Value-added tax: When a tax is added each time the product is resold or when value has been added, rather than only when it is directly sold at wholesale or retail. For example a value-added tax would be applied when a product is passed from a manufacturer to a wholesaler, and again from the wholesaler to the retailer.

Variable annuities:Investment contracts in which the issuer pays a periodic amount linked to the investment performance of the portfolio's holdings.

Variable cost: A cost that is directly proportional to the volume of output produced. The portion of total cost to manufacture an item or provide a service that varies when the rate of output varies. When production is zero, the variable cost is equal to zero.

Variable price security: Stocks or bonds that sell at fluctuating, rather than fixed, prices.

Variable rate loan: Loan made at an interest rate that fluctuates based on a base interest rate such as the Prime Rate, which is the interest rate that banks charge their best customers. For example, a variable loan at "Prime Rate plus five" would be charged at five percent interest rate above prime.

Venture capital: An investment in a start-up business that is perceived to have excellent growth prospects but does not have access to capital markets, such as proceeds from the sale of its stock. See also: Sand Hill Road.

Volatility: A numerical measure of risk of a company's stock due to its historic price fluctuations, as compared to the stock market as a whole, or other stocks in the industries it does business in.

Waiting period: Time during which the Securities and Exchange Commission (SEC) studies a firm's registration statement, which it has filed prior to putting its company stock for sale in the stock market. During this period, the SEC evaluates this statement for financial details, a history of the company's operations and management, and other facts of importance to potential buyers.

Watch list: A list of stocks selected for special surveillance by a brokerage, exchange or regulatory organization; firms on the list are often takeover targets, companies planning to issue new securities or stocks showing unusual activity.

Well-diversified portfolio: A collection of investments spread out over many stocks in such a way that the weight of any security is small.

Whole life insurance: A life insurance policy that pays off a stated amount upon the death of the insured, and accumulates a cash value that the policyholder can redeem or borrow against.

Window dressing: Slang for trading activity near the end of a quarter or fiscal year that is designed to dress up a portfolio to make it look attractive to shareholders or clients. For example, a portfolio manager may sell losing positions in a portfolio so they can display only positions that have gained in value.

Withdrawal plan: A plan that establishes automatic periodic mutual fund redemptions, with the proceeds mailed directly to the investor.

Working capital: How much money a company has to work with. The formula for calculating working capital involves the monetary difference between what a company owns in terms of the value of cash on hand, what other businesses owe it, value of inventory, stocks and other assets that could be converted into cash, minus what it owes in salaries, interest, accounts payable and certain types of other debt.

World Equity Benchmark Series (WEBS): The World Equity Benchmark Series are similar to SPDRs. WEBS trade on the AMEX, and track the Morgan Stanley Capital International (MSCI) country indexes. WEBS are available for Australia, Austria, Belgium, Canada, France, Germany, Hong Kong, Italy, Japan, Malaysia, Mexico, Netherlands, Singapore, Spain, Sweden, Switzerland and United Kingdom.

World Bank: A multinational company makes loans to developing countries for social overhead capital projects, such as the building of an electrical power grid to a rural area. These loans are guaranteed by the country that receives them.

Wrap account: A variety of investment services typically including investment advice, brokerage, and custody are provided by a financial services firm to a customer for one set fee. The services are combined together, or "wrapped."

Writer: The seller of an option, usually an individual, bank, or company, that confers the right to buy or sell stock at a given date at a certain price.

X or XD: Frequently used symbol in many U.S. newspapers that indicates a stock is traded without a dividend.

Year-to-Date:Used to define the elapsed time that a company's income or stock performance is being quoted for. The year-to-date can refer a chronological year, beginning on January 1, or a fiscal year, which may begin on July 1 (or some other date).

Yield: The percentage rate of return paid on a stock in the form of dividends, or the effective rate of interest paid on a bond or note.

Yield curve: The statistical difference between the yield on bonds of the same credit quality but of differing time frames before it is supposed to be repaid. This difference is usually shown in the form of a "curve" on a graph or chart.

Yield to maturity: The percentage rate of return paid on a bond, note or other fixed income security if you buy and hold it until the time it is scheduled to be redeemed.

Z bond: A bond that accumulates interest but is not paid at the time the interest is accumulated. Instead, the interest is added to the balance, and is paid at the time the bond matures, and is redeemed.

Zero prepayment assumption: The assumption of payment of scheduled principal and interest with no payments.

Zero-balance account: A checking account in which zero balance is maintained by transfers of funds from a master account in an amount only large enough to cover checks presented.

Zero-coupon bond: A bond issued at a discount in which no payment is made until the bond matures.