gross margin

gross margin
margin, gross margin, net margin, security margin, variation margin
(1) An amount of cash or collateral that a buyer or borrower must provide in excess of value owed to that buyer or borrower by a seller, lender or depositor. Ensures performance by the buyer or borrower. Initial margin is posted at inception. Variation margin is the amount of any additional margin needed to correct deficiencies in the currently posted margin.
(2) The amount by which the coupon rate for a floating- or variable- rate financial instrument differs from the defined index for that coupon rate. For example, if a floating-rate note requires that the coupon rate be set at 250 basis points above 30-day LIBOR, the gross margin is 250 basis points. Can also be the amount added to, or subtracted from, the index in determining the instrument's fully indexed rate. Investors in adjustable rate mortgage-backed securities (MBSs) receive a coupon rate that is lower than the fully indexed rate because the cost of servicing, the servicing spread, is deducted. The gross spread minus the servicing spread is called the net margin or the security margin.
See index and servicing.
(3) In a firm's profit and loss statement, margin is the difference between sales price and the cost of goods sold. It may be expressed as a dollar quantity or as a percentage of the cost of goods sold. American Banker Glossary

* * *

gross margin gross margin margin

* * *

gross margin UK US noun [C] (also gross profit margin) FINANCE, ACCOUNTING
a company’s profit from selling goods or services in a particular period before costs not directly related to producing them are taken away. Gross margin is often shown as a percentage of sales: »

The software company has $30 million in revenues, 80% gross margin, and 5% pretax profit.

Financial and business terms. 2012.

Игры ⚽ Нужна курсовая?

Look at other dictionaries:

  • Gross margin — (also called gross profit margin or gross profit rate) is the difference between revenue and cost before accounting for certain other costs. Generally, it is calculated as the selling price of an item, less the cost of goods sold (production or… …   Wikipedia

  • gross margin — noun count BUSINESS GROSS PROFIT expressed as a percentage …   Usage of the words and phrases in modern English

  • gross margin — n technical the difference between what something costs to produce and what it is sold for …   Dictionary of contemporary English

  • gross margin — noun the ratio gross profits divided by net sales • Syn: ↑margin of profit, ↑profit margin • Hypernyms: ↑ratio * * * noun see margin I * * * gross margin or gross profit …   Useful english dictionary

  • Gross Margin — A company s total sales revenue minus its cost of goods sold, divided by the total sales revenue, expressed as a percentage. The gross margin represents the percent of total sales revenue that the company retains after incurring the direct costs… …   Investment dictionary

  • gross margin — UK / US noun [countable] Word forms gross margin : singular gross margin plural gross margins business gross profit expressed as a percentage …   English dictionary

  • Gross Margin Return On Investment - GMROI — An inventory profitability evaluation ratio that analyzes a firm s ability to turn inventory into cash above the cost of the inventory. It is calculated by dividing the gross margin by the average inventory cost and is used often in the retail… …   Investment dictionary

  • gross margin — The return an intermediary achieves on the selling price of the article. That is, if the intermediary buys a product for $1 and sells it for $1.50, the margin is calculated. For example, .50 divided by $1.50, or 33% …   Dictionary of automotive terms

  • gross margin — See: gross profit …   Accounting dictionary

  • gross margin — See gross profit …   Big dictionary of business and management

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”