What Is Principal, Interest, Taxes, Insurance—PITI? Principal, interest, taxes, insurance (PITI) are the sum components of a mortgage payment. Specifically, they consist of the principal amount, loan interest, property tax, and the homeowners insurance and private mortgage insurance premiums. PITI is typically quoted on a monthly basis and is compared to a borrower’s monthly gross
What is a Pivot? A pivot is a significant price level known in advance which traders view as important and may make trading decisions around that level. As a technical indicator, a pivot price is similar to a resistance or support level. If the pivot level is exceeded, the price is expected to continue in
What Is a Pivot Point? A pivot point is a technical analysis indicator, or calculations, used to determine the overall trend of the market over different time frames. The pivot point itself is simply the average of the intraday high and low, and the closing price from the previous trading day. On the subsequent day
What Is Placed-In-Service? Placed-in-service is the point in time when a property or long-term asset is first placed in use for the purpose of accounting, primarily to calculate depreciation or grant a tax credit. The date the asset is placed in service marks the beginning of the depreciation period. Placed-in-service also applies to property in
What Is a Placement? A placement is the sale of securities to a small number of private investors that is exempt from registration with the Securities and Exchange Commission under Regulation D, as are fixed annuities. This exemption makes a placement a less expensive way for a company to raise capital compared with a public
What Is a Placement Agent? A placement agent is an intermediary who raises capital for investment funds. A placement agent can range in size from a one-person independent firm to a large division of a global investment bank. Professional placement agents are required to be registered with the securities regulatory agency in their jurisdiction, such
What Is Plain Vanilla? Plain vanilla is the most basic or standard version of a financial instrument, usually options, bonds, futures, and swaps. It is the opposite of an exotic instrument, which alters the components of a traditional financial instrument, resulting in a more complex security. Key Takeaways Plain vanilla is the most basic version
What Is Petty Cash? A petty cash fund is a small amount of company cash, often kept on hand (e.g., in a locked drawer or box), to pay for minor or incidental expenses, such as office supplies or employee reimbursements. A petty cash fund will undergo periodic reconciliations, with transactions also recorded on the financial
What Is Pfandbriefe? Pfandbriefe are a type of covered bonds issued by German mortgage banks that is collateralized by long-term assets. These types of bonds represent the largest segment of the German private debt market and are considered to be the safest debt instruments in the private market. The singular term is ‘pfandbrief.’ Understanding Pfandbriefe
What Is a Passive Foreign Investment Company (PFIC)? A passive foreign investment company (PFIC) is a corporation, located abroad, which exhibits either one of two conditions, based on either income or assets: At least 75% of the corporation’s gross income is “passive”—that is, derived from investments or other sources not related to regular business operations.
