Call: A right to buy a specific asset at a predetermined price until a certain date. In the case of a bond, it is the issuer's right to repurchase an issue of bonds at a certain price on or after a specific date before the maturity date.

Capital appreciation: The increase in value of an asset.

Capital gain or loss: Profit or loss from the sale of an investment.

Cash account: A brokerage account that requires the customer to pay the full amount due by the settlement date for securities purchased.

Cash equivalents: Relatively safe and highly liquid investments, such as Treasury bills (T-bills) and money market funds, that can be easily converted to cash.

Cash Value: The equity value of a whole life insurance policy that is available to the policy owner as a loan or upon cancellation before it becomes payable upon death or maturity.

Certificate of deposit (CD): Time-deposit investments issued by a bank or savings and loan with a stated date of maturity and interest rate.

Charitable lead trust: A trust that makes payments to a charity for a period of time. The remainder goes to a family member or other beneficiary.

Charitable remainder annuity trust (CRAT): A trust that pays a fixed amount of income annually to a non-charitable beneficiary. The remainder goes to charity.

Charitable remainder unitrust (CRUT): A trust designed to permit periodic payment of a certain percentage of the fair market value of the trust to a noncharitable beneficiary. The remainder goes to a charity.

Closed-end fund: A type of mutual fund with a fixed number of shares that trades on an exchange or over the counter. (Most mutual funds have an unlimited number of shares and are bought and sold directly through a financial consultant or mutual fund company.)

Collateralized mortgage obligation (CMO): A mortgage-backed security collateralized by residential mortgages that are commonly guaranteed by government agencies and government-sponsored enterprises. (See mortgage-backed security.)

Common stock: Securities that represent an ownership interest in a corporation. Shareholders have the right to vote on major decisions (usually one vote per share owned). In the event a company is liquidated, common stockholders are last in line to receive any distribution of assets. However, to offset this risk, common stockholders generally have the greatest potential to benefit from price appreciation. (See stock.)

Community property: Property acquired during marriage in which both husband and wife have an undivided one-half interest. Not more than half of the property can be disposed of by a decedent's will or trust. Applicable in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin and Alaska (if elected).

Compounding: The increase in value of an investment resulting from the combination of the principal earning interest and that interest earning more interest.

Confirmation: Written acknowledgment of a security trade naming the specific security, price, commission or fee, and trade date of the transaction.

Conservator/guardian: A person or trust company appointed by a court to manage the assets and/or personal affairs of a minor or disabled person.

Contingent beneficiary: A person(s) who is entitled to receive the benefits of an insurance policy if the primary beneficiary is ineligible to receive the benefits or dies before the insured.

Corporate bond: A bond with a stated interest rate and maturity issued by a corporation.

Corporate bond funds: Mutual funds that invest primarily in long-term corporate bonds, passing the income from these securities to stockholders.

Corporate trustee: An institution that serves in a fiduciary capacity for a trust, such as an executor, administrator or trustee.

Coupon or "bearer" bond: A nonregistered bond in which the interest coupons are attached to the certificate, to be clipped as they come due and presented by the holder for payment of interest. These types of bonds are no longer issued, although some issues remain outstanding.

Credit shelter trust: An estate-planning tool that allocates part of an individual's estate into a separate trust with the remainder of the estate passing to the surviving spouse. The trust can help minimize or eliminate estate taxes due upon an individual's death or death of a spouse.

Crummey trust: A trust that provides a Crummey power to the beneficiary giving him or her a right to withdraw funds for a limited period of time. A Crummey notice must be given to the beneficiary notifying him or her of the funds and the right to withdraw them. This provision is a necessary component for some irrevocable trusts (including life insurance trusts) to qualify gifts for an annual exclusion amount exempt from estate taxes.

Current yield: The annual rate of return on an investment based on the income received during a year compared with the investment's current price.

CUSIP number: The individual identification number assigned to most securities in the United States.

Custodial account: An account created for the benefit of a minor with an adult as the custodian.