Value-added tax
Tax added onto a product during each step of production, from raw material to finished good.

Variable annuities
Investment contracts whose issuer pays a periodic amount linked to the investment performance of an underlying portfolio.

Variable cost
A cost that is directly proportional to the volume of output produced. When production is zero, the variable cost is equal to zero.

Variable life insurance policy
A whole life insurance policy that provides a death benefit dependent on the insured's portfoliomarket value at the time of death. Typically the company invests premiums in common stocks, so variable life policies are referred to as equity-linked policies.

Variable rate
Interest rate can be altered by the account provider as and when they deem necessary, usually when general base rates change. This is also the traditional way that mortgages were arranged before the concept of fixed rates. A variable rate will fluctuate up and down to reflect the true cost of borrowing. Some variable rates may be discounted for a period of time (see Discounted Rates).

Volatility
Measurement of the propensity of a stock, bond, mutual fund, commodity, or market to rise or fall sharply in price. Various factors may make a stock or mutual fund volatile. Variation based on the intrinsic values of a security, as opposed to general market conditions, is measured by the alpha coefficient. The beta coefficient measures the volatility of a stock relative to the overall market.