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According to this method, we calculate the interest charges for each balance by applying the “daily periodic rate” for that balance to the “daily balance” for that balance. We do this for each day in the billing cycle and sum the resulting interest charges. That gives us the total interest charges for that balance for that billing period.
The “daily periodic rate” is a daily interest rate. The daily periodic rate for a given balance is equal to the APR for that balance divided by 365.
We calculate the “daily balance” for each balance. We do this by starting with the beginning amount of that balance for each day. We add any new charges for that day, add any interest on the previous daily balance if there is one in that billing cycle, and subtract any payments or credits. This gives us the “daily balance.”
The addition of the prior day’s interest to the daily balance calculation causes interest to compound daily.
We add fees that are specific to a particular charge to the same daily balance as that particular charge. We add all other applicable fees to your purchase balance as of the first day of a billing period.
- Browse Related Terms: "Go-to" rate, Average daily balance method with compounding, Average daily balance method without compounding, balance, Daily balance method with compounding, Daily balance method without compounding, Daily periodic rate (DPR), Default APR, Interest-free period, Introductory APR, Penalty APR, Periodic rate, Purchase APR
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According to this method, we calculate the interest charges for each balance by applying the “daily periodic rate” for that balance to the “daily balance” for that balance. We do this for each day in the billing cycle and sum the resulting interest charges. That gives us the total interest charges for that balance for that billing period.
The “daily periodic rate” is a daily interest rate. The daily periodic rate for a given balance is equal to the APR for that balance divided by 365.
We calculate the “daily balance” for each balance. We do this by starting with the beginning amount of that balance. We add any new charges for that day, excluding any unpaid finance charge, and subtract any payments or credits. This gives us the “daily balance.”
We add fees that are specific to a particular charge to the same daily balance as that particular charge. We add all other applicable fees to your purchase balance as of the first day of a billing period.
- Browse Related Terms: "Go-to" rate, Average daily balance method with compounding, Average daily balance method without compounding, balance, Daily balance method with compounding, Daily balance method without compounding, Daily periodic rate (DPR), Default APR, Interest-free period, Introductory APR, Penalty APR, Periodic rate, Purchase APR
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DPR stands for “Daily Periodic Rate.” This is a daily interest rate. The daily periodic rate or DPR for a given balance is equal to the APR on that balance divided by 365.
- Browse Related Terms: "Go-to" rate, Average daily balance method with compounding, Average daily balance method without compounding, balance, Daily balance method with compounding, Daily balance method without compounding, Daily periodic rate (DPR), Default APR, Interest-free period, Introductory APR, Penalty APR, Periodic rate, Purchase APR
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The daily trading limit is the most that the price of a futures contract can rise or fall in a single session before trading in that contract is stopped for the day.
Trading limits are designed to protect investors from wild price fluctuations and the potential for major losses. They're comparable to the circuit breakers established by stock exchanges to suspend trading when prices fall by a specific percentage.
- Browse Related Terms: Cash settlement, Clearinghouse, Closing price, Commodity, Daily trading limit, derivative, Financial future, Fungible, Futures contract, Go long, Hedger, Open interest, Speculator, Trade date, Trading volume, Unit of trading, Weather derivative, Zero sum
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The date of maturity, or maturity date, is the day on which a bond's term ends, and its issuer repays the principal and makes the final interest payment.
When the phrase is used in connection with mortgages or other personal loans, the date of maturity is the day your last payment is due and your debt is repaid.
- Browse Related Terms: amortization, Asset-backed bond, Credit card account agreement, Date of maturity, Debt-to-income ratio (DTI), Deferred payment, Delinquency, Honorarium, Late Charge, Maturity Date, Payment Due Date, Prepayment, Self-amortizing loan
An order to buy or sell a security valid only for a limited period, normally less than a day.
- Browse Related Terms: bid and ask, Broker, day order, futures, Limit order, Liquidity, Margin, margin debt, Market order, open order, options, registered representative, stock yield
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A day order is an instruction you give to your broker to buy or sell a security at the market price or at a particular price you name before the end of the trading day. The order expires if it isn't filled.
In contrast, a good 'til canceled (GTC) order remains open on the broker's books until it's filled, you cancel it, or the brokerage firm's time limit for GTCs expires.
- Browse Related Terms: All or none order (AON), confirmation, day order, Fill or kill (FOK), Good 'til canceled (GTC), open order, Stop order
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When you continuously buy and sell investments within a very short time, perhaps a few minutes or hours, and rarely hold them overnight, you're considered a day trader.
The strategy is to take advantage of rapid price changes to make money quickly.
The risk is that as a day trader you can lose substantial amounts of money since no one can predict how or when prices will change. That risk is compounded by the fact that technology does not always keep pace with investors' orders, so if you authorize a sell at one price the price it's executed at may be higher or lower, wiping out potential profit.
In addition, you pay transaction costs on each buy and sell order. Your gains must be large enough to offset those costs if you're going to come out ahead.
- Browse Related Terms: capital gain or loss, Contingency order, Day trader, Floor trader, home equity, Limit order, Limit price, Markdown, markup, Stop price, Stop-limit order, Tailgating, Trader
Refers to establishing and liquidating the same position or positions within one day's trading.
- Browse Related Terms: confirmation, day trading, discretion, Settlement date, short sales, trade date v. settlement date
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Dealers, or principals, buy and sell securities for their own accounts, adding liquidity to the marketplace and seeking to profit from the spread between the prices at which they buy and sell.
In the over-the-counter market, in most cases, it is dealers - also called market makers - who provide the bid and ask quotes you see when you look up the price of a security.
Those dealers are willing to commit their capital to specific securities and are ready to trade the securities at the quoted prices.
- Browse Related Terms: Ask, BID, bid and ask, Dealer, Firm quote, Make a market, Market maker, Pink Sheets, Quotation (Quote), Trading floor
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Dealer Sticker Price, usually on a supplemental sticker, is the Monroney sticker price plus the suggested retail price of dealer-installed options, such as additional dealer markup (ADM) or additional dealer profit (ADP), and dealer preparation.
- Browse Related Terms: American-style option, Base Price, Dealer Sticker Price, European style option, Expiration cycle, Expiration date, Last trading day, Long-term equity anticipation securities (LEAPS), Options class, Options series, Quadruple witching day
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A death benefit is money your beneficiary collects from your life insurance policy if you die while the policy is still in force.
In most cases, the beneficiary receives the face value of the policy as a lump sum. However, the death benefit is reduced by the amount of any unpaid loans you've taken against the policy.
Some retirement plans, including Social Security, also provide a one-time death benefit to your beneficiary at the time of your death.
- Browse Related Terms: Accelerated death benefit, Asset, Cash surrender value, Cash value account, Credit Life Insurance (CLI), Death benefit, Decreasing term insurance, Depreciation, Face value, Insurance trust, Life settlement, Lump sum, Pension maximization, Permanent insurance, Straight life, Survivorship life, Universal life insurance, Viatical settlement, Whole life insurance
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Disqualification of a firm or individual from contracting with the government or participating in government non-procurement transactions for a specific period of time. The grounds for debarment may be either statutory or administrative.
- Browse Related Terms: Adjustable-Rate Mortgage (ARM), amortization, balloon mortgage, Convertible ARM, Debarment, Fixed-Rate Mortgage (FRM), Interest-only mortgage, Lock-In, Lock-in agreement, Mortgage life insurance, Negative amortization, Payment Cap, Right of rescission, Self-Amortizing Loans, Swap, term, Weighted Average Life (WAL)
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A debenture is an unsecured bond. Most bonds issued by corporations are debentures, which are backed by its reputation rather than by any collateral, such as the company's buildings or its inventory.
Although debentures sound riskier than secured bonds, they aren't when they're issued by well-established companies with good credit ratings.
- Browse Related Terms: Bearer bond, Coupon, Debenture, Junior security, Registered bond, Revenue bond, Subordinated debt, transfer agent, Unsecured bond
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A debit is the opposite of a credit. A debit may be an account entry representing money you owe a lender or money that has been taken from your account.
For example, your bank debits your checking account for the amount of a check you've written, and your broker debits your investment account for the cost of a security you've purchased.
Similarly, a debit card authorizes the bank to take money out of your bank account electronically, either as cash or as an on-the-spot payment to a merchant. That's different from a credit card, which authorizes you to borrow the money from the card issuer.
A debit may be an account entry representing money you owe a lender or money that has been taken from your deposit account.
- Browse Related Terms: Asset Management Account, Check (Share Draft), Customer Identification Program (CIP), Debit, Direct Deposit, Electronic bill payment, Electronic Check Conversion, Electronic funds transfer, Electronic Funds Transfer (EFT), Money order, Outstanding check, Preauthorized Payment, Stop payment, Stop Payment Fee, Sweep account
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A debit balance is what you owe. It's entered as accounts receivable on the books of the lender and appears on your account statement as a liability.
For example, if you have a margin account and borrow money to buy stock, your monthly brokerage statement will show a debit balance for the amount of the margin loan.
- Browse Related Terms: Closed-End Loan, Collateral, Debit balance, Guaranteed Student Loan, Lienholder, Loan, Loan Contract, Loan Fee, Loan Modification Provision, Loan proceeds, Loan-to-value ratio (LTV), Payday Loans, PITI, Rehypothecation, Secured Loan, Student Loan, Terms
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A card with direct access to a customer’s financial account, usually a checking or savings account. It generally can be used to withdraw money from ATMs, and/or for retail purchases - where funds are almost immediately withdrawn from the customer's account. Some cards require a personal identification number; others require a customer's signature.
A debit card allows the account owner to access their funds electronically. Debit cards may be used to obtain cash from automated teller machines, or purchase goods or services using point-of-sale systems. The use of a debit card involves immediate debiting and/or crediting of consumers' accounts.
A debit card - sometimes called a cash plus card - allows you to make point-of-sale (POS) purchases by swiping the card through the same type of machine you use to make credit card purchases.
Sometimes you authorize a debit card transaction with your personal identification number (PIN). Other times, you sign a receipt just as you would if you were charging the purchase to your credit card. You can also use the card to make ATM withdrawals.
When you use a debit card, the amount of your purchase is debited, or subtracted, from your account at the time of the transaction and transferred electronically to the seller's account.
You have some of the same protections against loss with a debit card as you do with a credit card, but there is one important difference. While $50 is the most you can ever be responsible for if your credit card is lost or stolen, you could lose much more with a lost or stolen debit card if you don't report that has happened within two days of discovering it.
If you delay reporting a missing card, you could lose up to $500. And if you wait more than 60 days after receiving a bank statement that includes a fraudulent use of your card, you could lose everything in your account including your overdraft line of credit. You can find the specific rules on the Federal Trade Commission website at www.ftc.gov.
In addition, if you purchase defective merchandise with a debit card there are no refunds. Most credit card issuers do not, generally speaking, make you pay for defective products.
- Browse Related Terms: ATM Card, Automatic Bill Payment, Available Balance, Balance Transfer, Billing Error, Debit card, Electronic benefits transfer (EBT), Previous Balance, Residual interest
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A plastic card, which looks similar to a credit card, that consumers may use to make purchases, withdrawals, or other types of electronic fund transfers. Funds are immediately drawn from the consumer’s checking account directly and simultaneously.
State of Maine, Department of Professional and Financial Regulation - Cite This Source - This Definition- Browse Related Terms: Advance Fee Loan Scam, Conforming Loan, construction loan, Credit Service Organization, Cure, Debit card, Default, Escrow Account, Jumbo, Loan/Mortgage Broker, processor, Third Party Fees
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Coverage for the cost of removing debris resulting from damage caused by an insured peril.
- Browse Related Terms: Builders Risk, Debris removal, Exclusions, HO Forms, Liability, Named perils, Occurrence, Peril, Proof of loss, Residual market, Sewer Back-up and Sump Pump Overflow Coverage
An obligation to repay a sum of principal, plus interest. In corporate terms, debt often refers to bonds or similar securities.
- Browse Related Terms: bond, capital gain or loss, cash equivalent, Debt, income fund, Interest, Maturity, money market, money-market fund, real return, realized and unrealized gain/loss, Risk, treasury bills (t-bills), Zero-coupon bond
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A debt is an obligation to repay an amount you owe. Debt securities, such as bonds or commercial paper, are forms of debt that bind the issuer, such as a corporation, bank, or government, to repay the security holder. Debts are also known as liabilities.
- Browse Related Terms: accrued interest, Bonds (Corporate), Coupon Rate, Debt, Full faith and credit, General obligation (GO) bond, Insured bond, Senior bond, Treasuries
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Cancels your debt if you become unemployed, disabled, or meet other criteria covered by your contract.
- Browse Related Terms: Address on file, Assign, Credit bureau, Credit History, Credit limit, Credit Report, Credit reporting agency, Credit score, Debt cancellation coverage, Debt suspension coverage, Default, Foreign currency transaction, Retail credit card, Treasury bill rate, Workout agreement
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Any person who regularly collects debts owed to others.
- Browse Related Terms: Collection agency, Consumer Credit Counseling Service, creditor, Debt collector, Debtor, Fair Debt Collection Practices Act (FDCPA), Liability, net worth, Prepayment Clause, Principal
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