Flashcards · Finance & Accounting
CFA Level I Flashcards
Free flashcards for CFA Level 1: flip each card to reveal the definition. Built from the CFA Level 1 glossary as a study aid, these are concept checks, not real exam questions.
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All 20 terms
- Time value of money
- Money today is worth more than the same amount later.
- Present value (PV)
- Today's value of a future cash flow.
- Future value (FV)
- The value of money at a future date with growth.
- NPV
- Net Present Value - discounted cash flows minus cost.
- IRR
- The discount rate that makes NPV zero.
- Discount rate
- The rate used to convert future cash flows to present value.
- Equity
- Ownership in a company.
- Fixed income
- Debt investments paying defined cash flows.
- Coupon
- The periodic interest a bond pays.
- Yield to maturity
- The total return if a bond is held to maturity.
- Duration
- A bond's price sensitivity to interest-rate changes.
- Derivative
- A contract whose value derives from an underlying asset.
- Diversification
- Reducing risk by spreading across assets.
- Alpha
- Return above a benchmark.
- Beta
- Sensitivity of an asset's return to the market.
- Liquidity
- How easily an asset converts to cash.
- Current ratio
- Current assets divided by current liabilities.
- ROE
- Return on equity.
- Standard deviation
- A measure of dispersion, used for risk.
- Code and Standards
- CFA Institute's ethics rules for members and candidates.