Investment and Finance

"Cap" refers to a company's stock market capitalization. This is a gauge of what the market or investors believes the entire company to be worth.
Capitalization is the company's stock price per share multiplied by the total number of shares outstanding.
Market "caps" can change daily if there is a change in the stock price. Small cap is less than $1.5 billion, Mid cap is between $1.5 billion and $10 billion and Large cap is over $10 billion.
Different index's are used to report on large-cap stocks.
The most well-known and widely used is the Standard and Poors 500. Other large-cap index's are the Russell 1000 and the Wilshire Large Cap 750 Index.
The majority of large-cap stocks are in the financial services, technology and healthcare industries.

Generally, there are 4 types of Mutual Funds. The four general mutual fund types are Stock funds that buy stocks. Their investment objective is usually specific to a certain stock type such as small cap, large cap, international. Bond funds hold only bonds. As with stock funds, they can be designed to purchase particular grades of bonds. Balanced funds invest in a mix of stocks and bonds. Money market funds usually stick with safe, short-term debt instruments such as commercial paper, banker's acceptances, repurchase agreements and certificates of deposit. They have low risk. They typically provide the lowest returns among mutual funds. Their main uses are to hold money between investments, hold emergency savings and to save for short-term goals. As of 10/2000, the U.S. has over 7,000 mutual funds.

Section 403(b) retirement plans are defined-contribution retirement plans that offer workers a tax deferred investment and savings program. They are similar to 401(k) plans.
They are commonly used by non-profit institutions such as hospitals, public school systems and charitable organizations.
With a 403(b)retirement plan, money is deducted from your paycheck before taxes and deposited in a custodial account made up of mutual funds, depending on your particular plan. Employers have the option of matching part or all of the contribution.

Generally, you have three options for what to do with the vested portion of your 401(k) retirement account. If your vested account balance is $5,000 or more and you are under age 65 then you can leave your money where it is and taxes will not be due until you withdraw money from the account. You can roll over your 401(k) retirement account into a rollover IRA account or into your new employer's 401(k) retirement plan. If you do a direct rollover you should have the money transferred directly into the new account so you will not owe taxes until you withdraw money from the account. If you elect to take your money out of the 401(k) retirement account and not roll it over into a Rollover IRA or another 401(k) plan, you will owe all applicable taxes (plus the 10% early withdrawal penalty if you are under age 59 and a half.)

Employees over age 50 are entitled to additional catch-up contributions of another $6,000

The "vested" portion of your 401(k) account is the part that belongs to you and cannot be forfeited if you leave the job.
There are two parts of 401(k) contributions. The contributions you make and the contributions your employer makes such as a "matching" contributions.
The money you contribute, adjusted for any investment gain or loss, is always 100% vested. That means this money is always 100% yours. The contribution your employer makes may be subject to a vesting requirement.
This means that you must earn your employer’s contribution over a period of time. Vesting requirements are very common in 401(k) plans. The two most common types of vesting schedules are named Graded vesting and Cliff vesting. With graded vesting you own an increasing portion of the employer contribution each year you work with your company. If your company had a 4 year vesting schedule, you would be 25% vested after one year, 50% vested after two years, etc. By law, the longest vesting schedule a 401(k) plan can have is 7 years. Employees must be at least 20% vested after 3 years, 40% vested after 4 years, 60% after 5 years, 80% after 6 years and 100% after 7 years. With Cliff vesting you become 100% vested after a set period of time. If your vesting requirement is 4 years and you leave your company after 3 years, you will not get any of the employer contributions. The vesting requirement is an incentive for employees to stay employed with the company.

Your pre-tax 401(k) contributions are deducted from your gross pay before Federal income taxes are withheld. You do not pay federal taxes on this money until you withdraw it from your 401(k) account. You are required to pay Social Security tax on all 401(k) contributions. For state income tax, most states exempt 401(k) contributions from taxation. Depending on where you live your contributions may be subject to atate and or local income taxes.

The process of buying a stock share or commodity in one market and selling it in another market. A trader will engage in arbitrage when shares of the same security are trading at different prices in each market.

The Consumer Price Index is a measure of the average change over time in the prices paid by urban consumers for a fixed basket of day to day expenses including food, automobile, gas, registration, clothing, etc.