This term might apply to bonds or pensions and other financial instruments which build up interest value which is paid out at a later time.
Accrual Rate is the rate at which a nominal interest rate is credited to an account that will be paid out at a later time. A bond sold in the secondary market, for instance, will take the accrual rate into account if the sale takes place in between coupon payments.
The accrual rate is the nominal or coupon rate of the bond, basically, but is used to determine how much should be paid for a bond. The buyer must compensate the seller for the amount of interest accrued up to the point of the sale, because the bond will not pay out its regular coupon payment until the next scheduled time, which could be months down the road.
Accrual rate also applies to other financial instruments, such as pensions. Employee pensions have an accrual rate which is applied to the number of days or hours worked: for each day or hour worked, the accrual rate will determine how many days-worth of pension income will be paid into the employee’s pension fund. Vacation days and vacation pay may also have an accrual rate.
Within each asset class, diversification is also important. In your equity portfolio, you should have exposure to stocks
A call option is a type of contract that allows the contract holder to purchase an underlying stock at a specific price
A time spread using call options is a strategy that buys and sells the same number of options with the same strike price
Variable annuities provide downside protection, while also providing market exposure that may give the upside potential
In general, Social Security Benefits will only be paid in cases where individuals paid into the system
Social Security retirement benefits are computed by the average monthly income during the highest-earning 35 years
The Russell 1000 comprises over 90% of the total market capitalization of U.S. stocks, and is the go-to benchmark
If a central bank takes actions that intentionally affect the value of a currency it is Foreign Exchange Intervention
Income for an area or country it totaled up and divided by the total population of the area to give us the Income Per Capita
The Ascending Triangle pattern forms when a currency pair price tests a resistance level and creates a horizontal top line