What's a benchmark? Or buyback? Or moat?

Readers said they were unclear on what certain financial jargon means, so we're providing a few more definitions.

Adam Zoll 9 March, 2015 | 5:00PM
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recent Ask the Expert column explained some commonly used but occasionally misunderstood financial jargon, and at the end we asked users to submit their own nominations for the list. We received lots of great suggestions, and this week we take on some of these reader-submitted items. So here we go:

Annual dividend/yield: The amount of a security's income that is distributed to its shareholders during the course of a year. Some stocks pay shareholders a portion of company profits in the form of dividends while bond holders typically receive interest payments. Both may be referred to as the investment's yield. (On Morningstar.ca's mutual fund and exchange-traded fund quote pages, this is represented by the "TTM Yield" metric, which stands for trailing 12-month yield. A 30-day SEC yield is also included for U.S.-traded ETFs. Yields at the top of stock quote pages also are TTM.) To calculate a security's annual yield, simply divide the amount of income paid out to investors during the past year by its share price.

Asset class: A broadly defined group of assets that have similar characteristics. Often these classes are broken down into stocks, bonds, cash and commodities, but the term could also be used to refer to non-securitized assets such as real estate and collectibles (such as fine art or rare coins).

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Las Vegas Sands Corp37.00 USD-2.76Rating
McDonald's Corp241.31 USD0.13Rating
Nasdaq Inc195.63 USD-0.11Rating
The Home Depot Inc335.32 USD0.58Rating
TMX Group Ltd139.29 CAD-0.11

About Author

Adam Zoll

Adam Zoll  Adam Zoll is an assistant site editor with Morningstar.com

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