The Prop Trader's Dictionary

From drawdown rules to payout splits — every term you need to understand, master, and pass your challenge.

N

Net Debt

Net debt is a financial metric that represents a company's total debt minus its cash and cash equivalents. It provides a clearer picture of a company's financial obligations by showing how much debt would remain if all available cash were used to pay it down. A negative net debt, sometimes called net cash, indicates a company has more cash than debt.

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Net Operating Income

Net Operating Income (NOI) is a measure of a company's or property's profitability from its core operations, calculated by subtracting operating expenses from total revenue, excluding taxes and interest payments. It is widely used in real estate and corporate finance to evaluate the income-generating potential of an asset. NOI gives a clear view of operational performance before the effects of financing are considered.

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Net Present Value

Net Present Value (NPV) is a financial metric that calculates the difference between the present value of future cash inflows and the present value of future cash outflows over a set period. It accounts for the time value of money, recognising that a dollar received in the future is worth less than a dollar received today. A positive NPV indicates a potentially profitable investment.

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3+ terms

Explore all glossary terms currently grouped under the letter "N".