HOME EQUITY LOAN Definition

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HOME EQUITY LOAN is a type of loan in which the borrower uses the equity in their home as collateral. These loans are sometimes useful to help finance a business, major home repairs, medical bills or college education.

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LADDER is a form of diversification in which investments with widely varying maturities are held within an invest­ment portfolio. Spreading investments over a range of maturities reduces interest rate risk on reinvestment by averaging out interest rate cycles. This strategy assures a continuous cash flow over time with some potential sacrifice of optimum total return.

FINANCIAL RATIO is the result of dividing one financial statement item by another. Ratios help analysts interpret financial statements by focusing on specific relationships.

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