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What Is Sensitivity? In finance, sensitivity is the magnitude of a market instrument’s reaction to changes in underlying factors, most often in terms of its price response to other factors. Financial instruments, such as stocks and bonds, are constantly influenced directly and indirectly by a myriad of factors. Sensitivity accounts for these factors that impact

What Is Sensitivity Analysis? Sensitivity analysis determines how different values of an independent variable affect a particular dependent variable under a given set of assumptions. In other words, sensitivity analyses study how various sources of uncertainty in a mathematical model contribute to the model’s overall uncertainty. This technique is used within specific boundaries that depend

What Is a Sentiment Indicator?  A sentiment indicator is designed to represent how a group feels about the market or economy. These market psychology-based indicators attempt to quantify sentiment, in the form of figures or graphically, to predict how current beliefs and positions may affect future market behavior Sentiment indicators look at how bullish or

What Is a Simplified Employee Pension (SEP)? A simplified employee pension (SEP) is an individual retirement account (IRA) that an employer or a self-employed person can establish. The employer is allowed a tax deduction for contributions made to a SEP IRA and makes contributions to each eligible employee’s plan on a discretionary basis. Additionally, under

What Is a Separate Account? A separate account is an investment portfolio owned by an investor and managed by a professional investment firm—typically registered investment advisors (RIA). Although separate accounts are usually opened through a brokerage or financial advisor, they may also be held at a bank or opened with an insurance company. Sometimes these accounts are

What Is a Separate Return? A separate return is a Form 1040 or similar tax form filed by married taxpayers who are separately filing taxes with their spouses. Separate returns are commonly associated with married couples who have initiated divorce proceedings, or with married partners who dwell in separate residences. Key Takeaways A separate return is

What Is Separation of Powers? Separation of powers is an organizational structure where responsibilities, authorities, and powers are divided between groups rather than being centrally held. Separation of powers is most closely associated with political systems, in which the legislative, executive, and judicial powers of government are vested in separate bodies. Key Takeaways Separation of

What Is the September Effect? The September effect refers to the historically weak stock market returns observed during the month of September. In fact, September has been the worst performing month, on average, going back nearly a century. The September Effect is a case of a calendar-based market anomaly, in the sense that it occurs without

What Is Sequential Growth? Sequential growth is a measure of a company’s short-term financial performance that compares the results in a recent period to those of the period immediately preceding it. In financial reporting, sequential growth often compares results between two quarters. A company might report 3% sequential sales growth, meaning that its revenue has

What Is a Sequestered Account? A sequestered account is a deposit account that is seized through legal action or court order. Funds cannot be removed from a sequestered account without the approval of the seizing party. Sequestered accounts are usually separated from other accounts and kept in a separate file. The term sequestered account is