Financial Terms Dictionary - Letter N

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Naive diversification

Naive diversification is an investment strategy where a portfolio is constructed by equally distributing investments among a wide range of assets without regard to the statistical properties such as variance and correlation of the asset returns.

NASDAQ Stock Exchange

The Nasdaq Stock Market is a global electronic marketplace for buying and selling securities, as well as the benchmark index for US technology stocks. It is known for its large number of tech stocks.

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National best bid and offer

The NBBO meaning is explained as the lowest available ask price and the highest available bid price among all exchanges for a security. It ensures that all investors receive the best possible price for a stock at any given time.

Neon Swan

A neon swan refers to a rare but highly predictable event of serious consequences. As opposed to a black swan event, a neon swan event typically follows a series of warning signs that lead up to it, and therefore, in theory, may be prevented.

Net Asset Value (NAV)

What does NAV mean? It stands for 'net asset value' and is the per-share value of a mutual fund or ETF, calculated by dividing the total value of all the assets in the portfolio, minus liabilities, by the number of shares outstanding.

Net capital outflow

Net capital outflow refers to the net flow of funds being invested abroad by a country over a certain period of time, including investments in foreign stocks, bonds, and other financial assets.

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Net debt repayment

Net debt repayment refers to the amount by which a company reduces its existing debt obligations within a given period, reflecting its financial strategy and stability.

Net income per employee

Net income per employee is a metric that measures a company's profitability on a per-employee basis, calculated by dividing the net income by the total number of employees.

Net interest income

Net interest income is the difference between the revenue that is generated from a bank's assets and the expenses associated with paying out its liabilities.

Net interest margin

Net interest margin is a profitability indicator for banks, calculated by subtracting the interest paid on deposits from the interest earned on loans, then dividing by the total amount of their interest-earning assets.

Net interest spread

Net interest spread refers to the difference between the interest rates earned on assets and the interest rates paid on liabilities. It does not adjust for the riskiness of the assets.

Net operating assets

Net operating assets (NOA) are the assets required for a business to operate, minus the liabilities that are related to operations. It is calculated as operating assets minus operating liabilities, and provides insight into the operating efficiency and investment needed to run the business.Learn more

Net Operating Income (NOI)

Net operating income (NOI) is a measure of a company's profitability calculated before deducting interest expenses, taxes, and capital expenditures. It is used particularly in real estate to assess a property’s profitability from its core operations.

Net Profit

Net profit, also known as net income, is the total earnings of a company after all expenses and taxes have been deducted from revenue. It is a key indicator of a company's financial health and profitability.

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Net value asset

Net asset value (NAV) is the value per share of a fund or company, calculated by subtracting total liabilities from total assets, and dividing by the number of shares outstanding. In mutual funds, it represents the price at which shares are bought and sold.

Networking

In a business context, networking involves interacting with others to exchange information and develop professional or social contacts. It is often used as a means to open up career opportunities and foster collaborations.

New York Stock Exchange (NYSE)

The NYSE, or New York Stock Exchange, is one of the world's largest stock exchanges, located in New York City, and is associated with indices such as the US Wall Street 30 and US Tech 100. It is known for its large listed companies and is a prominent symbol of American capitalism.

NEXUS

In economic terms, nexus refers to the connection or link between a business and a taxing jurisdiction that establishes the right of that jurisdiction to impose a tax on the business. It is a key concept in determining tax liabilities for businesses operating in multiple locations.

Nifty 50 index

The Nifty 50 is a stock market index representing the 50 most significant stocks listed on the National Stock Exchange of India, measured by market capitalisation and liquidity. It is a benchmark index for India’s equity market performance.

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Nifty Fifty

Historically, 'Nifty Fifty' referred to a group of 50 popular large-cap stocks on the New York Stock Exchange in the 1960s and 1970s, famous for their consistent growth and stable returns. The term is sometimes used similarly in other contexts, like the Nifty 50 Index in India.

Nikkei 225 index

The Nikkei Index, or the Nikkei 225, is a stock market index for the Tokyo Stock Exchange, comprising 225 top-rated companies from diverse industries. It is a leading indicator of Japanese stock market performance and can be traded on Capital.com through the Japan 225 market.

Noddle (credit report service)

Noddle was a UK credit report service provided by TransUnion, one of the major credit bureaus. It offered consumers access to their credit scores and reports. Noddle has been rebranded as Credit Karma following its acquisition.

Node

A crypto node is a computer on a cryptocurrency network that upholds the network's protocol and participates in its operation, either by relaying transactions, validation, or hosting a copy of the blockchain.

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Nominal vs real GDP

Nominal vs real GDP is a key concept in financial terms. Nominal GDP denotes the market value of all goods and services produced in a country in a given period, measured using current prices. Meanwhile, real GDP adjusts nominal GDP for inflation to reflect changes in real output. It provides a more accurate depiction of an economy's size and how it's growing over time.

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Nominal yield

Nominal yield is the interest or dividends received from a security based on the face value of the security. It does not account for inflation or the price paid for the security, providing a basic measure of return.

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Non-disclosure agreement (NDA)

An NDA is a legally binding contract establishing a confidential relationship between parties. It agrees that sensitive information they may obtain will not be made available to any others.

Non-fungible token (NFT)

An NFT is a digital token that represents ownership of a unique item or piece of content, such as art, music, or videos, using blockchain technology. Unlike cryptocurrencies, NFTs are not interchangeable.

Non-operating income

Non-operating income is revenue or expense considered unrelated to the core operations of a business, such as investment gains, losses from foreign exchange, or sales of assets.Learn more

Non-performing Loan (NPL)

A non-performing loan (NPL) is a loan on which the borrower is not making interest payments or repaying any principal. An NPL is typically in default or close to being in default.

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Non-renounceable rights

In a non renounceable rights issue, shareholders are given the right to purchase additional shares at a discounted price, but unlike renounceable rights, these cannot be sold or transferred to others.

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Non-voting stock

Nonvoting stock is shares in a company that confer no voting rights to the holder on matters such as corporate policies or director elections, typically issued to maintain control by the founders or other interests.

Normalised earnings

Normalised earnings is a term used to describe a company's profits adjusted for unusual or one-off items that are not expected to recur frequently. This adjustment provides a clearer picture of the company's ongoing profitability.

NTX index

The NTX Index often refers to a stock index related to a specific region or market sector, but specific details may vary depending on the context or the specific index referred to.

Numéraire

In economics, the numeraire is a commodity or asset which is used as a benchmark or unit of account to price goods and measure their relative worth.

NYMEX

What is the NYMEX? It stands for the New York Mercantile Exchange and is a commodity futures exchange owned and operated by CME Group of Chicago. NYMEX is located in New York and primarily trades in energy and metals.

NZX 50 Index

The NZX 50 Index is the main stock market index in New Zealand. It tracks the performance of the 50 largest and most liquid companies listed on the New Zealand Exchange.