Glossary List R

Rainbow option

Rainbow option is an option wherein a single option is utilized or linked to two or more underlying assets. This move can be effected in the desired direction if the aforesaid assets show identical movements in favor of the option.

Rate Tart

In order to reduce interest rates on repayment, credit card users’ transfer balances from one card to another. Rate tarts show significant balances when a special offer on the credit card, offering members with an interest close to zero percent, closes out.

Ratio spread

Ratio spread is clearly defined as an investment strategy wherein a shareholder simultaneously holds on to unequal number of short as well as long positions. A commonly used ratio comprises of two short options for every trading derivative or option purchased.

Recession

Recession is a sluggish state of economy a country is grappled with. Employment opportunities are diminished, demand for goods and services reduce while the stocks of goods remain unsold.

Recurring expenses

Recurring expenses relate to the day to day expenses of an entity. These include payment of salaries or wages to employees, utilities, rent, and other incidental expenses.

Redemption

Redemption is a process by which the investor is entitled to receive the principal money plus affiliated rate of interest through sale of mutual fund investments, bonds, Fixed deposits and so on. Mutual funds can be redeemed by selling mutual fund shares.

Regulator

A regulator can be an entity, corporate, bank or a Governmental agency aimed at governing the set of rules and regulations of the entity under consideration. A regulator can be a market-maker, as well.

Regulatory risk

Regulatory risk is defined as the risk involved with change of rules, laws or regulations by the Government or a legal entity. These can affect a business sector or the real-estate market.

Re-materialization

Re-materialization is a process by which shares and securities prevalent in the de-mat form are converted into physical copies of share certificates. The nominee will have to fill in a Re-mat Request Form or RRF to get things sorted out.

Repo rate

Repo rate is defined as the rate at which the Central bank of the nation lends money to commercial banks in the eventuality of any shortfall of funds. For India, it is RBI (Reserve Bank of India) that is considered to be the Central Bank.

Re-purchase of units

Re-purchase is a process by which a company purchases some of its shares from the general public in order to reduce the number of outstanding shares a company has. These were the shares that were offered to the public at the IPO (Initial Public Offering)

Reserve Bank of India

Reserve Bank of India is otherwise known as the Central Bank of India. RBI is the bank that directs issuance of fresh currency notes by printing the same and also regulates the banking activities of each and every bank set up across the country.

Retail investor

A retail investor is an independent investor who buys and sells shares or securities from his personal account and not for another company or organization.

Retained earnings

Retained earnings form that portion of the net income earned by a company or business entity and are re-invested back into the business for its core range of activities like diversification of the business. These earnings are not paid to shareholders in the form of dividends.

Rights issue

Rights issue is a kind of an invitation to existing shareholders to buy additional shares from the same company. The investors might get these shares at a discounted price and not the market price.

Riskometer

Riskometer is a statistical measure of determining or accessing the level of risk a fund carries. Equity can have certain amount of risk factor involved and so are mutual funds.

RTA

A central depository system need to have list of companies issuing shares, securities or debentures via the electronic terminal or connectivity. RTA (Registrar of Transfer Agency) can help the depository upload companies issuing shares or securities and listed on the stock exchange.

RTGS

RTGS stands for Real Time Gross Settlement. It is a payment system in which funds are transferred from the payee’s account to the beneficiary’s account almost immediately. RTGS settlements usually happen in batches.