K

• KPI (key performance indicator)

  A metric used to measure the performance of a company or investment against specific goals or benchmarks.

• Kappa

  The measurement of an option contract's price sensitivity to changes in the volatility of the underlying asset. Volatility accounts for recent changes in price, historical changes in price, and future price moves.

• Key performance indicator

  (KPI) a set of quantifiable measurements used to gauge a company’s overall long-term performance. KPIs help determine a company's strategic, financial, and operational achievements, especially compared to those of competitors.

• Key rate duration

  Measures how the value of a debt security or a debt instrument portfolio changes at a specific maturity point along the entirety of the yield curve. When keeping other maturities constant, the key rate duration is used to measure the sensitivity in a debt security's price to a 1% change in yield for a specific maturity.

• Kickback

  An illegal payment intended as compensation for preferential treatment or any other type of improper services received. The kickback may be money, a gift, credit, or anything of value. Paying or receiving kickbacks is a corrupt practice that interferes with an employee's or a public official’s ability to make unbiased decisions. Kickbacks are often referred to as a type of bribery.

• kicker

  A right, exercisable warrant, or other feature that is added to a debt instrument to make it more desirable to potential investors by giving the debt holder the potential option to purchase shares of the issuer.

• Kiting

  The fraudulent use of a financial instrument to obtain additional credit that is not authorized.

• Knock-out option

  An option with a built-in mechanism to expire worthless if a specified price level in the underlying asset is reached. A knock-out option sets a cap on the level an option can reach in the holder's favor.

• Know your customer (KYC)

  The due diligence process undertaken by financial institutions and investment firms to verify the identity and assess the risk profile of their clients or customers, as required by anti-money laundering (AML) regulations. KYC are standards used in the investment and financial services industry to verify customers and know their risk and financial profiles.

• Knowledge capital

  Refers to the intangible value of an organization made up of its knowledge, relationships, learned techniques, procedures, and innovations. In other words, knowledge capital is the full body of knowledge an organization possesses. A company's knowledge capital depends on the skills and talents of its workers, which is what makes it an intangible asset.

• Knowledge process outsourcing

  (KPO) is the outsourcing of core, information-related business activities. KPO involves contracting out work to individuals that typically have advanced degrees and expertise in a specialized area.