It’s not easy to understand all the words concerning the world of economics, especially when it’s about a foreign language, but don’t worry: we’re here to explain the main Italian words about this kind of world! Follow us to discover the terminology of the financial market.
Finance and Economics in Italian
In this article, we divided the text into two parts: the first one is about economics in general and the second one is on financial markets and investments.
Economic vocabulary in Italian
- Bilancio di previsione (budget) consists in a document which contains estimations for a following period. This contains the guideline to reach the objectives the company sets out.
- Bolla speculativa (speculative bubble) it’s a market phase characterized by a rapid and unjustified rise of the price of a good until the bursting of the bubble, by which the original value of the good is restored. The economy is influenced by speculative bubbles whenever they grow too much or protract, because they could pop at any moment. An example is the property bubble.
- Boom is a period of unsustainable economic expansion characterized by the overinvestment in certain industries, in which economy is in a positive phase. The opposite è the so-called bust phase, where investments and production are reduced, and this often creates a recession.
- Credito (credit) it indicates the cash advance from a person or an organization to another under a promise of future in one or more solutions, in accordance with the time limits and procedures, contractually specified. Who received the loan owes the other.
- Deficit and surplus indicate two opposite conditions: the deficit indicates an economic situation of a company in which costs exceed the benefits, or of a public body in which expenditures exceed revenues; the surplus occurs, instead, when the revenues are greater.
- Fiscale (fiscal) is an adjective which indicates everything that has to do with money. We often talk about fiscal year, that indicates the time frame after which reports, declarations and more official documents are requested. In Italy the anno fiscale follows the calendar year (1st January – 31 December) with an exception consisting of some companies from the public sector.
- Inflazione (inflation) indicates the rise of price for goods and services, involving a decline in purchasing power. The opposite is the deflation, characterized by the decrease in the prices from which derives a decrease in the companies’ turnover and increase in unemployment. As we have seen, none of the two is positive for the economy.
- Prodotto Interno Lordo (PIL, Gross domestic product) is the value of products and services made within the State over a specific period of time. The PIL (GDP) results from an exchange process that is the sale of products and services.
- Recessione (recession) is an economic situation characterized by a PIL (GDP) reduction for two consecutive terms. If the economy continues to worsen, we’re talking about depression (depressione).
- Stagnazione (stagnation) occurs when there’s no PIL (GDP) delevopment. This one can go up and down, and the stagnation is negative because typically the objective is to make it grow.
- Trimestre (quarter) corrisponds to the most common subdivision of the year regarding the world of economy and it indicates three months.
- Valuta (currency) is the currency used in a certain country (euro in Europe, American dollars, ecc.).
Finance vocabulary in Italian
- Azione (action) in economics indicates the percentage of a society (joint stock company, SpA) owned by shareholders. With the purchase of shares you become in part owner of the corporation and you can obtain rights and the sale of shares by a company makes it grow. The combination of financial assets as actions is called portafoglio (portfolio).
- Broker (intermediario) in the person who organizes the transactions on the offer side on behalf of customers in the corporation of investment services.
- Bull Market e Bear Market (Orso e Toro) indicate two opposite market trends: a bull is someone who buys financial instruments wainting for a rise of prices; a bear is somebody who sells financial instruments waiting for a price drop.
- Dividendo (dividend) is the distribution of profits by a corporation to its shareholders in relation to the invested capital.
- Fondo comune di investimento (mutual investment fund) is where the capital raised by savers is invested in what the manager think is worth it and everyone obtains some percentage.
- Indice (stock index) is a list of quoted financial instruments selected to represent a sector or a region. Looking at the index performance, investors can evaluate the direction of one or more markets and take an important decision.
- Investimento conservativo (conservative investment) is a kind of investment which relies on low-risk big corporations (blue-chip) which get a good return.
- Obbligazione (bond) is a debt claim issued by a society or public body as the State or a municipality to collect money. Bonds are, therefore, safer garanteed, but imply a reduced output.
- Offerta pubblica iniziale (IPO from the english initial public offering) is an offer to the public of shares of a company that intends to go public on the regulated market.
- Patrimonio netto (net worth) is the difference between the activities and the liabilities of a company. Activities are a complex of goods, rights and services available to the company; liabilities are represented by the company debts.
- Return on Investment (ROI) is what we think we could achieve from an investment. The financial market works, in fact, as gambling and people try to get the maximum return.
- Volatilità (volatility) is the indicator measuring the uncertainty or the variability of performance of financial activities. In fact, the value of there activities can drop or rise all of a sudden for various factors.
Hoping that you liked this lesson, we suggest you to take a look also at the lesson vocabulary of BUSINESS ITALIAN: very useful if you want to work in Italy!