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25 Cards in this Set
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depository |
More specifically, it can refer to a company, bank or an institution that holds and facilitates the exchange of securities. Or a depository can refer to a depository institution that is allowed to accept monetary deposits from customers. |
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derivative |
is a security with a price that is dependent upon or derived from one or more underlying assets. The derivative itself is a contract between two or more parties based upon the asset or assets. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies,interest rates and market indexes. Read more: Derivative Definition | Investopedia http://www.investopedia.com/terms/d/derivative.asp#ixzz3xAMcUdl2 Follow us: Investopedia on Facebook |
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put option |
An option contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying security at a specified price within a specified time. |
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call option |
An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument at a specified price within a specific time period. |
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strike price |
The price at which a specific derivative contract can be exercised. Strike prices is mostly used to describe stock and index options, in which strike prices are fixed in the contract. For call options, the strike price is where the security can be bought (up to the expiration date), while for put options the strike price is the price at which shares can be sold.The difference between the underlying security's current market price and the option's strike price represents the amount of profit per share gained upon the exercise or the sale of the option. |
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hedge |
A hedge is an an investment to reduce the risk of adverse price movements in an asset. |
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Canadian savings bond |
A financial product issued by the Bank of Canada. It offers a competitive rate of interest and guarantees a minimum interest rate. |
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marketable securities |
Marketable securities are securities or debts that are to be sold or redeemed within a year. These are financial instruments that can be easily converted to cash such as government bonds, common stock or certificates of deposit. |
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treasury bills |
A short-term debt obligation backed by the U.S. government with a maturity of less than one year. with no interest rate but issued at a price higher than its face value. |
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An investment trust |
that holds income-producing assets and trades units like a stock on an echange. Income trusts attempt to hold assets which will generate a steady flow of income, such as lease payments from an office building. The income is passed on to the unit holders. |
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exchange traded funds |
An ETF, or exchange traded fund, is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. ETFs experience price changes throughout the day as they are bought and sold. |
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ETF (continued ) |
An ETF is a type of fund which owns the underlying assets (shares of stock, bonds, oil futures, gold bars, foreign currency, etc.) and divides ownership of those assets into shares. |
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distressed securities |
A financial instrument in a company that is near or is currently going through bankruptcy. This usually results from a company's inability to meet its financial obligations. As a result, these financial instruments have suffered a substantial reduction in value. Distressed securities can include common and preferred shares, bank debt, trade claims (goods owed) and corporate bonds. |
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leveraged buyouts |
The acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition. Often, the assets of the company being acquired are used as collateral for the loans in addition to the assets of the acquiring company. The purpose of leveraged buyouts is to allow companies to make large acquisitions without having to commit a lot of capital. |
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SEC |
The U.S. Securities and Exchange Commission (SEC) is a federal agency that provides protection for investors and regulates the bulk of the securities industry -- including U.S. stock exchanges, options markets, and other electronic exchanges and securities markets. |
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SRO |
A non-governmental organization that has the power to create and enforce industry regulations and standards. The priority is to protect investors through the establishment of rules that promote ethics and equality. |
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Financial oversight |
Financial Oversight refers to the supervision of financial practice and policy implementation, as well as the review and monitoring of financialtransactions and reports. This process includes budget planning,financial management, reconciliation of Human Resources, Payroll, and General Ledger, and Internal Controls. |
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underwriting |
Underwriting is the process that a lender or other financial service uses to assess the creditworthiness or risk of a potential customer.Underwriting also refers to an investment banker's process of packaging and selling a security on behalf of a client. |
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investment bank |
An investment bank is a financial institution that assists individuals, corporations, and governments in raising financial capital by underwriting or acting as the client's agent in the issuance of securities (or both). |
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brokerage |
A brokerage firm, or simply brokerage, is a financial institution that facilitates the buying and selling of financial securities between a buyer and a seller. Brokerage firms serve a clientele of investors who trade public stocks and other securities, usually through the firm's agent stockbrokers |
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discount brokerage |
A discount brokerage is a business that charges clients significantly lower fees than traditional brokerage firm but without providing investment advice. Discount brokers typically allow investors to buy and sell securities on-line while offering comparatively fewer services and/or support. |
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leverage |
Financial leverage refers to the use of debt to acquire additional assets.Financial leverage is also known as trading on equity. |
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eurobonds |
Usually, a eurobond is issued by an international syndicate and categorized according to the currency in which it is denominated. A eurodollar bond that is denominated in U.S. dollars and issued in Japan by an Australian company would be an example of a eurobond. The Australian company in this example could issue the eurodollar bond in any country other than the U.S.Eurobonds are attractive financing tools as they give issuers the flexibility to choose the country in which to offer their bond according to the country's regulatory constraints. They may also denominate their eurobond in their preferred currency. Eurobonds are attractive to investors as they have small par values and high liquidity. |
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euro currency |
Currency deposited by national governments or corporations in banks outside their home market. This applies to any currency and to banks in any country. For example, South Korean won deposited at a bank in South Africa, is considered eurocurrency. |
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trustee |
an individual person or member of a board given control or powers of administration of property in trust with a legal obligation to administer it solely for the purposes specified. |
