TOP-DOWN APPROACH TO INVESTING Definition

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TOP-DOWN APPROACH TO INVESTING is an investment approach that first seeks to define major economic and industry trends, then proceeds to identify the individual companies most likely to benefit from those trends. See BOTTOM-UP APPROACH TO INVESTING.

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4 Cs OF CREDIT are the four primary considerations that will affect a lenders decision to approve or decline your loan application. Known as the 4 C's of credit:

  1. Capacity - what is your ability to repay the loan? Do you have a job or another income source? Do you have other debts?
  2. Character - will you repay the loan? Have you used credit before? Do you pay your bills on time?
  3. Collateral - if you fail to repay your loan, is there something of value that you agree to forfeit? For example, if you are buying your first car, it could be used as collateral to insure that you will repay the loan. If you default, you lose your car.
  4. Capital (accumulation) - what are you worth? Do you have other assets, such as a savings account, car, or certificate of deposit that could be used to repay the debt?

BACKORDER is a customer order or contractual line item, current or past due, that cannot be shipped due to lack of inventory; dependent upon availability it will be shipped at some future date.

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