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Economy 2 Markers for G.

S Mains Paper 2
They generally ask ( 2 Mark X 15 Question) = 30 M question from this
each year.

This E-book contains 230 Terms!

Amounts owing on open account to creditors for goods and services.


Accounts Payable Accounts Receivable Money owed to a business for merchandise or
services sold on open account.
Accounting method whereby income and expense items are
Accrual Basis recognized as they are earned or incurred, even though they may not
have been received or actually paid in cash.
Bonds that do not make periodic interest payments, but instead
Accrual Bonds accrue interest until the bond matures. Also known as zero-coupon
bonds.
Interest that has accumulated between the most recent payment and
the sale of a security, i.e. deemed to be earned on a security but not
Accrued Interest
yet paid to the investor. At the time of the sale, the buyer pays the
seller the security's price plus accrued interest
Acquisition One company taking over controlling interest in another company.
Adjusted EPS Adjusted Earnings per share
AFM Amman Financial Market
After-tax Return An investment's return after all income taxes have been deducted.
Acronym for Arabian General Investment Corporation. The company
AGICO
has changed its name to SHUAA Capital psc in April 2001.
Measure of risk-adjusted performance. An alpha is usually generated
Alpha by regressing the security or mutual fund's excess return on
benchmark index's excess return.
Receipt for the shares of a foreign-based corporation held in the vault
American Depository
of a U.S. bank and entitling the shareholder to all dividends and capital
Receipt (ADR)
gains.
Accounting procedure that gradually reduces the cost value of a
limited life or intangible asset, such as goodwill, through periodic
Amortization
charges to income. Amortization also refers to the reduction of debt
by regular-payments of interest and principal suffici
Annual Meeting Once-a-year meeting when the managers of a company report to
stockholders on the year's results, and the board of directors stands
for election for the next year.
Yearly record of a corporation's financial condition that must be
distributed to shareholders. Included in the report is a escription of
Annual Report
the company's operations as well as its balance sheet and income
statement.
A long-term investment that provides tax-deferred growth and income
Annuity
at regular intervals for as long as you specify.
Profiting from differences in price when the same security, currency,
Arbitrage
or commodity is traded on two or more markets.
The price at which a market maker is willing to sell a specified quantity
Ask Price
of a particular security.
Anything having commercial or exchange value that is owned by a
Asset
business, institution, or individual.
Apportioning of investment funds among categories of assets, such as
cash equivalents, stocks, fixed-income investments, and such tangible
Asset Allocation
assets as real estate, precious metals, and collectibles. Asset allocation
affects both risk and return and is a cen
Assets Under
The value of the assets that a company manages, but does not own.
Management
Maximum number of shares of any class a company may legally create
under the terms of its articles of incorporation. Normally, a
Authorized Shares
corporation provides for future increases in authorized stock by vote
of the stockholders. The corporation is not required to
Open account balance or loan receivable that has proven uncollectible
Bad Debt
and is written off.
System of recording all of a country's economic transactions with the
Balance of Payments
rest of the world during a particular time period.
Net difference over a period of time between the value of a country's
Balance of Trade
imports and exports of merchandise.
Financial report showing the status of a company's assets, liabilities,
Balance Sheet
and owners' equity on a given day.
A fund that invests in both stocks and bonds whose objective is both
Balanced Fund
growth and income.
One one-hundredth of 1 percent. Yield differences among fixed-
Basis point
income securities are stated in basis points
Bear Market Prolonged period of falling prices.
A security that has no identification as to owner. It is presumed to be
owned by the person who holds it. Bearer securities are freely
Bearer security
negotiable, since ownership can be quickly transferred from seller to
buyer by delivery of the instrument. However, note
Coefficient measuring a stock's relative volatility. The beta is the
Beta
covariance of a stock in relation to the rest of the stock market.
measure of the relative volatility of a stock or other security as
compared to the volatility of the entire market (usually measured for a
Beta
benchmark index). A beta above 1.0 shows greater volatility than the
overall market, while betas below 1.0 are less v
Bid The price at which a buyer will purchase a security.
The price at which a market-maker is willing to purchase a specified
Bid Price
quantity of a particular security.
Common stock of a nationally known company that has a long record
Blue Chip of profit growth and dividend payment and a reputation for quality
management, products, and services.
Group of individuals elected, usually at an annual meeting, by the
Board of Directors shareholders of a corporation and empowered to carry out certain
tasks as spelled out in the corporation's charter.
Any interest-bearing or discounted government or corporate security
that obligates the issuer to pay the bondholder a specified sum of
Bond
money, usually at specific intervals, and to repay the principal amount
of the loan at maturity.
A partial list of bond insurers includes American Municipal Bond
Bond insurers and Assurance Corp. (AMBAC), ACA Financial Guaranty, Asset Guaranty
reinsurers Insurance Co., AXA Re Finance, Capital Guaranty Insurance Co., Capital
Markets Assurance Corp. (CapMAC), Capital Reinsurance Co
An indicator of the creditworthiness of specific bond issues. These
ratings are often interpreted as an indication of the likelihood of
Bond Ratings
default on the part of the respective bond issuers. Bonds with the
smallest default probability are rated AAA (or Aaa)
Also known as a capitalization or scrip issue. This is when a company
issues free shares to a company's existing shareholders. No money
Bonus Issue
changes hands and the share price falls pro rata. This is usually used as
an exercise to make the shares more marketabl
A method of recording and transferring ownership of securities
Book-entry
electronically, eliminating the need for physical certificates.
An investment strategy that focuses on individual stocks, rather than
Bottom-Up Approach general market trends. It assumes strong companies can perform well
independent of the market environment.
Person who acts as an intermediary between a buyer and seller,
Broker
usually charging a commission.
BSE Bahrain Stock Exchange
Budget Estimate of revenue and expenditure for a specified period.
Excess of spending over income for a government, corporation, or
Budget Deficit
individual over a particular period of time.
Excess of income over spending for a government, corporation, or
Budget Surplus
individual over a particular period of time.
BVPS Book Value per share
Right to buy shares of a particular stock or stock index at a
Call Option
predetermined price before a preset data, in exchange for a premium.
A dollar amount, usually stated as a percent of the principal amount
Call premium called, paid by the issuer as a "penalty" for the exercise of
a call provision.
Bonds which are redeemable by the issuer prior to the maturity date
Callable bonds
at a specified price at or above par.
Cap The top interest rate that can be paid on a floating-rate security.
Long-term asset that is not bought or sold in the normal course of
Capital Asset
business.
Difference between an asset's purchase price and selling price, when
Capital Gain
the difference is positive.
Capital Markets Markets where capital funds - debt and equity - are traded.
Stock authorized by a company's charter. The number and value of
Capital Stock issued shares are normally shown, together with the number of shares
authorized, in the capital accounts section of the balance sheet.
Rate of interest used to convert a series of future payments into a
Capitalization Rate
single present value.
A business that generates a continuing flow of cash. Such a business
usually has well-established brand names whose familiarity stimulates
Cash Cow
repeated buying of the products. Stocks that are cash cows have
dependable dividends.
Cash payment to a corporation's shareholders, distributed from
Cash Dividend
current earnings or accumulated profits.
Instruments or investments of such high liquidity and safety that they
Cash Equivalents are virtually as good as cash. Examples are Money Market Funds and
Treasury Bills.
Type of fund that has a fixed number of shares usually listed on a
Closed-End Fund major stock exchange. Unlike open-end funds, closed-end funds do
not stand ready to issue or redeem shares on a continuous basis.
An investment company created with a fixed number of shares which
Closed-end are then traded as listed securities on a stock exchange. After the
investment company initial offering, existing shares can only be bought from existing
shareholders.
A bond backed by a pool of mortgage pass-through securities or
CMO (Collateralized
mortgage loans, which generally supports several classes of
Mortgage Obligation)
obligations.
Collar Upper and lower limits (cap and floor, respectively) on the interest
rate of a floating-rate security.
Units of ownership of a public corporation. Owners typically are
entitled to vote on the selection of directors and other important
Common Stock
matters as well as to receive dividends on their holdings. In the event
that a corporation is liquidated, the claims of sec
Consolidated Financial statement that brings together all assets, liabilities, and
Financial Statement operating accounts of a parent company and its subsidiaries.
Ownership of more than 50% of a corporation's voting shares. A much
smaller interest, owned individually or by a group in combination, can
Controlling Interest
be controlling if the other shares are widely dispersed and not actively
voted.
Corporate securities (usually preferred shares or bonds) that are
Convertibles exchangeable for a set number of another form (usually common
shares) at a prestated price.
A legal entity, separate and distinct from the persons who own it. It
has three chief distinguishing features: limited liability (owners can
Corporation
lose only what they invest); easy transfer of ownership through the
sale of shares; and continuity of existence.
Rate of return that a business could earn if it chose another
investment with equivalent risk - in other words, the opportunity cost
Cost of Capital
of the funds employed as the result of an investment decision. Cost of
capital is also calculated using a weighted average
Stocks that tend to rise in value when the economy is turning down or
Countercyclical Stocks
is in recession.
This part of a bearer bond denotes the amount of interest due, and on
what date and where payment will be made. Bearer coupons are
Coupon
presented to the issuer's designated paying agent for collection. With
registered bonds, physical coupons don't exist. (See "
CSE Casablanca Stock Exchange
Current assets divided by current liabilities. The ratio shows a
Current Ratio
company's ability to pay its current obligations from current assets.
The ratio of interest to the actual market price of the bond, stated as a
percentage. For example, a bond with a current market price of
Current yield
$1,000 that pays $80 per year in interest would have a current yield of
8%.
The Committee on Uniform Security Identification Procedures,
established under the auspices of the American Bankers Association to
CUSIP
develop a uniform method of identifying securities. CUSIP numbers
are unique nine-digit numbers assigned to each series of se
Bank or other financial institution that keeps custody of stock
Custodian
certificates and other assets of a fund, individual, or corporate client.
Cyclical Stocks Stocks that tend to rise quickly when the economy turns up and to fall
quickly when the economy turns down.
Date on which a shareholder must officially own shares in order to be
Date of Record
entitled to a dividend.
Dated date (or issue The date of a bond issue from which the first owner of a bond is
date) entitled to receive interest.
Unsecured debt obligation, issued against the general credit of a
Debenture
corporation, rather than against a specific asset.
Failure to pay principal or interest when due. Defaults can also occur
for failure to meet nonpayment obligations, such as reporting
Default
requirements, or when a material problem occurs for the issuer, such
as a bankruptcy.
Stocks and bonds that are more stable than average and provide a
Defensive Securities safe return on an investor's money. When the stock market is weak,
defensive securities tend to decline less than the overall market.
Removal of a company's security from an exchange because the firm
Delisting did not abide by some regulation or the stock does not meet certain
financial ratios or sales levels.
Amortization of fixed assets, such as plant and equipment, so as to
Depreciation
allocate the cost over their depreciable life.
Greatly reducing government regulation in order to allow freer
Deregulation
markets to create a more efficient marketplace.
A contract whose value is based on the performance of an underlying
Derivative Instrument
financial asset, index, or other investment.
Lowering of the value of a country's currency relative to gold and/or
Devaluation
the currencies of other nations.
The amount by which the purchase price of a security is less than the
Discount
principal amount, or par value.
Short-term obligations issued at discount from face value, with
maturities ranging from overnight to 360 days. They have no periodic
Discount note
interest payments; the investor receives the note's face value at
maturity.
Discount rate The rate the Federal Reserve charges on loans to member banks.
Div Yield Dividend Yield
Spreading of risk by putting assets in several categories of
Diversification
investments.
1. A company's payment of profits to its stockholders. 2. A mutual
fund's payment of profits to its shareholders. 3. A return of part of the
Dividend
premium on participating insurance to reflect the difference between
the premium charged and the combination of ac
Percentage of earnings paid to shareholders in cash. In general, the
Dividend Payout Ratio
higher the payout ratio, the more mature the company.
Annual percentage of return earned by an investor on a stock. The
Dividend Yield yield is determined by dividing the amount of the dividends per share
by the current market price per share.
A popular index in the United States used to measure and report value
Dow Jones Industrial changes in representative US stock groupings. "The Dow"
Average (DJIA) is a price-weighed average of 30 actively traded blue chip stocks
primarily of industrial companies.
The weighted maturity of a fixed-income investment's cash flows,
Duration used in the estimation of the price sensitivity of fixed-income
securities for a given change in interest rates.
DVPS Dividend per share
Earnings Per Share Portion of a company's profit allocated to each outstanding share of
(EPS) common stock.
EFG EFG-Hermes (Egypt)
A provision within a bond giving either the issuer or the bondholder an
option to take some action against the other party. The most common
Embedded option
embedded option is a call option, giving the issuer the right to call, or
retire, the debt before the scheduled matu
EMNEX Emirates Bank International UAE Equity Index
EPS Earnings per Share
Equity Fund A fund that invests primarily in stocks. Also known as a stock fund.
Bond denominated in U.S. dollars or other currencies and sold to
Eurobond
investors outside the country whose currency is used.
EV Enterprise Value
EV / Equity Enterprise Value to Equity Ratio
The interval between a fund distribution's record date and payable
Ex-Dividend date. During this period, investors who purchase shares are not
entitled to the distribution payment.
Price at which the stock or commodity underlying a call or put opti on
Exercise Price
can be purchased (call) or sold (put) over the specified period
The risk that rising interest rates will slow the anticipated rate at
which mortgages or other loans in a pool will be repaid, causing
Extension risk
investors to find their principal committed longer than expected. As a
result, they may miss the opportunity to earn a hi
Par value (principal or maturity value) of a security appearing on the
Face amount
face of the instrument
The interest rate charged by banks on loans of their excess reserve
funds to other banks. The Federal Reserve's ability to add or withdraw
Federal funds rate
reserves from the banking system gives it close control over this rate.
Changes in the federal funds rate are sometim
Fiscal Year A 365-day accounting period for which a company or mutual fund
prepares financial statements.
Tangible property used in the operations of a business, but not
Fixed Asset expected to be consumed or converted into cash in the ordinary
course of events.
A bond for which the interest rate is adjusted periodically according to
Floating-rate bond
a predetermined formula, usually linked to an index.
Floor The lower limit for the interest rate on a floating-rate bond.
Purchase or sale of a specific quantity of a commodity, government
Forward Contract security, foreign currency, or other financial instrument at the current
or spot rate, with delivery and settlement at a specified future date.
Practice whereby a securities or commodities trader takes a position
Front Running to capitalize on advance knowledge of a large upcoming transaction
expected to influence the market price.
An agreement to buy or sell a specific amount of a commodity or
Futures Contract
financial instrument at a particular price on a stipulated future date.
General obligation A municipal bond secured by the pledge of the issuer's full faith, credit
bond and taxing power.
Receipt of shares in a foreign-based corporation traded in capital
Global Depository markets around the world. The advantage to the issuing company is
Receipt (GDR) that they can raise capital in many markets, as opposed to just their
home market. The advantage of GDRs to local investor
Stock of a corporation that has exhibited faster-than-average gains in
Growth Stock earnings over the last few years and is expected to continue to show
high levels of profit growth.
Strategy used to offset investment risk, typically from adverse
Hedge movements in interest rates or securities prices. A perfect hedge is
one eliminating the possibility of future gain or loss.
Private investment partnership or an off-shore investment corporation
in which the general partner has made substantial personal
Hedge Fund
investment, and whose offering memorandum allows for the fund to
take both long and short positions, use leverage and derivati
Bonds issued by lower-rated corporations, sovereign countries and
High-yield bond other entities rated Ba or BB or below and offering a higher yield than
more creditworthy securities, sometimes known as junk bonds.
A company that owns enough voting stock in another firm to control
Holding Company management and operations by influencing or electing its board of
directors. Also called parent company.
Takeover of a company against the wishes of current management
Hostile Takeover
and the board of directors.
IFCG International Finance Corporation Global Index
Statistical composite that measures changes in the economy or in
Index
financial markets, often expressed in percentage changes from a base
period.
Initial Public Offering
A corporation's first offering of stock to the public.
(IPO)
Practice of buying and selling shares in a company's stock by that
Insider Trading company's management or board of directors, or by a holder of more
than 10% of the company's shares.
Right or nonphysical resource that is presumed to represent an
Intangible Asset advantage to the firm's position in the marketplace. Such assets
include copyrights, patents, trademarks, goodwill, and franchises.
Compensation paid or to be paid for the use of money. Interest is
Interest
generally expressed as an annual percentage rate.
Internal Rate of Discount rate at which the present value of the future cash flows of an
Return (IRR) investment equal the cost of the investment.
Bonds considered suitable for preservation of invested capital by the
Investment-grade
rating agencies and rated Baa or BBB or above.
An entity which issues and is obligated to pay principal and interest on
Issuer
securities.
A debt obligation with a rating of Ba or BB or lower, generally paying
interest above the return on more highly rated bonds, sometimes
Junk Bond
known as high-yield. This low-rated bond as it offers higher interest
rates along with higher risk, makes it more appropr
KSE Kuwait Stock Exchange
Leverage The use of borrowed money to increase investing power.
Takeover of a company, using borrowed funds. Most often, the target
Leveraged Buyout company's assets serve as security for the loans taken out by the
acquiring firm.
Liability Claim on the assets of a company.
LIBOR (London The rate banks charge each other for short-term Eurodollar loans.
Interbank Offered LIBOR is frequently used as the base for resetting rates on floating -
Rate) rate securities.
Ability to buy or sell an asset quickly and in large volume without
Liquidity
substantially affecting the asset's price.
Purchase of all of a company's publicly held shares by the existing
Management Buyout
management, which takes the company private.
Charge against investor assets for managing the portfolio of an open-
Management Fee or closed-end fund as well as for such services as shareholder relations
or administration.
Adjust the valuation of a security or portfolio to reflect current market
Mark to the Market
values.
Value of a corporation as determined by the market price of its issued
Market Capitalization
and outstanding common stock. It is calculated by multiplying the
number of outstanding shares by the current market price.
A measure of the ease with which a security can be sold in the
Marketability
secondary market.
Maturity The date when the principal amount of a security is payable.
Date on which the principal amount of a note, bond, certificate of
Maturity Date
deposit, or other debt security becomes due and payable.
Combination of two or more companies, either through a pooling of
interests, where the accounts are combined; a purchase, where the
Merger
amount paid over and above the acquired company's book value is
carried on the books of the purchaser as goodwill; or a con
Interest of shareholders who, in the aggregate, own less than half the
Minority Interest
shares in a corporation.
Control of the production and distribution of a product or service by
Monopoly
one firm or a group of firms acting in concert.
A security representing a direct interest in a pool of mortgage loans.
Mortgage pass- The pass-through issuer or servicer collects payments on the loans in
through the pool and "passes through" the principal and interest
to the security holders on a pro rata basis.
MSM Muscat Securities Market
Also known as an open-end investment company, to differentiate it
from a closed-end investment company. Mutual funds invest pooled
Mutual fund
cash of many investors to meet the fund's stated investment
objective. Mutual funds stand ready to sell and redeem their shar
Option for which the buyer or seller has no underlying security
Naked Option
position.
NBAD National Bank of abu Dhabi
The price of a share of a fund, net of sales charges. Price may vary
Net Asset Value (NAV)
daily.
Method used in evaluating investments whereby the net present value
Net Present Value of all cash flows (such as the cost of the investment) and cash inflows
(NPV) (returns) is calculated using a given discount rate, usually a rquired
rate of return. An investment is acceptable
Net Worth Amount by which assets exceed liabilities.
NIAT Net Income After Tax
A bond that cannot be called for redemption by the issuer before its
Non-callable bond
specified maturity date.
Financing that does not add debt on a balance sheet and thus does not
Off-Balance-Sheet
affect borrowing capacity as it would be determined by financial
Financing
ratios.
Offer The price at which a seller will sell a security.
Offering price The price at which members of an underwriting syndicate for a new
issue will offer securities to investors.
A listed fund that continually creates new shares on demand. The fund
Open-End Fund shareholders buy the shares at net asset value and can redeem them
at any time at the prevailing market price.
Market in which securities transactions are conducted through a
Over the Counter
telephone and computer network connecting dealers in stocks and
(OTC)
bonds, rather than on the floor of an exchange.
Underwriting term describing a new stock issue where there are more
Oversubscribed
buyers than available shares.
P/B Price to Book Ratio
P/E Price to Earnings Ratio
Par value The principal amount of a bond or note due at maturity.
Place where principal and interest are payable. Usually a designated
Paying agent
bank or the office of the treasurer of the issuer.
Price to Book Ratio; Compares a stock's market value to the value of
total assets less total liabilities (book value). Determined by dividing
PB
current stock price by common shareholder equity per share (book
value), style='mso-spacerun:yes'> </span>adjusted for stock splits.
Strategic move by a takeover-target company to make its stock less
Poison Pill
attractive to an acquirer.
The amount by which the price of a security exceeds its principal
Premium
amount.
The unscheduled partial or complete payment of the principal amount
Prepayment
outstanding on a mortgage or other debt before it is due.
The risk that falling interest rates will lead to heavy prepayments of
Prepayment risk mortgage or other loans-forcing the investor to reinvest at lower
prevailing rates.
Value today of a future payment, or stream of payments, discounted
Present Value
at some appropriate compound interest rate.
Price of a stock divided by its earnings per share. The P/E ratio may
Price/Earnings Ratio either use the reported earnings from the latest year (called a trailing
(P/E) P/E) or employ an analyst's forecast of next year's earnings (called a
forward P/E).
Primary market The market for new issues.
Principal The face amount of a bond, payable at maturity.
Sale of stocks, bonds, or other investments directly to an institutional
Private Placement
investor.
Process of converting a publicly operated enterprise into a privately
Privatization
owned and operated entity.
Action by short-term securities or commodities traders to cash in on
Profit Taking
gains earned on a sharp market rise.
Formal written offer to sell securities that sets forth the plan for a
Prospectus proposed business enterprise or the facts concerning an existing one
that an investor needs to make an informed decision.
Contract that grants the right to sell at a specified price a specific
Put Option
number of shares by a certain date.
Cash, marketable securities, and accounts receivable divided by
Quick Ratio
current liabilities.
Designations used by credit rating agencies to give relative indications
Ratings
of credit quality.
Realized Profit (or
Profit or loss resulting from the sale or other disposal of a security.
Loss)
A bond whose owner is registered with the issuer or its agent. Transfer
Registered bond of ownership can only be accomplished when the securities are
properly endorsed by the registered owner.
The risk that interest income or principal repayments will have to be
Reinvestment risk
reinvested at lower rates in a declining rate environment.
REMIC (Real Estate Because of changes in the 1986 Tax Reform Act, most CMOs are now
Mortgage Investment issued in REMIC form to create certain tax advantages for the issuer.
Conduit) The terms REMIC and CMO are now used interchangeably.
An investor who buys securities on his own behalf, not for an
Retail Investor
organization.
Retained Earnings Net profits kept to accumulate in a business after dividends are paid.
Amount, expressed as a percentage, earned on a company's common
Return on Equity
stock investment for a given period.
A municipal bond payable from revenues derived from tolls, charges
Revenue bond or rents paid by users of the facility constructed with the proceeds of
the bond issue.
Offering of common stock to existing shareholders who hold rights
Rights Offering that entitles then to buy newly issued shares at a discount from the
price at which shares will later be offered to the public.
ROaA Return on Average Assets
RoaE Return on Average Equity
Secondary market Market for issues previously offered or sold.
Venture capitlist's first contribution toward the financing or capital
Seed Money
requirements of a start-up business.
Sale of a security not owned by the seller; a technique used (1) to take
Selling Short advantage of an anticipated decline in the price or (2) to protect a
profit in a long position.
Settlement date The date for the delivery of securities and payment of funds.
A measure of a portfolio's excess return relative to the total variability
Sharpe Ratio
of the portfolio.
SHUAA Arabic acronym for Arabian General Investment Corporation
Sinker A bond with a sinking fund.
Money set aside by an issuer of bonds on a regular basis, for the
Sinking fund
specific purpose of redeeming debt.
Risk that a foreign government will default on its loan or fail to honor
Sovereign Risk
other business commitments because of a change in national policy.
Assumption of risk in anticipation of gain but recognizing a higher than
Speculation
average possibility of loss.
The square root of the variance. A measure of dispersion of a set of
Standard deviation
data from its mean.
Stock Dividend Payment of a corporate dividend in the form of stock rather than cash.
The sale of a block of bonds and the purchase of another block of
Swap similar market value. Swaps may be made to establish a tax loss,
upgrade credit quality, extend or shorten maturity, etc.
Ideal sought in corporate mergers and acquisitions that the
Synergy performance of a combined enterprise will exceed that of its
previously separate parts.
An investment strategy that focuses on general market trends and
Top-Down Approach
selects specific stock sectors that can benefit from these broad trends.
Annual return on an investment including appreciation and dividends
Total Return
or interest.
Trade date The date when the purchase or sale of a bond is executed.
A party appointed by an issuer to maintain records of securities
Transfer agent owners, to cancel and issue certificates and to address issues arising
from lost, destroyed or stolen certificates.
Stock reacquired by the issuing company and available for retirement
Treasury Stock
or resale.
A bank designated by the issuer as the custodian of funds and official
Trustee
representative of bondholders.
A measure of trading activity; the volume of shares traded as a
percent of total shares listed during a specified period, usually a day or
Turnover
a year. In the case of mutual funds, turnover is a measure of trading
activity during the previous year, expressed as
To assume the risk of buying a new issue of securities from the issuing
Underwrite
corporation or government entity and reselling them to the public.
Investment funds created with a fixed portfolio of investments that
never changes over the life of the trust. They are created by brokerage
Unit investment trust
houses, and are liquidated as investments within the trust are paid off.
They provide a steady, periodic flow of inc
Characteristic of a security, commodity, or market to rise or fall
Volatility
sharply in price within a short-term period.
Trading activity near the end of a quarter or fiscal year that is designed
Window Dressing
to dress up a portfolio to be presented to clients or shareholders.
The annual percentage rate of return earned on a security. Yield is a
Yield
function of a security's purchase price and coupon interest rate.
A line tracing relative yields on a type of security over a spectrum of
Yield curve
maturities ranging from three months to 30 years.
A yield on a security calculated by assuming that interest payments
Yield to call will be paid until the call date, when the security will be redeemed at
the call price.
A yield based on the assumption that the security remains outstanding
to maturity. It represents the total of coupon payments until maturity,
Yield to maturity
plus interest on interest, and whatever gain or loss is realized from the
security at maturity.
A bond where no periodic interest payments are made. The investor
Zero-coupon bond receives one payment, which includes principal and interest, at
redemption (call or maturity).