institutional investors such as mutual funds, pensions, or university endowments. Read more

Retained Capital

Retained capital is the sum of a company's profits, after dividend payments, since the company's inception. It can also be called retained earnings, earned surplus, or accumulated earnings. Read more

Retained Earnings

Retained earnings are the sum of a company's profits, after dividend payments, since the company's inception. They are also called earned surplus, retained capital, or accumulated earnings. Read more

Retracement

A retracement is a temporary reversal in the movement of a stock's price.  Let's say the stock of company XYZ increased 20% over the course of a day. Read more

Return of Capital (ROC)

Return of capital (ROC) is a payment from a security to an investor from funds that were not derived from net income. Real estate investment trusts (REITs), mutual funds, master limited partnerships (MLPs) and other investments commonly make returns of capital. Read more

Return on Assets (ROA)

Return on assets (ROA) is a financial ratio that can help analyze the profitability of a company. ROA measures the amount of profit a company generates as a percentage relative to its total assets. Read more

Return on Capital (ROC)

Return on capital (ROC) is a ratio that measures how well a company turns capital (e. g. Read more

Return on Equity (ROE)

Return on equity (ROE) is a measurement of how effectively a business uses equity – or the money contributed by its stockholders and cumulative retained profits – to produce income. In other words, ROE indicates a company’s ability to turn equity capital into net profit. Read more

Return on Invested Capital (ROIC)

Return on invested capital (ROIC) is a profitability ratio. It measures the return that an investment generates for those who have provided capital, i. Read more

Return on Investment (ROI)

. calc-input { width: 120px!important; height: 35px !important; font-size: 16px; padding-right: 5px; } #calc-cagr-button { border: 0pt none; float: left; width: 148px; height: 48px; margin-top: 3px; background-color: #2DB200; color: #ffffff; text-transform: uppercase; } ROI (or return on investment) measures the gain/loss generated by an investment in relation to its initial cost. Read more

Return on Net Assets (RONA)

Return on net assets is a metric which measures a company's financial performance with regard to fixed assets combined with working capital. Return on net assets (RONA) is calculated by dividing a company's net income in a given period by the total value of both its fixed assets and its working capital. Read more

Return on Total Capital

Return on total capital is a profitability ratio. It is a measure of the return an investment generates for those who contribute capital, i. Read more

Revaluation

Revaluation refers to the adjustment of the exchange rate of a country's currency. In countries with fixed exchange rate rates, the central bank (i. Read more

Revenue

Revenue, also called sales (or turnover, in the UK), refers to the value of the products and services a company sells. Net revenue usually refers to a company's sales net of discounts and returns. Read more

Revenue Bond

Revenue bonds are municipal bonds that are issued to fund specific projects that generate their own revenue. Let's assume ABC Town wants to build a new toll road, but it doesn't have the money to fund the construction. Read more

Revenue per Available Room (RevPAR)

Revenue per available room, or RevPAR for short, is a ratio commonly used to measure financial performance in the hospitality industry. The metric, which is a function of both room rates and occupancy, is one of the most important gauges of health among hotel operators. Read more

Revenue Per Employee

Revenue per employee measures the average revenue generated by each employee of a company.   Revenue per employee is calculated by dividing a firm's revenue by its total number of workers (Revenue/Number of Employees). Read more

Reverse Mortgage

A reverse mortgage is an arrangement whereby a homeowner borrows against his or her home equity and receives regular payments from the lender until the total payments reach a predetermined limit. To qualify for a reverse mortgage, a prospective borrower must be at least 62 years old and own his or her residence. Read more

Reverse Split

A reverse split is a consolidation of a corporation's shares according to a predetermined ratio. Company XYZ wants to conduct a reverse stock split. Read more

Reverse Takeover

A reverse takeover is the purchase of a publicly-traded company by a smaller private company. In what is also called a reverse merger, a private company purchases an increasingly controlling stake in a publicly-traded company. Read more

Reverse Triangular Merger

A reverse triangular merger is a merger in which the acquisition is carried out by a subsidiary of the acquiring company. In a reverse triangular merger, a subsidiary of the acquiring company executes the purchase of the target company. Read more

Revocable Trust

A revocable trust is a trust with provisions that can be altered by the grantor. Sometimes a revocable trust is referred to as a "living revocable trust. Read more

Revolving Credit

Revolving credit is a line of credit individuals and corporations can borrow from and pay back as needed. Revolving credit is also referred to as a line of credit (LOC) Before granting a revolving line of credit to an applicant, a financial institution considers several factors that determine a borrower's ability to repay. Read more

Right of First Refusal

Right of first refusal grants the terms of a transaction to one party to determine if they are interested (i. e. Read more

Rising Star

Rising star companies have a low credit rating (often "junk"), but only because they are new to the bond market or still establishing a track record.   A rising star is a relatively new company that doesn't yet have the track record and/or the size to earn an investment-grade rating from a credit rating agency like Standard & Poor's or Moody's. Read more

Risk Averse

Risk averse is an oft-cited assumption in finance that an investor will always choose the least risky alternative, all things being equal. Modern portfolio theory (MPT), which is the theory behind why diversification works, relies on the assumption that investors are risk averse. Read more

Risk Free Rate of Return

A risk free rate of return, often denoted in formulas as rf,, is the rate of return associated with an asset that has no risk (that is, it provides a guaranteed return). It is also commonly referred to as "risk free return. Read more

Risk Lover

A risk lover is an investor who has a high propensity to engage in risky investments. A risk lover is the opposite of a risk-averse investor. Read more

Risk-Free Asset

A risk-free asset is an asset that provides a virtually guaranteed return.   Treasury bills are the most common example of risk-free assets. Read more

Road Show

A road show is a presentation made about an investment opportunity usually given by a representative of a company at the offices of potential investors.  Businesses must travel and meet with potential investors, partners and customers to gain their support. Read more

Rolling EPS

The rolling EPS is a variation of the earnings per share (EPS) metric which measures a company's profitability. The rolling EPS is measured on the basis of a year and is calculated by adding a company's EPS from the two previous quarters to the projected EPS for the two upcoming quarters. Read more

Rolling Returns

Rolling returns are the returns on an investment measured over several periods. The rolling returns on an investment are measured over a discrete number of consecutive periods (usually years) starting with the beginning of the earliest period and finishing with the end of the most recent. Read more

Roth IRA

A Roth IRA is a type of Individual Retirement Account (IRA) for individuals who fall below certain income thresholds. One of the primary benefits to investing in a Roth IRA is that distributions are tax-free once withdrawals are made. Read more

Round Lot

A round lot is a securities trade for 100 trading units. In stock trading, a round lot is 100 shares. Read more

Rounding Error

A rounding error is a mistake made when rounding a number up or down.   For example, most math books teach students to round numbers 5 through 9 up. Read more

Routing Number

A routing number is a exclusive identification number assigned to banking institutions by the American Bankers Association (ABA). For those banks and banking institutions that qualify as account holders with the Federal Reserve, the ABA assigns a routing number for identification. Read more

Roy's Safety-First Rule

Roy's safety-first rule is a measure of the minimum returns an investor requires from a portfolio. The formula for Roy's safety-first rule is: Roy's Safety-First Rule = (Expected return for portfolio – Threshold return for portfolio)/Standard deviation of portfolio The mechanics of the formula are simple: Input the investor's minimum required return, the expected return for the portfolio, and the standard deviation for the portfolio. Read more

Royalty Trust

A royalty trust is a type of corporation created to act as the owner of the mineral rights to wells, mines and similar properties.   It exists only to pass income generated from the sale of the property's assets (gold, oil, etc. Read more

RSI Indicator

The RSI indicator mirrors and anticipates price patterns in the underlying stock or index chart. The indicator's designer, Welles Wilder, intended for the RSI Indicator to help traders spot chart formations not obvious on a bar chart. Read more

Rule of 72

The "rule of 72" is a method of estimating how long it will take compounding interest to double an investment. The rule of 72 is a method used in finance to quickly estimate the doubling or halving time through compound interest or inflation, respectively. Read more

Run

A run occurs when a flood of depositors withdraw their funds from a bank within a short time frame. It’s important to remember one thing about banks: They don’t keep your money in cash in a vault. Read more

Runs Test

A runs test is a statistical procedure that can be used to decide if a data set is being generated randomly, or if there is some underlying variable that is driving results. If data points are randomly distributed above and below a regression curve, you should be able to predict the number of patterns (runs) you'd expect to see. Read more

Russell 1000 Index

The Russell 1000 Index is designed to track the performance of most major large-cap companies. Though it is not usually cited by individual investors, it is the third most widely used benchmark by money managers (behind the S&P 500 and the Russell 2000). Read more

Russell 2000 Index

The Russell 2000 index measures the performance of the 2,000 smallest companies in the Russell 3000 index. The Frank Russell Company created the index in 1984, and it was one of the first broad benchmarks of the U. Read more

Russell 3000 Index

Started in 1984, the Russell 3000 Index attempts to capture the return of the overall market. The index can be subdivided into two segments: the Russell 1000 (consisting of the 1000 largest market-cap companies) and Russell 2000 (consisting of 2000 small-cap companies). Read more

Russian Option

A Russian option is a type of lookback option which does not have an expiration date. As a lookback option, a Russian option may be exercised according to American or mid-Atlantic settlement rules based on the underlying security's most profitable market price during the life of the option. Read more