What is a Bunny Bond? A bunny bond is a type of bond or an investment that offers investors the option to reinvest payments or dividends. The investors can reinvest the payment to secure additional bonds. Usually, bonds with the same coupon and maturity are reinvested in. However, this does not mean that investors who prefer to receive their dividen...

What is A/B testing? A/B testing is a comparison method that is used to compare two versions of an app or webpage against each other to identify the version that performs best. The method is also known as "bucket testing" or "split testing".  Digital marketing is one of the key elements for any company that aims to achieve its set goals or increase ...

What is a Calendar Spread? A calendar spread is an investment strategy used by investors, it entails an act of concurrently entering both long and short positions on the same underlying asset or debt instrument. Both positions are entered at the same stake price but their expiration dates or delivery months differ. This means that the only area whic...

What is the American Association of Individual Investors? The American Association of Individual Investors refers to a nonprofit investor education organization in the United States. The organization has around 150,000 members with a focus on educating individual investors as far as financial planning, stock market portfolios, and retirement account...

What is the Law of Diminishing Marginal Returns? The decrease in a production process marginal output, as a single input factor rises while other input factors remain constant, is called the Law of Diminishing Marginal Returns in economic parlance. As a single input parameter rises incrementally in the production of a commodity, over time the return...

What is an Accumulated Income Payment? Accumulated Income Payments (AIPs) refers to the Canadian Registered Education Savings Plan (RESP), a valuable saving plan which allows parents, grandparents or guardians to save for their childs college fees. This RESP plan is also implemented in the United States as the 529 plan. How Does an Accumulated Incom...

What is the Commodity Credit Corporation? The Commodity Credit Corporation (CCC) is an agency of the government that supports, stabilizes and protects prices and farm income. It creates an even platform for supplying agricultural products. Besides this, it assists in the timely dispensation of these goods. What does the Commodity Credit Corporation ...

What is the Capital Market Line (CML)? Capital market line (CML) is a graph representing a portfolio's expected return based upon a given level of risk. On the horizontal axis is the portfolio standard deviation. On the vertical axis is the expected rate of return.   Capital Market Line   L = Standard deviation of L portfolio  M = Standard deviation...

What is an Interest Rate Swap? An interest rate swap is a form of contract where the parties agree to exchange or swap the interest payments on two securities. It is primarily a tool used by bond investors. A company that has issued corporate bonds seeks to improve its cash flow. It seeks to change the fixed rate on its corporate bonds for a floatin...

What is Company Risk? Risk is the possibility of an undesirable outcome. Investors in a company hope that a company will continue to perform as expected or more favorably. There is, however, a risk that the company will perform less favorably. This is known as company risk, specific risk, unsystemic risk, or diversifiable risk. There are numerous ty...