term (redirected from term of years)

Term

1. The lifespan assigned to an asset or a liability, over which the value of the asset/liability is expected to either grow or shrink, depending on its nature.

2. The period of time assigned as the lifespan of any investment. In the case of debt, the time it takes for all payments to be made by the borrower and received by the lender. In the case of an equity investment, the time that elapses between the acquisition of the equity and its sale or removal from holdings for another reason.

Notes:

The life of an asset or investment generally falls into one of two main categories: short term and long term. An investment can be held for a very, very short period of time - for instance, a day trader might buy and sell a stock within seconds. On the other hand, the life of an investment can be as long as the life of a piece of land, which can span several generations and pass through the hands of many investors.

See also: Asset, Liability, Long Term, Medium Term, Short Term, Term Out

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Term

The period of time during which a contract is in force.

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term

1. The period during which a bond will remain outstanding.

2. The length of time that a person is to serve in a usually official capacity. For example, a firm's directors may be elected for terms of three years each.