Investment Terms

Escrow is a legal concept describing a financial agreement whereby an asset or money is held by a third party on behalf of two other parties that are in the process of completing a transaction.
Escrow accounts are managed by the escrow agent. The agent releases the assets or funds only upon the fulfilment of predetermined contractual obligations. Money, securities, funds, and other assets can all be held in escrow.
Escrow is a financial process used when two parties take part in a transaction and there is uncertainty about the fulfilment of their obligations. Situations that may use escrow can involve Internet transactions, banking, intellectual property, real estate, mergers and acquisitions, law, and more.

A bill of lading is a legal document issued by a carrier (transportation company) 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.
Every business needs to have internal controls in place to prevent theft. One key component of internal control is the segregation of duties, which prevents one employee from having too much control within a business.

The term balanced scorecard refers to a strategic management performance metric used to identify and improve various internal business functions and their resulting external outcomes.
Used to measure and provide feedback to organizations, balanced scorecards are common among companies in the United States, the United Kingdom, Japan, and Europe.
Data collection is crucial to providing quantitative results as managers and executives gather and interpret the information.
Company personnel can use this information to make better decisions for the future of their organizations

A Bollinger Band is a technical analysis tool defined by a set of trendlines. They are plotted as two standard deviations, both positively and negatively, away from a simple moving average of a security's price and can be adjusted to user preferences.
Bollinger Bands was developed by technical trader John Bollinger and designed to give investors a higher probability of identifying when an asset is oversold or overbought.
The first step in calculating Bollinger Bands is to compute the simple moving average of the security, typically using a 20-day SMA.
A 20-day SMA averages the closing prices for the first 20 days as the first data point.

The term annuity refers to an insurance contract issued and distributed by financial institutions to pay out invested funds in a fixed income stream in the future.
Investors invest in or purchase annuities with monthly premiums or lump-sum payments. The holding institution issues a stream of payments in the future for a specified period or the remainder of the annuitant's life.
Annuities are mainly used for retirement purposes and help individuals address the risk of outliving their savings.
Annuities are designed to provide a steady cash flow for people during their retirement years and to alleviate the fears of outliving their assets.

Analysis of variance is an analysis tool used in statistics that splits an observed aggregate variability found inside a data set into two parts: systematic factors and random factors.
The systematic factors have a statistical influence on the given data set, while the random factors do not. Analysts use the ANOVA test to determine the influence that independent variables have on the dependent variable in a regression study.
The t- and z-test methods developed in the 20th century were used for statistical analysis until 1918, when Ronald Fisher created the analysis of variance method.
ANOVA is also called the Fisher analysis of variance, and it is the extension of the t- and z-tests.
The term was used in experimental psychology and later expanded to more complex subjects.

The last mile describes the short geographical segment of delivery of communication and media services or the delivery of products to customers located in dense areas.
Last-mile logistics tend to be complex and costly to providers of goods and services who deliver to these areas.
Delivery of telecommunications and media content is instantaneous and very fast for physical products to the perimeter of a densely-populated area. Imagine a trunk line leading to the edge of a city or metropolitan area.
Communications and media providers—inclusive of broadband cable, satellite, and wireless—spend heavily to upgrade old delivery systems and build out new networks to ensure adequate bandwidth for consumers hungry for data and streaming capabilities on their televisions, desktop computers, and mobile devices.

Environmental, social, and governance investing refers to a set of standards for a company’s behaviour used by socially conscious investors to screen potential investments.
Environmental criteria consider how a company safeguards the environment, including corporate policies addressing climate change, for example.
Governance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights.
ESG investors are also increasingly informing the investment choices of large institutional investors such as public pension funds.
An industry report from US SIF Foundation, investors held $17.1 trillion in assets chosen according to ESG principles in 2020, up from $12 trillion just two years earlier.1 ESG-specific mutual funds and ETFs also reached a record $400 billion in AUM in 2021, up 33% from the year before - and are expected to continue to grow rapidly in the coming years

A shelf offering is a Securities and Exchange Commission provision that allows an equity issuer to register a new issue of securities without having to sell the entire issue at once.
The issuer can instead sell portions of the issue over a three-year period without re-registering the security or incurring penalties.
A shelf offering is also known as a shelf registration; it is formally known as SEC Rule 415.1
A shelf offering allows a company to register a new issue with e SEC but allows for a three-year period to sell the offering instead of all at once.
This lets a company adjust the timing of the sales of a new issue to take advantage of more favourable market conditions should they arise in the future.
The company maintains any unissued shares as treasury stock, where they remain "on the shelf" until offered for public sale.

A command economy is a key aspect of a political system in which a central governmental authority dictates the levels of production that are permissible and the prices that may be charged for goods and services. Most industries are publicly owned.
The main alternative to a command economy is a free market system in which demand dictates production and prices.
The command economy is a component of a communist political system, while a free market system exists in capitalist societies.
Cuba, North Korea, and the former Soviet Union all have command economies. China maintained a command economy until 1978 when it began its transition to a mixed economy that blends communist and capitalist elements.1 Its current system has been described as a socialist market economy.