Financy Glossary
The online dictionary of financial terms

v

1

Value Date

The date on which a security is settled following a trade.

2

Vanilla bond

A bond that has no unusual features.

In English, the adjective vanilla is employed to describe something that is common, generic or bland.

3

Variable Rate Certificate

A certificate of deposit (COD) where the interest rate varies based on some other variable, such as the prime rate.

4

Venture Capital

Venture capital is a form of financing for small, early-stage, emerging firms.

Venture capital is typically invested in small, early-stage, emerging firms that the investors deem capable of growing fast. The investor will normally require equity (ownership stake) in the firm in exchange for the investment.

5

Venture Capital Trust (UK)

In the United Kingdom, a Venture Capital Trust (VCT) is an investment trust that invest in small unquoted companies. Certain conditions must be fulfilled for an investment trust to be considered a VCT in the eyes of the law.

Investing in a trust that is acknowledged as a VCT under U.K. law comes with several tax benefits for the investor:

  • 40% capital gains tax deferral (if shares are held for at least 3 years)
  • 20% income tax relief on the amount of the original investment
  • All dividends are tax fee
  • All gains on disposal after 3 years are tax exempt

When shares are sold, the original capital gains tax liability will be re-triggered

VCT:s only invest in companies where the total amount of assets are valued at less then £15 million.

VCT:s are quoted on the London Stock Exchange.

6

VIX

VIX is the ticker symbol for the CBOE Volatility Index.

This index intends to measure implied volatility of S&P 500 index options. It is nicknamed “the fear index” and “the fear gauge”.

The CBOE Volatility Index is calculated by the Chicago Board Options Exchange (CBOE).

7

Volume

In finance, the term volume typically refers to the number of shares, bonds or contracts traded for a security or on a whole exchange for a given period, also known as market turnover.

Thin trading is when the volume is low – for a security or for a whole exchange.

8

Volume Weighted Average Price (VWAP)

The volume weighted average price is the value of trades divided by the volume over a given period.

Example: During the last 60 minutes, three trades took place for shares in Company AAA on this exchange. First trade was 100 shares at $40 per share. Second trade was 200 shares at $35 per share. Third trade was 300 shares at $30 per share.

Value of trades: (100 x $40) + (200 x $35) + (300 x $30) = $4,000 + $7,000 + $9,000 = $20,000

Volume: 100 shares + 200 shares + 300 shares = 600 shares.

$20,000 / 600 shares = $33,33

The VWAP for those 60 minutes is $33,33.

9

Voluntary Liquidation

A voluntary liquidation of a company is one that has been approved by the shareholders of the company.

10

Voting Trust

A legal trust created to combine the voting power of at least two shareholders. For a set duration of time, the voting rights are transferred to a designated trustee.