Income Bond Fund
A mutual fund that seeks a high level of steady income by investing in a mix of corporate and government bonds.

Income Equity Fund
A mutual fund that seeks a high level of steady income by investing in stocks of companies with consistent records of paying dividends.

Income Fund
A mutual fund that seeks a high level of current income by investing in income producing securities, including both stocks and bonds.

Income Stock
Stock which yields a high dividend

Incorporation
The forming into a legal body endowed with various rights and duties.

Index Fund
Mutual fund whose portfolio matches a stock index, such as Standard and Poor, in an attempt to match the markets overall performance.

Individual Retirement Account (IRA)
Personal, tax-deffered retirement account that an employed person can set up with a deposit limited to $2,000 per year.

Inflation
Rise in the price of goods and services, as happens when spending increases relative to the supply of goods on the market - in other words, too much money chasing too few goods.

Initial Public Offering (IPO)
The first time a company issues stock to the public. This process often is called "going public

Insider Trading
In one respect, it refers to the legal trading of securities by corporate officers based on information available to the public. In another respect, it refers to the illegal trading of securities by any investor based on information not available to the public.

Instinet
A method by which large institutional clients can trade stocks during non-market hours.

Interest Rate
Put simply, it is the cost of money. The interest rate on a fixed income security is the rate an issuer has to pay an investor who lends his money to the issuer.

Interest-rate Swap
A derivative in which one party agrees to pay a fixed interest rate in return for receiving a floating interest rate from another party.

Intermediate-term Bonds
Bonds that mature in five to 10 years.

Internal Rate of Return
An accounting term for the rate of return on an asset. It is the discount rate on an investment that equates the present value of its cash outflows to the present value of its cash inflows.

International Monetary Fund (IMF)
An organization that makes loans and provides other services intended to stabilize world currencies and promote orderly and balanced trade. Member nations may obtain foreign currency when needed, making it possible to make adjustments in their balance of payments without currency depreciation.

Inverted Yield Curve
Unusual situation where short-term interest rates are higher than long-term rates. An inverted yield curve occurs when a surge in demand for short-term credit drives up short-term rates on instruments like Treasury bills and money market funds, while long-term rates move up more slowly, since borrowers are not willing to commit themselves to paying higher interest rates for many years.

Investment Advisers Act
Legislation passed by Congress in 1940 that requires all investment advisers to register with the SEC. The Act is designed to protect the public from fraud or misrepresentation by investment advisers.

Investment Bank
A securities firm, financial company or brokerage house that helps companies take new issues to market. Additionally, an investment bank handles the sales of large blocks of previously issued securities and private placements. Most investment banks also maintain brokerage operations and other financial services.

Investment Company Act of 1940
Legislation passed by Congress requiring registration and regulation of investment companies by the SEC. The Act sets the standard by which mutual funds and other investment vehicles of investment companies operate, in such areas as promotion, reporting and pricing of securities for sale to the public.

Issuer
An entity, such as a corporation or government, which has the authority to raise capital by selling securities.