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51 Cards in this Set
- Front
- Back
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what is a synthetic short
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selling at the money calls
buying an equal number of at the money puts |
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what is a Cabinet Trade
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a trade of a deep out of the money Option
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what is an intermarket sweep order (ISO)
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limit orders that must be executed in one specific market center even if another has a better quote, disobeying the order protection rule. typically used by algo investors
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order protection rule
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reg NMS 611 trade through rule protects you from getting a fill worse than the quote on a certain exchange.
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what is a Transfer Agent
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bank or similar financial institution that maintains records of transactions and cancels and issues certificates of securities.
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what is Open Rotation
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orders to be executed only during initial trading roatation of specified day for sole purpose of getting opening price.
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What is the regulatory Element
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for all registered people, requires a CBT program within 120 days of 2 year cert date and every three years after.
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What is the firm element
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requires all BDs to establish a formal training program to keep registered persons up to date.
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What is Securities Act of 1933
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Truth in Securities Act or the Securities Act. Made the Fed govt involved in financial instruments
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what is a synthetic long
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buying at the money calls
selling an equal amount of at the money puts |
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what is a spread order
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buy and sell the same number of options contracts
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what is a Combination Order
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a number of calls and the same number of puts
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what is a RESERVE ORDER
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has a displayed size and a reserve size not displayed
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what is a FACILITATION order
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executed in a cross transaction with an order for a public customer
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what is a RATIO order
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spread straddle or combo where the ratios are factors of 2 or 3 to 1 buy or sell.
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what is an attributable order
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displays the User Firm ID
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What is Regulation NMS
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Reg NMS is for National Market System. 2007 to make an efficient and non fragmented National Market System
- Order Protection 610 - Access Rule 611 - quotes - 612 sub penny rule - 600, 601, 603 Market Data Rules |
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What is a RISK BASED HAIRCUT
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Artificial reduction of Asset Value to deal with margin and avoid ill-timed margin call.
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Authorized Stock
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Shares a corporation is legally permitted to issue.
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Short Exempt
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May be traded short on a downtick. Normal has to go on uptick.
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What is Step-Out Trading
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When one brokerage executes an order but gives another firm credit or some of the commission for the trade.
maybe a thank you gesture for others research and analysis. |
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What is a Global Depository Receipt (GDR)
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- Cert issued by a depository bank to invest in foreign companies and emerging markets.
- bank purchases shares of foreign companies to deposit in account. |
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What is a Transfer Price
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A price to trade/transact between divisions of a company.
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What is PAR value.
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- Bond - Face value of bond
- Stock - typically par value of .01 or none at all. - Archaic |
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What is a cash secured put?
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Selling a put of a stock you would like to own a little lower. You have to have the cash to buy the stock in your account.
Neutral to slightly bullish. |
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What is a Unit Investment Trust
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fixed unmanaged portfolio usually of stocks and bonds. Usually $1000 increments can be resold in secondary market.
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What is a face-amount security company.
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Issues debt securities backed by real assets.
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What is regulation FD
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Regulation Fair Disclosure from 2000. just says all investors need to get the info, like conference calls
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prevention of misuse of nonpublic info
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from sec act 1934
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supervision is regulators option principlal
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series 24
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cash settlement
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2:00 2:30 is time for delivery of money
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when is regular settlement for options
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next day
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fail to deliver is how many days
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13
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broad based index options
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930 to 415
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register principal
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ceo and cco
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options expire
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3rd fri of every month
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contract setttlement is how long
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3 days
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100 % margin requirement
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reg T
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AML
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once per year, must be documented
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trade confirms
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20 mins
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nasdaq pink sheets
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3rd market 30 secs
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trade confirms
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20 mins
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nasdaq pink sheets
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3rd market 30 secs
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only sell side reports on ACT
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1933 = must be filed with SEC, prevents fraudulent activity
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1934 = secondary trading, prevents fraudulent practices, more oversight with the SROs
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P&S – when money is sent, it must be posted within 24 hours
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Warrant – long term, price higher than market price, may trade with or separate with units
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Factors that affect premium – volatility, time left, intrinsic value, interest rate
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Right – short term, price below market price, may trade with or separate with common stock
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AML = occurs once a year & must be documented
You don’t report marriage for the U4 All options outside of Japan is 10,000 Japanese contracts are 1,000,000 1 point premium = $100 If bullish – buy calls or sell puts Exchange traded options are also known as listed options Eastern account (key words) – unsold, undivided Western account (key words) – sold, divided Regulation SP is the privacy act = privacy of customers information |
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