Financial definitions for business owners S

• Definition Shock Supply Explain An event that influences production capacity and costs in an economy
• Definition Analyst Supervisory Explain An analyst who is qualified to approve publicly distributed research reports on the NYSE
• Definition Income Security Supplemental Explain A Social Security program established to help the blind, disabled, and poor
• Definition Effects Side Explain Effects of a proposed project on other parts of the firm
• Definition Economics Side Supply Explain A theory of economics that reductions in tax rates will stimulate investment and in turn will benefit the entire society
• Definition Account Sweep Explain Account providing that a bank invest all the excess available funds at the close of each business day for the firm
• Definition Sweetener Explain A feature of a security that makes it more attractive to potential purchasers
• Definition Facility Swingline Explain Bank borrowing facility to provide finance while the firm replaces U.S. commercial paper with eurocommercial paper
• Definition Swiss Electronic Bourse (EBS) Explain former stock exchange trading floors in Zurich, Geneva, and Basel, Switzerland so that trades can be carried out among traders on all three
• Definition Swiss Options and Financial Futures Exchange (SOFFEX) Explain The Swiss derivatives market with the first fully electronic trading system in the world, now called Eurex Zurich AG
• Definition Swissy Explain Slang for the Swiss franc
• Definition Order Switch Explain Order for the purchase (sale) of one stock and the sale (purchase) of another stock at a stipulated price difference. Contingent order, swap
• Definition Switching Explain Liquidating a position and simultaneously reinstating a position in another futures contract of the same type
• Definition Sydney Futures Exchange (SFE) Explain The derivatives market of Australia
• Definition Symbol Explain Letters used to identify companies on the consolidated tape and other locations
• Definition Special Book Symbol Explain Illiquid, inactively traded stock not familiar market
• Definition Matching Cash Symmetric Explain allows for the short-term borrowing of funds to satisfy a liability prior to the liability due date, reducing the cost of funding
• Definition Data Synchronous Explain To test option-pricing models, the price of the option and of the underlying should be synchronous and reflect the same moment in the
• Definition Syndicate Explain a temporary basis, to loan money in a bank credit (syndicated credit) or to underwrite a new issue of bonds
• Definition Effect Synergistic Explain A violation of value-additivity in that the value of a combination is greater than the sum of the individual values
• Definition Convertible Synthetic Explain Combination of usable bonds and warrants (that expire on or after the bonds' maturity) that resembles convertible bond
• Definition Amendment Supermajority Explain amendment requiring that a substantial majority (usually 67% to 90%) of stockholders approve important transactions, such as mergers
• Definition Synthetics Explain by blending an underlying price on a cash instrument with the price of a derivative instrument. It is a combination of security holdings
• Definition Systematic Explain Common to all businesses
• Definition Plan Investment Systematic Explain An approach involving regular investments in order to take advantage of dollar-cost averaging
• Definition Risk Systematic Explain Also called undiversifiable risk or market risk
• Definition Principle Risk Systematic Explain matters in large, well-diversified portfolios. Thus, expected returns must be related only to systematic risks
• Definition Privilege Subscription Explain The right of current shareholders of a corporation to buy newly issued shares before they are available to the public
• Definition Warrant Subscription Explain security, usually issued with another security, such as a bond or stock, that entitles the holder to buy a proportionate amount of common
• Definition Subsidiary Explain that is part of a large corporation. A foreign subsidiary is a separately incorporated entity under the host country's law
• Definition Sale Substitute Explain uses debt market instruments, such as interest rate futures, or that involves selling borrowed securities as the primary assets
• Definition Swap Substitution Explain exchanges one bond for another bond that is similar in terms of coupon, maturity, and credit quality, but that offers a higher yield
• Definition Pill Suicide Explain that could destroy the target company. Taking on a large amount of debt to prevent the takeover might cause bankruptcy, for example
• Definition Rules Suitability Explain must use to ensure that investors have the financial means to assume risks that they wish to undertake. These are enforced by the NASD and
• Definition Sum-of-the-years'-digits depreciation Explain Method of accelerated depreciation
• Definition Costs Sunk Explain Costs that have been incurred and cannot be reversed
• Definition Industries Sunrise Explain Growth industries in an economy that may become leaders in the market in the future
• Definition Indicator Bowl Super Explain American Football League pre-1970 wins the Super Bowl, the stock market will decline during the coming year. If a team from the old pre
• Definition Bond Sinker Super Explain any other bond that has long-term coupons but short maturity; the mortgages may be prepaid, and the holders may receive the long-term
• Definition Supermajority Explain Provision in a company's charter requiring a majority of, say, 80% of shareholders to approve certain changes, such as a merger
• Definition Level Support Explain supposedly difficult for a security or market to fall. That is, the price level at which a security tends to stop falling because there is
• Definition Surcharge Explain An additional levy added to some charge
• Definition Surety Explain An individual or corporation that guarantees the performance or actions of another
• Definition Funds Surplus Explain Cash flow available after payment of taxes in a project
• Definition Management Surplus Explain Related: Asset management
• Definition Surtax Explain A tax added to the normal tax paid by corporations or individuals who have earned income above a certain level
• Definition Surveillance department of exchanges Explain A department that monitors trading activity on an exchange in order to identify any unusual activity that may indicate illegal practices
• Definition Bond Sushi Explain A Eurobond issued by a Japanese corporation
• Definition Trading Suspended Explain particular security, in advance of a major news announcement or to correct an imbalance of orders to buy and sell
• Definition Account Suspense Explain An account used temporarily to record receipts and disbursements that have yet to be classified
• Definition Rate Growth Sustainable Explain Maximum rate of growth a firm can sustain without increasing financial leverage
• Definition Swap Explain lend to each other on different terms, e.g., in different currencies, and/or at different interest rates, fixed or floating
• Definition Assignment Swap Explain Related: Swap sale
• Definition Back Buy Swap Explain The sale of an interest rate swap by one counterparty to the other, effectively ending the swap
• Definition Swaption Explain buyer of a swaption has the right to enter into an interest rate swap agreement by some specified date in the future. The swaption
• Definition Rate Swap Explain The difference between spot and forward rates expressed in points, e.g., $0.0001 per pound sterling
• Definition Reversal Swap Explain counterparty's role in another interest rate swap, accomplished by counterbalancing the original swap in maturity, reference rate
• Definition Sale Swap Explain transaction that ends one counterparty's role in an interest rate swap by substituting a new counterparty whose credit is acceptable
• Definition Equity Sweat Explain An increase in equity created by the labor of the owner
• Definition Stratified sampling bond indexing Explain the index into cells, each cell representing a different characteristic, and that buys bonds to match those characteristics
• Definition Stray Explain party in the trade at hand; (2) not a meaningful indication of a customer's desire to take a sizable position or be involved in a
• Definition Street Explain Means Wall Street financial community; brokers, dealers, underwriters, and other knowledgeable participants
• Definition Name Street Explain Registration under which securities maybe held by a broker on behalf of a client but be registered in the name of the Wall Street firm
• Definition Index Strike Explain value at which the buyer of the option can buy or sell the underlying stock index. The strike index is converted to a dollar value by
• Definition Price Strike Explain underlying stock may be purchased (in the case of a call) or sold (in the case of a put) by the option holder upon exercise of the option
• Definition Strip Explain puts and one call on a stock. A strap is two calls and one put on a stock. The puts and calls have the same strike price and expiration
• Definition Strip mortgage participation certificate (strip PC) Explain mortgages purchased by Freddie Mac from a single seller in exchange for separate instruments representing interests in the same mortgages
• Definition Bond Stripped Explain Bond that can be subdivided into a series of zero-coupon bonds
• Definition Yield Stripped Explain securities. Return on the debt portion of a bond/warrant unit after subtracting the value of the issued warrant segment
• Definition Dollar Strong Explain When the dollar can be exchanged for a large amount of foreign currency, benefiting travelers but hurting exporters
• Definition Efficiency Form Strong Explain posits that the price of a security reflects all information, whether or not it is publicly available. Related: Weak-form efficiency, semi
• Definition Transaction Arbitrage Structured Explain A self-funding, self-hedged series of transactions that usually use mortgage-backed securities (MBS) as the primary assets
• Definition Debt Structured Explain Debt that has been customized for the buyer, often by incorporating unusual options
• Definition Note Structured Explain change in value with movements of an underlying index; or a note whose issuer makes swap arrangements to alter its required cash flows
• Definition Strategy Portfolio Structured Explain Desigining a portfolio to achieve a level of performance that matches some predetermined liabilities that must be paid out in the future
• Definition Settlement Structured Explain involving specific payments made over a period of time. Property and casualty insurance companies often buy life insurance products to pay
• Definition Stub Explain Often used in risk arbitrage. Piece of equity security left over from a major cash or security distribution from a recapitalization
• Definition M Subchapter Explain investment companies and real estate investment trusts that avoid double taxation by distributing interest, dividends, and capital gains
• Definition S Subchapter Explain with 35 or fewer shareholders the option of being taxed as a partnership to escape corporate income taxes
• Definition Subject Explain executed without confirmation from the customer. In other words, not firm, but a bid/offer that needs additional information/confirmation
• Definition Subject to a (NY) can Explain Contingent upon trader's ability to cancel an order (on the indicated exchange
• Definition Opinion To Subject Explain acceptance of a company's financial statements subject to pervasive uncertainty that cannot be adequately measured, such as
• Definition Subject to a print/execution/trading Explain Contingent on execution of a trade because the picture in the stock has not been materially altered
• Definition Probabilities Subjective Explain Probabilities that are determined subjectively (for example, on the basis of judgment rather than statistical sampling
• Definition Bond Debenture Subordinated Explain secured debt, after debenture bonds, and often after some general creditors in its claim on assets and earnings. Related: Debenture bond
• Definition Debt Subordinated Explain priority. In the event of bankruptcy, subordinated debtholders receive payment only after senior debt claims are paid in full
• Definition Clause Subordination Explain restricts the issuer's future borrowing by subordinating future lenders' claims on the firm to those of the existing bondholders
• Definition F Subpart Explain Special category of foreign-source unearned income that is currently taxed by the IRS whether or not it is remitted to the U.S
• Definition Return Subperiod Explain The return of a portfolio over a shorter period of time than the evaluation period
• Definition Subrogation Explain that has paid out to a policyholder for a loss incurred recovers the amount of the loss from the party that is legally liable
• Definition Subscription Explain Agreement to buy new issue of securities
• Definition Agreement Subscription Explain An application reviewed by the general partner to join a limited partnership
• Definition Price Subscription Explain Price that current shareholders pay for a share of stock in a rights offering
• Definition Power Stock Explain ownership of a security to another person, brokerage firm, bank, or lender after it has been sold or pledged to that party
• Definition Plan Purchase Stock Explain A plan allowing employees of a company to purchase shares of the company, often at a discount or with matching employer funds
• Definition Rating Stock Explain An evaluation by a rating agency of the expected financial performance or inherent risk of common stocks
• Definition Record Stock Explain The accounting a brokerage firm keeps of all securities held in inventory
• Definition Strategy Replacement Stock Explain 039;s return, used when the futures contract is expensive according to its theoretical price. The strategy involves a swap between the
• Definition Repurchase Stock Explain A firm's repurchase of outstanding shares of its common stock
• Definition Right Stock Explain Another terminology for a stock option
• Definition Selection Stock Explain technique that focuses on advantageous selection of particular stock rather than on broad asset allocation choices
• Definition Ticker Stock Explain A letter designation assigned to securities and mutual funds that trade on U.S. financial exchanges
• Definition Nyse Watcher Stock Explain and investigates trading activity on the NYSE in order to identify any unusual activity or security movement that might be caused by rumors
• Definition Books Stockholder Explain for its annual report that follows Financial Accounting Standards Board rules. The tax books follow IRS tax rules
• Definition Equity Stockholder Explain book value of ownership in the corporation. It includes capital stock, paid-in surplus, and retained earnings
• Definition Record Of Stockholder Explain Stockholder whose name is registered on the books of a corporation and thus will receive dividends from the corporation
• Definition Stockholder's equity Explain have against a firm's assets, calculated by subtracting all current liabilities and debt liabilities from total assets
• Definition Stockholder's report Explain The annual report and other reports given to stockholders to inform them of the company's financial standing and developments
• Definition Exchange Stock Stockholm Explain The only official equity trading market in Sweden
• Definition Stockout Explain Running out of inventory
• Definition Basis Stop Explain Method of entering an OTC trade into the trader's position without reporting the trade on the OTC tape
• Definition Order Limit Stop Explain limit. Unlike the stop order, which becomes a market order once the stop is reached, the stop-limit order becomes a limit order
• Definition Order Loss Stop Explain An order to sell a stock when the price falls to a specified level
• Definition Stop order (or stop) Explain when a definite price is reached, either above (on a buy) or below (on a sell) the price that prevailed when the order was given
• Definition Price Out Stop Explain The lowest auction price at which Treasury bills are sold
• Definition Payment Stop Explain An order given a depository institution not to pay out cash for a check; often used when the check has been stolen or lost
• Definition Stopped Explain customer's working order while the dealer tries to obtain a better one. Stopped against one's self involves a customer order and
• Definition Out Stopped Explain A purchase or sale that is executed under a stop order at the stop price specified by the customer
• Definition Curve Stopping Explain different times at which the expected value of refunding immediately equals the expected value of waiting to refund
• Definition Stopping curve refunding rate Explain A refunding rate that falls on the stopping curve
• Definition Bond Stock Story Explain A highly complex security that requires a long story so that investors may understand the corporation and be persuaded of its merits
• Definition Straddle Explain Purchase or sale of an equal number of puts and calls with the same terms at the same time. Related: Spread
• Definition Straight Explain Direct telephone line, compared to an outside line that requires a telephone number to be dialed
• Definition Depreciation Line Straight Explain Amortizing or apportioning an equal dollar amount of depreciation in each accounting period
• Definition Straight term insurance policy Explain Term life insurance policy providing a fixed-amount death benefit over a certain number of years
• Definition Value Straight Explain Also called investment value, the value of a convertible security without the conversion option
• Definition Voting Straight Explain Allows shareholder to cast all of the shareholder's votes for each candidate for the board of directors
• Definition Strangle Explain put option and call option on the same underlying instrument, with the same expiration. Profits are made only if there is a drastic change
• Definition Buyout Strategic Explain Acquisition of another firm in order to realize some operational benefits which will result in increased earnings
• Definition Indexing Equity Stratified Explain portfolio that classifies the stocks in the index into strata, and represents each stratum in the portfolio
• Definition Stratified sampling approach to indexing Explain Dividing an index into cells, each representing a different characteristic of the index, such as duration or maturity
• Definition Static theory of capital structure Explain Theory that the firm's capital structure is determined by a trade-off of the value of tax shields against the costs of bankruptcy
• Definition Error Tracking Statistical Explain Standard deviation of the difference between the portfolio return and the desired investment benchmark return
• Definition Investment Statutory Explain An investment that a trustee is authorized to make under state law
• Definition Merger Statutory Explain A merger in which one corporation remains as a legal entity, instead of a new legal entity being formed
• Definition Surplus Statutory Explain The surplus of an insurance company determined by the accounting treatment of both assets and liabilities as established by state statutes
• Definition Voting Statutory Explain The standard rule in most corporations that there is one vote per share in elections of the board of directors
• Definition Power Staying Explain The ability of an investor to stay in the market and not to sell out of a position when an investment has fallen in value
• Definition State Steady Explain months after component mortgages have passed at least once the threshold for refinancing, the prepayment speed tends to stabilize within a
• Definition Steepening of the yield curve Explain spread between the yield on a long-term and short-term Treasury has increased. Compare flattening of the yield curve and butterfly shift
• Definition Aside Step Explain Allow a block to trade at a price at which you do not care to participate in the trade
• Definition Note Down Step Explain A floating-rate note whose interest rate declines after a specified period of time
• Definition Up Step Explain To increase, as in step up the tax basis of an asset
• Definition Bond Up Step Explain for an initial period, and then increases to a higher coupon rate. Related: Deferred-interest bond, payment-in-kind bond
• Definition Intervention Sterilized Explain which monetary authorities insulate their domestic money supplies from the foreign exchange transactions with offsetting sales or purchases
• Definition Deal Sticky Explain A new securities issue that may be difficult to sell because of problems in the market or underlying problems with the corporation
• Definition Models Stochastic Explain Liability-matching models that assume that the liability payments and the asset cash flows are uncertain. Related: Deterministic models
• Definition Index Stochastics Explain A computerized tool measuring overbought and oversold conditions in a stock over a certain period
• Definition Stock Explain Ownership of a corporation indicated by shares, which represent a piece of the corporation's assets and earnings
• Definition Deduction Standard Explain The IRS-specified amount by which a taxpayer is entitled to reduce income an alternative to itemizing deductions
• Definition Deviation Standard Explain The square root of the variance. A measure of dispersion of a set of data from its mean
• Definition Ahead Stock Explain a certain price arrive about the same time, and the exchange's priority rules take effect. NYSE rules stipulate that the bid made
• Definition Plan Bonus Stock Explain A plan used as an incentive that rewards employee performance with stock in the company
• Definition Buyback Stock Explain A corporation's purchase of its own outstanding stock, usually in order to raise the company's earnings per share
• Definition Certificate Stock Explain A document representing the number of shares of a corporation owned by a shareholder
• Definition Dividend Stock Explain form of stock rather than cash. The stock dividend may be additional shares in the company, or it may be shares in a subsidiary being spun
• Definition Stock Exchange, Mumbai (BSE) Explain Formerly the Bombay stock exchange, the BSE accounts for more than one-third of Indian trading volume
• Definition Stock Exchange of Singapore (SES) Explain The only stock exchange in Singapore
• Definition Stock Exchange of Thailand (SET) Explain The only stock exchange in Thailand
• Definition Exchanges Stock Explain regulated by the Securities and Exchange Commission (SEC), that are made up of members who use the facilities to exchange certain common
• Definition Future Index Stock Explain indexes to allow investors to speculate on the performance of the entire market, or to hedge against losses in long or short positions. The
• Definition Option Index Stock Explain An option in which the underlying is a common stock index
• Definition Index Stock Explain Index like the Dow Jones Industrial Average that tracks a portfolio of stocks
• Definition Company Insurance Stock Explain An insurance company owned by a group of stockholders, who are not necessarily policyholders
• Definition Jockey Stock Explain A stock broker who frequently buys and sells shares in a client's portfolios
• Definition List Stock Explain The department within a stock exchange that oversees compliance with listing requirements and exchange regulations
• Definition Market Stock Explain Also called the equity market, the market for trading equities
• Definition Option Stock Explain An option whose underlying asset is the common stock of a corporation
• Definition Order Spread Explain that the customer wants to buy and sell and the desired spread between the premiums paid and received for the options
• Definition Position Spread Explain The status of an account after a spread order has been carried out
• Definition Strategy Spread Explain one or more options so that the cost of buying an option is funded entirely or in part by selling another option in the same underlying
• Definition Spreadsheet Explain A computer program that organizes numerical data into rows and columns in order to calculate and make adjustments based on new data
• Definition Ss1 Explain Securities sales speaker box that transmits to all investment banks' regional trading and sales desks
• Definition Trust Sprinkling Explain A trust in which the trustee decides how to distribute trust income among a group of designated people
• Definition Spx Explain Applies to derivative products. Symbol for the S;P 500 index
• Definition Squeeze Explain futures increase in price and investors who have sold short must cover their short positions to prevent loss of large amounts of money
• Definition Stabilization Explain buys and sells its own currency to protect its exchange value.Actions registered competitive traders undertake by on the NYSE to meet the
• Definition Stagflation Explain A period of slow economic growth and high unemployment with rising prices (inflation
• Definition Staggered board of directors Explain elected periodically, instead of all at once. Board terms are often staggered in order to thwart unfriendly takeover attempts, since
• Definition Maturities Staggering Explain Hedging against interest rate movements by investment in short-, medium-, and long-term bonds
• Definition Stagnation Explain A period of slow economic growth, or, in securities trading, a period of inactive trading
• Definition Stakeholders Explain financial or otherwise, in a firm-stockholders, creditors, bondholders, employees, customers, management, the community, and the government
• Definition Duty Stamp Explain equities. Taxes on foreign transactions, usually a percentage of total transaction amount, that can be unilateral or bilateral in nature
• Definition Principle Alone Stand Explain Investment approach that advocates a firm should accept or reject a project by comparing it with securities in the same risk class
• Definition To Up Stand Explain #039;s own bid and offering prices. Hence, standing up to the bid signifies the trader's willingness to buy size (i.e., 50m) volume at
• Definition Error Standard Explain In statistics, a measure of the possible error in an estimate. Plus or minus 2 standard errors usually provides a 95% confidence interval
• Definition Distribution Normal Standardized Explain A normal distribution with a mean of 0 and a standard deviation of 1
• Definition Agreement Standby Explain In a rights issue, agreement that the underwriter will purchase any stock not purchased by investors
• Definition Commitment Standby Explain investment firm that the firm will purchase whatever part of a stock issue that is offered in a rights offering that is not subscribed to
• Definition Fee Standby Explain Amount paid to an underwriter who agrees to purchase any stock that is not purchased by public investors in a rights offering
• Definition Agreement Standstill Explain Contract by which the bidding firm in a takeover attempt agrees to limit its holdings of another firm
• Definition Up Start Explain The earliest stage of a new business venture
• Definition Bank State Explain A bank authorized in a specific state by a state-based charter, with generally the same functions as a national bank
• Definition Price Conversion Stated Explain convertible security, the price the issuer effectively grants the securityholder to purchase the common stock, equal to the par value of
• Definition Maturity Stated Explain For the CMO tranche, the date the last payment would occur at zero CPR
• Definition Value Stated Explain relation to market value that is assigned, for accounting purposes, to stock for use instead of par value
• Definition Billing Statement Explain period such as a month (for which a customer also receives invoices) are collected into a single statement, and the customer must pay all
• Definition Statement-of-Cash-Flows Method Explain A method of cash budgeting that is organized along the lines of the statement of cash flows
• Definition Condition Of Statement Explain A document describing the status of assets, liabilities, and equity of a person or business at a particular time
• Definition Statement of Financial Accounting Standards No. 52 Explain currently used by U.S. firms. It mandates the use of the current rate method. See: Statement of Financial Accounting Standards No. 8
• Definition Statement of Financial Accounting Standards No. 8 Explain The is a currency translation standard once used by U.S. accounting firms. See: Statement of Accounting Standards No. 52
• Definition Spdrs Explain the value of the Standard ; Poor's 500 Composite Price Index. Stands for Standard ; Poor's Depositary Receipt. They trade on the
• Definition Spike Explain price, number of shares, type, and account of the order. Origin: Practice of placing the ticket on a metal spike upon execution or
• Definition Off Spin Explain company from an existing part of the company by selling or distributing new shares in the so-called spin-off
• Definition Spins Explain Stands for Standard ; Poor's 500 Index Subordinated Notes
• Definition Split Explain outstanding shares into more shares. If a company with 1 million shares executes a two-for-one split, the company would have 2 million
• Definition Commission Split Explain A commission shared between a broker and a financial adviser or other professional who brought the customer to the broker
• Definition Bond Coupon Split Explain A bond that begins as a zero-coupon bond paying no interest and converts to an interest paying bond on a future date
• Definition Option Fee Split Explain generally executes the split fee with first an initial fee, with a window period at the end of which (upon payment of a second fee) the
• Definition Offering Split Explain A municipal bond issue that is made up of serial bonds and term maturity bonds
• Definition Order Split Explain divided into smaller orders that are spread out over some period of time to avoid large fluctuations in the market price
• Definition Print Split Explain Block trade printed at two different prices. Often used in dividend rolls to get an average price equal to the dividend
• Definition Split-rate tax system Explain A tax system that taxes retained earnings at a higher rate than earnings that are distributed as dividends
• Definition Rating Split Explain Two different ratings given to the same security by two important rating agencies
• Definition Stock Split Explain others. (2) Division of the outstanding shares of a corporation into a large number of shares. Ordinarily, splits must be proposed by
• Definition For Spoken Explain Amount of opposite demand (placement) or supply (availability) the trader has in efforts to cross the stock. Not open
• Definition Sponsor Explain offers shares in its mutual funds, or an influential institution that highly values a particular security and thus creates additional
• Definition Commodity Spot Explain A commodity that is traded with the expectation of actual delivery, as opposed to a commodity future that is usually not delivered
• Definition Rates Exchange Spot Explain Exchange rate on currency for immediate delivery. Related: Forward exchange rate
• Definition Spot futures parity theorem Explain relationship between spot and futures prices. Violation of the parity relationship gives rise to arbitrage opportunities
• Definition Rate Interest Spot Explain Interest rate fixed today on a loan that is made today. Related: Forward interest rates
• Definition Lending Spot Explain Originating mortgages by processing applications taken directly from prospective borrowers
• Definition Markets Spot Explain Related: Cash markets
• Definition Month Spot Explain The nearest delivery month on a futures contract
• Definition Price Spot Explain physical commodity. Also called cash price. Current delivery price of a commodity traded in the spot market, in which goods are sold for
• Definition Curve Rate Spot Explain The graphical depiction of the relationship between the spot rates and maturity
• Definition Secondary Spot Explain require an SEC registration statement and may be attempted without delay. An underwriting discount is normally included in these offerings
• Definition Trade Spot Explain The purchase and sale of a foreign currency, commodity, or other item for immediate delivery
• Definition Ira Spousal Explain An individual retirement account in the name of an unemployed spouse
• Definition Trust Remainder Spousal Explain distributed to the beneficiary (such as a child of the grantor) to take advantage of a lower tax bracket, and that at the end of the term
• Definition Spread Explain of a stock or other security. (2) The simultaneous purchase and sale of separate futures or options contracts for the same commodity for
• Definition Income Spread Explain difference between income and cost. For a depository institution, the difference between the assets it invests in (loans and securities
• Definition Option Spread Explain of one option and the sale of another option on the same underlying security with a different exercise price and/or expiration date
• Definition Socially conscious mutual fund Explain companies that have interests in socially unacceptable markets or produce harmful products or by-products, such as high levels of
• Definition Rationing Capital Soft Explain Constraints on spending that under certain circumstances can be violated or even viewed as constituting targets rather than absolute limits
• Definition Currency Soft Explain A money of a country that is expected to drop in value relative to other currencies
• Definition Dollars Soft Explain brokerage houses supply to investment managers free of charge in exchange for the investment manager's business commissions
• Definition Landing Soft Explain enough to keep the economy out of recession, but also slow enough to prevent high inflation and interest rates
• Definition Market Soft Explain A buyer's market in which supply exceeds demand, causing little trading activity and wide bid-ask spreads
• Definition Spot Soft Explain Stocks or groups of stocks that remain weak in a strong market
• Definition Softs Explain Tropical commodities such as coffee, sugar, and cocoa
• Definition Away Sold Explain Refers to over-the-counter trading. Having sold stock to another dealer before making the present offering
• Definition Market Out Sold Explain Unavailability of a futures contract in a particular commodity or maturity date because of contract executions and limited offerings
• Definition Proprietorship Sole Explain A sole proprietor pays no corporate income tax but has unlimited liability for business debts and obligations
• Definition Solvency Explain Ability to meet obligations
• Definition Bond Sour Explain A bond issue that has defaulted on interest or principal payments, and will thus trade at a large discount and a poor credit rating
• Definition Source of funds seller Explain purpose of raising cash for other purchases. Such a seller will sell only at advantageous prices, and not aggressively
• Definition Statement of Cash Flows Explain A financial statement showing a firm's cash receipts and cash payments during a specified period
• Definition South African Futures Exchange (SAFEX) Explain Electronic futures and options exchange based in South Africa
• Definition Risk Sovereign Explain impose foreign exchange regulations that will reduce or negate the value of FX contracts. Also refers to the risk of government default on
• Definition Span Explain To cover all contingencies within a specified range
• Definition Account Arbitrage Special Explain A margin account with lower cash requirements, reserved for transactions that are hedged by an offsetting position in futures or options
• Definition Bond Assessment Special Explain A municipal bond with interest paid by the taxes of the community benefiting from the bond-funded project
• Definition Bid Special Explain stock on the NYSE by advertising a client's large buy order, and matching it up with a number of other traders' smaller sell
• Definition Account Bond Special Explain only for transactions in U.S. government bonds, municipals, and eligible listed and unlisted non-convertible corporate bonds
• Definition Dividend Special Explain Also referred to as an extra dividend. Dividend that is unlikely to be repeated
• Definition Specialist Explain designated as the market maker (or dealer for a listed common stock). Member of a stock exchange who maintains a fair and orderly market
• Definition Specialist block purchase and sale Explain Purchase of a large number of securities by a specialist for himself or to pass on to another floor trader or block buyer
• Definition Market Specialist Explain Market in a stock made solely by the specialist, as no public orders, and henceforth no depth, exist in the market
• Definition Unit Specialist Explain A specialist who maintains a stable market by acting as a principal and agent for other brokers in one or many stocks
• Definition Specialist's book Explain specialist that includes the specialist's own inventory of securities, market orders to sell short, and limit orders and stop orders
• Definition Specialist's short-sale ratio Explain The percentage of the total short sales of stock sold short by specialists
• Definition Market Issues Specific Explain The market in which dealers reverse in securities they wish to short
• Definition Spectail Explain A dealer doing business with retail but concentrating more on acquiring and financing its own speculative positions
• Definition Speculation Explain present the possibility of large profits, but also pose a higher-than-average possibility of loss. A profitable strategy over the long term
• Definition Speculative demand (for money) Explain The need for cash to take advantage of investment opportunities that may arise
• Definition Bond Grade Speculative Explain Bond rated BA or lower by Moody's, or BB or lower by S;P, or an unrated bond
• Definition Motive Speculative Explain A desire to hold cash in order to be poised to exploit any attractive investment opportunity requiring a cash expenditure that might arise
• Definition Speed Explain Related: Prepayment speed
• Definition Regression Linear Simple Explain A regression analysis between only two variables, one dependent and the other explanatory
• Definition Average Moving Simple Explain The mean, calculated at any time over a past period of fixed length
• Definition Prospect Simple Explain An investment opportunity in which only two outcomes are possible
• Definition Simple rate of return Explain dividing income plus capital gains by the amount of capital invested. The effect of compounding is not taken into account
• Definition Simplified Employee Pension (SEP) plan Explain employee and the employer contribute to an individual retirement account. Also available to the self-employed
• Definition Fund Country Single Explain A mutual fund that invests in individual countries outside the United States
• Definition Model Index Single Explain decomposes influences on returns into a systematic factor, as measured by the return on the broad market index, and firm specific factors
• Definition Option Single Explain A single put option or call option, as opposed to a spread or straddle, which involves multiple puts and calls
• Definition Bond Payment Single Explain A bond that makes only one payment of principal and interest
• Definition Single-Premium Deferred Annuity (SPDA) Explain investor makes a lump-sum payment that is invested in either a fixed-return instrument or a variable-return portfolio, which is taxed only
• Definition Single-premium life insurance Explain A whole life insurance policy requiring one premium payment, which accrues cash value much more quickly than a policy paid in installments
• Definition Single-state municipal bond fund Explain A mutual fund investing only in government obligations within a single state, with state tax-free dividends, but taxed capital gains
• Definition Sinker Explain A bond with interest and principal payments coming from the proceeds of a sinking fund
• Definition Fund Sinking Explain regular basis that is used to ensure investor confidence that promised payments will be made and that is used to redeem debt securities or
• Definition Requirement Fund Sinking Explain bond indentures that requires the issuer to retire a specified portion of debt each year. Any principal due at maturity is called the
• Definition Tight Sit Explain Directive from the trader to the customer to be patient, emphasizing that one's piece of business will be executed
• Definition Distribution Skewed Explain Probability distribution in which an unequal number of observations lie below (negative skew) or above (positive skew) the mean
• Definition Skewness Explain substantial probability of a big negative return. Positive skewness means that there is a greater-than-normal probability of a big positive
• Definition Settlement Day Skip Explain Settling a trade one business day beyond what is normal
• Definition Privilege Payment Skip Explain A mortgage contract clause giving borrowers the right to skip payments if they are ahead of schedule
• Definition Sale Last Sld Explain which shows up on the consolidated tape when a large change (one point for lower priced securities and two points for higher-priced
• Definition Sleeper Explain interest but that has significant potential to gain in price once its attractions are recognized. Antithesis of high flyer
• Definition Beauty Sleeping Explain takeover target that has not yet been approached by an acquirer. Such a company usually has particularly attractive features, such as a
• Definition Slippage Explain transactions costs and actual transactions costs. The difference usually represents revisions to price difference or spread and commission
• Definition Slump Explain A temporary fall in performance, often describing consistently falling security prices for several weeks or months
• Definition Cap Small Explain A stock with a small capitalization, meaning a total equity value of less than $500 million
• Definition Effect Firm Small Explain of total market capitalization) to outperform the stock market (consisting of both large and small firms
• Definition Investor Small Explain quantities of stock or bonds. This group of investors makes up a minimal fraction of total stock ownership
• Definition Exemption Issues Small Explain than $1.5 million are not required to file a registration statement with the SEC. Instead, they are governed by Regulation A, for which
• Definition Money Smart Explain Investors who make consistent profits in the market, regardless of the investing environment, by making wise, educated moves
• Definition Smidge Explain Small amount of price, usually +/- 1/8 or 1/4
• Definition Agreement Smithsonian Explain international monetary system that was signed at the Smithsonian Institution in Washington, D.C., in December 1971. Included were a new set
• Definition Snowballing Explain Process by which the exercise of stop orders in a declining or advancing market causes further downward or upward pressure on prices
• Definition Social Security Disability Income Insurance Explain tax to provide assistance to disabled individuals with disabilities expected to last at least one year, to compensate for lost income
• Definition Rule Sale Short Explain be made only in a market that is moving upward; this means either on an uptick from the last sale, or showing no downward movement
• Definition Selling Short Explain Establishing a market position by selling a security one does not own in anticipation of the price of that security falling
• Definition Settlement Short Explain Trade settlement made prior to the standard five-day period due to customer request
• Definition Test Short Short Explain to limit profits from short-term trading, which three months, to 30% of gross income. The penalty for exceeding this limit would be the
• Definition Squeeze Short Explain prices upward. In particular, when prices of a stock or commodity futures contracts start to move up sharply and many traders with short
• Definition Straddle Short Explain A straddle involves both purchase and sale. In short straddle one put and one call are sold
• Definition Tender Short Explain Practice prohibited by SEC that involves the use of borrowed stock to respond to a tender offer
• Definition Term Short Explain Any investments with a maturity of one year or less
• Definition Short-term bond fund Explain A bond mutual fund holding short to intermediate-term bonds that have maturities of three to five years
• Definition Debt Term Short Explain Debt obligations, recorded as current liabilities, requiring payment within the year
• Definition Short-term financial plan Explain A financial plan that covers the coming fiscal year
• Definition Short-term gain (or loss) Explain of securities held for less than a year that is taxed at normal income tax rates if the net total is positive
• Definition Short-term investment services Explain Services that assist firms in making short-term investments
• Definition Short-term solvency ratios Explain liquid assets for meeting short-term obligations as they come due, including (1) the current ratio, (2) the acid test ratio, (3) the
• Definition Short-term tax exempts Explain Short-term securities issued by states, municipalities, and quesi-government entities such as local housing and urban renewal agencies
• Definition Cost Shortage Explain Costs that fall with increases in the level of investment in current assets
• Definition Risk Shortfall Explain The risk of falling short of any investment target
• Definition Stopper Show Explain A legal barrier, such as a scorched-earth policy or shark repellant system, that firms use to prevent a takeover
• Definition Show and tell list Explain Used in the context of general equities. Block list which is full of real customer indications (rather than profile
• Definition Shrinkage Explain Discrepancy between a firm's actual inventory and its recorded inventory due to theft, deterioration, loss, or clerical problems
• Definition Shut out the book Explain Used for listed equity securities. Exclude a public bid or offer from participation in a print
• Definition Side-by-side trading Explain Trading a security and an option on the same security on the same exchange
• Definition Sidelines Explain Hypothetical position referring to noninvolvement in a stock; merely watching
• Definition Draft Sight Explain Demand for immediate payment
• Definition Signal Explain 039;s actions. The more costly it is to provide a signal, the more credibility it has. For example, to call a press conference and tell
• Definition Approach Signaling Explain information that the market does not have, and that the choice of capital structure by insiders can signal information to outsiders and
• Definition Signaling approach (on dividend policy) Explain The argument that dividend changes are important signals to investors about changes in management's expectation about future earnings
• Definition Loan Signature Explain A good faith loan that is unsecured and requires only the borrower's signature on the loan application
• Definition Influence Significant Explain equity of a corporation, usually at least 20%, which gives the holder a significant amount of control over the corporation. This degree of
• Definition Order Significant Explain quantity of securities that the price of the security may be affected. Institutional investors usually spread out such an order over a few
• Definition Imbalance Order Significant Explain for a stock that cause an abnormally wide spread between bid and offer prices, and often causes the exchange to halt the sale of the stock
• Definition Partner Silent Explain A partner in a business who has no role in management but shares in the liability, tax responsibility, and cash flow
• Definition Simple compound growth method Explain terminal value to initial value and assuming a constant percentage annual rate of growth between the two values
• Definition Interest Simple Explain Interest calculated as a simple percentage of the original principal amount. Compare to compound interest
• Definition Ira Simple Explain A salary deduction plan for retirement benefits provided by some small companies with no more than 100 employees
• Definition Letter 039 Shareholders Explain can find general overall discussion by management of successful and failed strategies. Provides guidance for looking at specific parts of
• Definition Shares Explain Certificates or book entries representing ownership in a corporation or similar entity
• Definition Standing Explain Level of priority in the trading crowd
• Definition Repellant Shark Explain are golden parachutes, poison pills, safe harbor, and scorched-earth policy. Porcupine provision. Amendment to company charter intended to
• Definition Watcher Shark Explain specializing in the early detection of takeover activity. Such a firm, whose primary business is usually the solicitation of proxies for
• Definition Benchmark Sharpe Explain adjusts for a manager's index-like tendencies. Named after William Sharpe, Nobel Laureate, and developer of the capital asset pricing
• Definition Ratio Sharpe Explain return relative to the total variability of the portfolio. Related: Treynor index. Named after William Sharpe, Nobel Laureate, and
• Definition Value Standardized Explain Also called the normal deviate, the distance of one data point from the mean, divided by the standard deviation of the distribution
• Definition Registration Shelf Explain one registration statement covering several issues of the same security. SEC Rule 415, adopted in the 1980s, allows a corporation to comply
• Definition Corporation Shell Explain significant assets or operations, often formed to obtain financing before beginning actual business, or as a front tax evasion
• Definition Shirking Explain return is smaller. Owners may have more incentive to shirk if they issue equity as opposed to debt, because they retain less ownership
• Definition Simple linear trend model Explain An extrapolative statistical model that asserts that earnings have a base level and grow at a constant amount each period
• Definition Bond Shogun Explain Dollar bond issued in Japan by a nonresident
• Definition Shootout Explain Venture capital jargon. Refers to two or more venture capital firms fighting for the startup
• Definition Shop Explain Wall Street slang for a firm
• Definition Stock Shopped Explain Sell inquiry that has been seen by or shown to other dealers before coming to an investment bank
• Definition Shopping Explain Seeking to obtain the best bid or offer available by calling a number of dealers and/or brokers
• Definition Short Explain establish a market position and who has not yet closed out this position through an offsetting purchase; the opposite of a long position
• Definition Bonds Short Explain Bonds with short (not much time to maturity) current maturities
• Definition Coupon Short Explain months' interest, because the original issue date is less than six months from the first scheduled interest payment. A bond with a
• Definition Calendar Shadow Explain A backlog of securities issues registered with the SEC, awaiting the determination of an offer date
• Definition Exempt Short Explain special trading situation where a short sale is allowed on a minustick. The owners of a convertible trading at parity can sell the
• Definition Hedge Short Explain eliminate or lessen the possible decline in value of an approximately equal amount of the actual financial instrument or physical commodity
• Definition Interest Short Explain that investors have sold short and that have not been repurchased to close out the short position. Usually, investors sell short to profit
• Definition Theory Interest Short Explain short positions in stocks will precede a rise in the market prices, because the short positions must eventually be covered by purchases of
• Definition Position Short Explain she does not yet own. Shares must be borrowed, before the sale, to make good delivery to the buyer. Eventually, the shares must be bought
• Definition Short ratio(or short interest ratio) Explain investors have sold short divided by average daily volume of the security (measured over 30 days or 90 days). There are various
• Definition Short-run operating activities Explain short-term finance of a firm, such as how much inventory to order and whether to offer cash terms or credit terms to customers
• Definition Sale Short Explain not own but is committed to repurchasing eventually. It is used to capitalize on an expected decline in the security's price
• Definition Market Sensitive Explain A market that reacts to a great extent to good or bad news
• Definition Analysis Sensitivity Explain Analysis of the effect on a project's profitability of changes in sales, cost, and so on
• Definition Indicators Sentiment Explain The general feeling of investors about the state of the market, such as whether they are bullish or bearish
• Definition Customer Separate Explain Securities Investor Protection Corporation. Each account that is under the name of a different person or group of people is entitled to
• Definition Returns Tax Separate Explain choose to file their returns individually, usually because this approach produces lower overall tax payments
• Definition Property Separation Explain be divided into two independent tasks: (1) Determination of the optimal risky portfolio, which is a purely mathematical problem, and (2
• Definition Theorem Separation Explain to an individual is not dependent on consumption preferences. That is, investors will want to accept or reject the same investment projects
• Definition Covariance Serial Explain The covariance between a variable and the lagged value of the variable; the same as autocorrelation
• Definition Entrepreneur Serial Explain Business person that successfully starts (does not kill) a number of different businesses
• Definition Redemption Serial Explain The redemption of a serial bond
• Definition Series Explain same class that also have the same unit of trade, expiration date, and exercise price. Stocks: shares that have common characteristics
• Definition Bond Series Explain Bond that may be issued in several series under the same indenture document
• Definition Bond E Series Explain A local and state tax-free bond issued by the U.S. government from 1941 to 1979, which was then replaced by Series HH bonds
• Definition Aside Set Explain A percentage of a municipal or corporate bond underwriting that is allocated for handling by a minority-owned broker/dealer firm
• Definition Set of contracts perspective Explain contracting relationships among individuals who have conflicting objectives, such as shareholders or managers. The corporation is a legal
• Definition Up Set Explain securities. Arbitrage involving going long the convertible and short a certain percentage of the underlying common. Antithesis of Chinese
• Definition Settlement Explain When payment is made for a trade
• Definition Date Settlement Explain settle a trade. For stocks traded on U.S. exchanges, settlement is currently three business days after the trade. For mutual funds
• Definition Options Settlement Explain The various possibilities open to a beneficiary under a life insurance policy as to how the benefit will be paid out
• Definition Price Settlement Explain range that is used to calculate gains and losses in futures market accounts. Settlement prices are used to determine gains, losses, margin
• Definition Rate Settlement Explain Accounting Standards Board (FASB) 87 for discounting the obligations of a pension plan. The rate at which the pension benefits could be
• Definition Risk Settlement Explain The risk that one party will deliver and the counterparty will not be able to pay and vice versa
• Definition Stock Shadow Explain stock that strips out the market wide movements for the purpose of rewarding managers. That is, the management might have done a great job
• Definition Shakeout Explain A dramatic change in market conditions that forces speculators to sell their positions, often at a loss
• Definition Sham Explain A business transaction, such as a limited partnership, that is entered into for the sake of avoiding tax
• Definition Broker Share Explain traded, and reduces the per unit charge as the number of shares traded increases, as opposed to a dealer who charges a percentage of the
• Definition Repurchase Share Explain back its own shares in the open market. It is usually done when shares are undervalued. Since repurchase reduces the number of shares
• Definition Shared Appreciation Mortgage (SAM) Explain A mortgage with a low rate of interest, offset by giving the lender some portion of the appreciation in the value of the underlying property
• Definition Shareholder Explain Person or entity that owns shares or equity in a corporation
• Definition Equity 039 Shareholders Explain This is a company's total assets minus total liabilities. A company's net worth is the same thing
• Definition Loan Liquidating Self Explain Loan to finance current assets. The sale of the current assets provides the cash to repay the loan
• Definition Self-regulatory organization (SRO) Explain ethical, and efficient practices in the securities and commodity futures industries, including all national securities and commodities
• Definition Selection Self Explain Consequence of a contract that induces only one group to participate
• Definition Size Explain an order, or a trade. Large as in the size of an offering, the size of an order, or the size of a trade. Size is relative from market to
• Definition Book The Sell Explain Order to a broker by the holder of a large quantity of shares of a security to sell all that can be absorbed at the current bid price. The
• Definition Hedge Sell Explain Related: short hedge
• Definition Order Limit Sell Explain Conditional trading order that indicates that a security may be sold at the designated price or higher. Related: Buy limit order
• Definition Rate Spot Explain The theoretical yield on a zero-coupon Treasury security
• Definition Order Sell Explain forms by an investor to a broker to sell a particular stock, bond, option, future, mutual fund, or other holding
• Definition Out Sell Explain customer has failed to bring an account to a required level by producing additional equity after a margin call.The selling of securities
• Definition Order Plus Sell Explain amount of stock provided that the price to be obtained is not lower than the last sale if the last sale was a plus, or zero plus tick, and
• Definition Analyst Side Sell Explain brokerage firm and whose recommendations are passed on to the brokerage firm's customers. Also called a Wall Street analyst
• Definition Financing Seller Explain Funding a purchase by a seller's loan to the buyer, the buyer takes full title to the property when the loan is fully repaid
• Definition Seller's market Explain Market in which demand exceeds supply. As a result, the seller can dictate the price and the terms of sale
• Definition Seller's option Explain Delayed settlement/delivery in a transaction
• Definition Climax Selling Explain A sudden drop in security prices as sellers dump their holdings
• Definition Concession Selling Explain The discount underwriters offer the selling group on securities in a new issue
• Definition Dividends Selling Explain Inducing a prospective customer to buy shares in order to profit from a dividend scheduled in the near future
• Definition Selling, general, and administrative (SG;A) expenses Explain salaries and commissions, advertising and promotion, travel and entertainment, office payroll and expenses, and executives' salaries
• Definition Selling on the good news Explain after a company announces good news and the stock price rises. Investors believe that the price is as high as it can go and is on the brink
• Definition Group Selling Explain All banks involved in selling or marketing a new issue of stock or bonds
• Definition Short Selling Explain an investor thinks the price of a stock is going down, the investor could borrow the stock from a broker and sell it. Eventually, the
• Definition Securities Of Segregation Explain SEC rules to dictate how customers' securities may be used by broker-dealers in broker loans
• Definition Selling short against the box Explain owned by the seller but held in the box, meaning it is held in safekeeping. The seller borrows securities needed to cover as the stock in
• Definition Spread The Selling Explain A spread whose option to be sold is trading at a higher premium than the option to be bought
• Definition Efficiency Form Semistrong Explain profits the price of a security fully reflects all public information (including, but not limited to, historical price and trading patterns
• Definition In It Send Explain Market language: I bought your stock - 'send it in' (and possibly more
• Definition Debt Senior Explain Debt whose terms in the event of bankruptcy, require it to be repaid before subordinated debt receives any payment
• Definition Bond Mortgage Senior Explain A bond that, in the event of bankruptcy, will be redeemed before any other bonds are repaid
• Definition Refunding Senior Explain with 5-to 12-year maturities with securities of 15-year or longer maturities, in order to delay, reduce, or consolidate payment
• Definition Security Senior Explain A security that, in the event of bankruptcy, will be redeemed before any other securities
• Definition Seniority Explain The order of repayment. In the event of bankruptcy, senior debt must be repaid before subordinated debt is repaid
• Definition Stocks Secondary Explain capitalization, less quality and more risk than blue chip issues that behave differently than larger corporations' stocks
• Definition Lending Mortgage Second Explain Loans secured by real estate previously pledged in a first mortgage
• Definition 482 Section Explain U.S. Department of Treasury regulations governing transfer prices
• Definition Sector Explain Used to characterize a group of securities that are similar with respect to maturity, type, rating, industry, and/or coupon
• Definition Rotation Sector Explain certain sectors, that tactically overweights and underweights depending on expected performance. Sometimes called rotation
• Definition Secular Explain Long-term time frame (10-50 years or more
• Definition Bond Secured Explain A bond backed by the pledge of collateral, a mortgage, or other lien, as opposed to an unsecured bond, called a debenture
• Definition Debt Secured Explain Debt that has first claim on specified assets in the event of default
• Definition Securities Act of 1933 Explain First law designed to regulate securities markets, requiring registration of securities and disclosure
• Definition Securities Acts Amendments of 1975 Explain establishment of a national market system together with a system for nationwide clearing and settlement of securities transactions
• Definition Analysts Securities Explain Related: Financial analysts
• Definition Securities and commodities exchanges Explain Exchanges on which securities, options, and futures contracts are traded by members for their own accounts and for the accounts of customers
• Definition Securities and Exchange Commission Rules Explain Rules enacted by the SEC to assist in the regulation of U.S. financial markets
• Definition Securities Exchange Act of 1934 Explain Legislation that created the SEC, outlawing dishonest practices in the trading of securities
• Definition Securities Exchange of Thailand (SET) Explain The only stock market in Thailand, based in Bangkok
• Definition Securities Industry Association (SIA) Explain sell taxable securities, which lobbies the government, records industry trends, and keeps records of broker profits
• Definition Securities Industry Committee on Arbitration (SICA) Explain A private group that provides mediation services in case of customer complaints against securities firms
• Definition Securities Investor Protection Corporation (SIPC) Explain A nonprofit corporation that insures customers' securities and cash held by member brokerage firms against the failure of those firms
• Definition Loan Securities Explain The loan of securities between brokers, often to cover a client's short sale; or a loan secured by marketable securities
• Definition Markets Securities Explain Organized exchanges plus over-the-counter markets in which securities are traded
• Definition Securitization Explain investment instrument such as the mortgage pass-through security, by pooling assets to back the instrument. Also refers to the replacement
• Definition Security Explain Piece of paper that proves ownership of stocks, bonds, and other investments
• Definition Line Characteristic Security Explain on a security over the risk-free rate as a function of the excess return on the market. The slope of this line is the security's beta
• Definition Initial Deposit Security Explain amount that must be deposited with the broker for each contract as a guarantee of fulfillment of the futures contract. It is not
• Definition Maintenance Deposit Security Explain Related: Maintenance margin
• Definition Line Market Security Explain Line representing the relationship between expected return and market risk or beta. The slope of this line is the risk premium for beta
• Definition Plane Market Security Explain A plane that shows the relationship between expected return and the beta coefficient of more than one factor
• Definition Ratings Security Explain Commercial rating agencies' assessment of the credit and investment risk of securities
• Definition Decision Selection Security Explain Choosing the particular stocks or bonds or other investment instruments to include in a portfolio
• Definition Severally but not jointly Explain underwriting group buy a new issue (severally), but not to assume joint liability for shares left unsold by other members
• Definition Market A Seek Explain Search for a securities buyer or seller
• Definition Portfolio Ten Select Explain A unit investment trust that buys and holds for one year the ten stocks in the Dow Jones Industrial Average with the highest dividend yields
• Definition Agreement Dealer Selected Explain The set of rules governing the selling group in an underwriting
• Definition Mortgage Amortizing Self Explain Mortgage whose entire principal is paid off in a specified period of time with regular interest and principal payments
• Definition Ira Directed Self Explain An IRA that the account holder can after appointing a custodian manager to carry out investment instructions
• Definition Income Employed Self Explain Taxable income of a person involved in a sole proprietorship or other sort of free-lance work
• Definition Tax Employment Self Explain A tax self-employed people must pay to qualify them to receive Social Security benefits at retirement
• Definition Element Savings Explain the cash value built up in a policy, which equals the amount of premium paid minus the cost of protection. This excess is invested by the
• Definition Savings and loan association Explain National- or state-chartered institution that accepts savings deposits and invests the bulk of the funds thus received in mortgages
• Definition Rate Savings Explain Personal savings as a percentage of disposable personal income
• Definition Scale Explain on CDs of varying maturities. A bank is said to post a scale. Commercial paper dealers also post scales
• Definition Enhancing Scale Explain risk class as the whole firm. That is, the project allows the firm to grow larger in the context of their current business rather than
• Definition In Scale Explain Gradually taking a position in a security or market over time
• Definition Order Scale Explain specifies the total amount to be bought (sold) and the amount to be bought (sold) at successively decreasing (increasing) price intervals
• Definition Scalp Explain To trade for small gains. Scalping normally involves establishing and liquidating a position quickly, usually within the same day
• Definition Scattered Explain Used for listed equity securities. Unconcentrated buy or sell interest
• Definition Analysis Scenario Explain The use of horizon analysis to project total returns under different reinvestment rates and future market yields
• Definition C Schedule Explain Describes membership requirements and procedures of NASD, in its bylaws
• Definition 13D Schedule Explain Disclosure form required when more than 5% of any class of equity securities in a publicly held corporation is purchased
• Definition Flows Cash Scheduled Explain The mortgage principal and interest payments due to be paid under the terms of the mortgage, not including possible prepayments
• Definition Policy Earth Scorched Explain technique a company that has become the target of a takeover attempt uses to make itself unattractive to the acquirer. For example, it may
• Definition Score Explain Equity, a certificate that entitles the owner to the capital appreciation of an underlying security, but not to the dividend income from
• Definition Stocks Screen Explain stocks that meet predetermined criteria. For example, a simple value screen would sort all stocks by their price-to-book ratio and pick the
• Definition Scrip Explain A temporary document that represents a portion of a share of stock, often issued after a stock split or spin-off
• Definition Scripophily Explain Collecting stock and bond certificates for their scarcity, rather than for their value as securities
• Definition Costs Search Explain counterparty to a trade, including explicit costs (such as advertising) and implicit costs (such as the value of time). Related
• Definition Adjusted Seasonally Explain macroeconomic indicator (e.g., oil prices/imports) so that relative comparisons can be drawn from month to month all year
• Definition Seasoned Explain reputation for quality with the investing public and enjoying liquidity in the secondary market; in the case of convertibles, having traded
• Definition Datings Seasoned Explain Extended credit for customers who order goods in periods other than peak seasons
• Definition Issue Seasoned Explain Issue of a security for which there is an existing market. Related: Unseasoned issue
• Definition Issue New Seasoned Explain #039;s securities have previously been issued. A seasoned new issue of common stock can be made using a cash offer or a rights offer
• Definition Seat Explain Position of membership on a securities or commodity exchange, bought and sold at market prices
• Definition Fee Sec Explain Small fee the SEC charges to sellers of equity securities on an exchange
• Definition Regression Pass Second Explain portfolio returns on betas. The estimated slope is the measurement of the reward for bearing systematic risk during the period analyzed
• Definition Stock Preferred Second Explain Preferred stock issue that has less priority in claiming dividends and assets in liquidation than another issue of preferred stock
• Definition Round Second Explain Stage of venture capital financing following the start-up and first round stages and before the mezzanine level stage
• Definition Second-to-die insurance Explain Insurance policy that, on the death of the spouse dying last, pays a death benefit to the heirs that is designed to cover estate taxes
• Definition Offering Distribution Secondary Explain securities held by large investors, usually corporations or institutions, as distinguished from a primary distribution, where the seller is
• Definition Issue Secondary Explain 1) Procedure for selling blocks of seasoned issues of stocks. (2) More generally, sale of already issued stock
• Definition Market Secondary Explain traded after they are initially offered in the primary market. Most trading occurs in the secondary market. The New York Stock Exchange, as
• Definition Market Mortgage Secondary Explain Buying and selling existing mortgage loans, which are often pooled and traded as mortgage-backed securities
• Definition Stripped mortgage-backed securities (SMBS) Explain flows from the underlying generic MBS collateral into the principal and interest components of the MBS to enhance their attaractiveness to
• Definition Small Order Execution System (SOES) Explain Three-tiered system of automatic execution of an order at the best price. Size is either 200, 500, or, most often, 1000 shares
• Definition Society for Worldwide Interbank Financial Telecommunications (SWIFT) Explain A dedicated computer network to support funds transfer messages internationally between over 900 member banks world-wide
• Definition Harbor Safe Explain of shark repellent. A target company acquires a business so onerously regulated that it makes the target less attractive, giving it, in
• Definition Lease Harbor Safe Explain ownership (depreciation and debt tax shield) from the lessee, if the lessee could not use them, to a lessor that could use them
• Definition Safekeep Explain Holding by a bank of bonds and money market instruments. For a fee, the bank clips coupons and presents for payment at maturity
• Definition Cushion Safety Explain In a contingent immunization strategy, the difference between the initially available immunization level and the safety-net return
• Definition Return Net Safety Explain The minimum available return that will trigger an immunization strategy in a contingent immunization strategy
• Definition Salary Explain Regular wages and benefits an employee receives from an employer
• Definition Freeze Salary Explain A temporary halt to increases in salary due to financial difficulties experienced by a company
• Definition Plan Reduction Salary Explain A plan allowing employees to contribute pre-tax income to a tax-deferred retirement plan
• Definition Sale Explain An agreement between a buyer and a seller on the price to be paid for a security, followed by delivery
• Definition Sale and lease-back Explain Sale of an existing asset to a financial institution that then leases it back to the user. Related: Lease
• Definition Charge Sales Explain purchase of shares, usually payable as a commission to a marketing agent, such as a financial adviser, who is thus compensated for
• Definition Forecast Sales Explain planning process. External sales forecasts are based on historical experience, statistical analysis, and consideration of various
• Definition Literature Sales Explain Material written by an institution selling a product, which informs potential buyers of the product and its benefits
• Definition Tax Sales Explain A percentage tax on the selling price of goods and services
• Definition Lease Type Sales Explain equipment, such as a printing company leasing its own presses, thereby competing with an independent leasing company
• Definition Student Loan Marketing Association (SLMA) Explain established by federal action that increases availability of educational loans by guaranteeing student loans traded in the secondary market
• Definition Salomon Brothers World Equity Index (SBWEI) Explain weighted index used to measure the performance of fixed-income and equity markets. It includes approximately 6000 companies in 22 countries
• Definition Value Salvage Explain Scrap value of plant and equipment
• Definition Same-Day Funds Settlement (SDFS) Explain between well-collateralized parties in good-the-same-day federal funds used by the Depository Trust Company for transactions in U.S
• Definition Substitution Day Same Explain Offsetting changes in a margin account during the day that result in no overall change in the balance of the account
• Definition Bond Samurai Explain A yen-denominated bond issued in Tokyo by a non-Japanese borrower. Related: Bulldog bond and Yankee bond
• Definition Market Samurai Explain The foreign market in Japan
• Definition Rally Claus Santa Explain Seasonal rise in stock prices in the last week of the calendar year, between Christmas and New Year's Day
• Definition Covering Short Explain Actual purchase of securities by a short seller to replace those borrowed at the time of a short sale
• Definition P S Explain Standard ; Poor's Corporation
• Definition S;P 500 Composite Index Explain Index of 500 widely held common stocks that measures the general performance of the market
• Definition Phenomenon P S Explain P composite index to rise in price due to a large number of buy orders as S;P-related index funds add the stock to their portfolios
• Definition Rating P S Explain Rating service provided by S;P that indicates the amount of risk involved with different securities
• Definition Special Night Saturday Explain Often used in risk arbitrage. Sudden attempt by one company to take over another by making a public tender offer
• Definition Saucer Explain Technical chart pattern depicting a security whose price has reached bottom and is moving up
• Definition Bank Savings Explain An institution that primarily accepts consumer savings deposits and to make home mortgage loans
• Definition Bond Savings Explain denominations from $50 to $10,000, with local and state tax-free interest and semiannually adjusted interest rates
• Definition Deposits Savings Explain at below-market interest rates, that do not have a specific maturity, and that usually can be withdrawn upon demand
• Definition S Explain Fifth letter of a Nasdaq stock symbol specifying a beneficial interest
• Definition Savings Association Insurance Fund (SAIF) Explain the Federal Savings and Loan Insurance Corporation as the provider of deposit insurance for thrift institutions
• Definition Special Drawing Rights (SDR) Explain A form of international reserve assets, created by the IMF in 1967, whose value is based on a portfolio of widely used currencies
• Definition Stock Exchange Automated Quotation System (SEAQ) Explain London's Nasdaq system
• Definition Securities ; Exchange Commission (SEC) Explain financial markets. The SEC also oversees the securities industry and promotes full disclosure in order to protect the investing public
• Definition Stock Exchange of Hong Kong (SEHK) Explain Only stock exchange located in Hong Kong
• Definition Security Industry Automated Corporation (SIAC Explain Entity that executes automated DOT orders
• Definition Standard Industrial Classification (SIC) Explain A code system that designates a unique business activity classified by industry
• Definition Singapore International Monetary Exchange (SIMEX) Explain A leading futures and options exchange in Singapore

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Singapore International Monetary Exchange (Simex), Standard Industrial Classification (Sic), Security Industry Automated Corporation (Siac, Stock Exchange Of

Singapore International Monetary Exchange (Simex), Standard