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30 Cards in this Set
- Front
- Back
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Four Main Types of Oil & Gas
18-4 |
Exploratory Drilling Program - Areas without proven resources AKA "wild catting"
Developmental Drilling Program - Areas without of proven resources. Lower returns than exploratory drilling Balanced Drilling Program - Drill both exploratory and developmental wells Oil and Gas Income Program - Buy properties with proven oil and gas reserves that are already producing. Have the lowest capital risk. |
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Dissolution of a Limited Partnership - Order of a Claim Payment
18-2 |
1) Secured creditors, then general (unsecured) creditors
2) Limited Partners. Profit claims then capital claims 3) General Partners. Profit claims then capital claims |
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Order Flow Through a Brokerage Firm
15-1 |
Wire Room Order - transmit orders for execution
Purchase and Sale Department - records and processes order executions Margin Department - Monitor Margin Accounts Cashier's Department - Where funds are received and disbursed |
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SEC Rule 144
14-3 |
Sales in any 90 day period are limited to either 1% of the outstanding stock or the average trading volume for the previous 4 weeks - whichever is greater.
Form 144, Notice of offering is effective for 90 days. |
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Allocation Procedures in Agreemet Among Underwriters (how bonds are dsibursed)
11-3 |
Pretty Girls Demand More
1) Pre-sale orders 2) Group Net Account or Syndicate Group Account 3) Designated Orders 4) Member orders at take-down |
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Three Primary Reasons for Refunding a Municipal Bond
10 |
1) To lower interest costs
2) to change the maturity or amortization schedule of the bonds 3) To liberalize the bond's indenture provisions |
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"Flow of funds" Provision on a muni bond indenture - gross revenue pledge
10-3 |
BO is Gross
1) Bond service account for principal interest 2) Operation and Maintenance Fund 3) Debt Service Reserve fund and/or sinking fund 4) Reserve Maintenance Fund, renewal and replacement (depreciation) fund 5) Surplus fund or general fund of a municipality |
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"Flow of Funds" Provision in a muni bond indenture - net revenue pledge
10-3 |
1) Operation and Maintenace fund - used for "regular maintenance"
2) Bond service account for principal and interest 3) Debt service reserve fund or sinking fund 4) Reserve maintenance fund, renewal and replacement (depreciation) fund - used for "irregular" maintenance 5) Surplus fund or general fund of the municipality |
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Sales Load % of a Mutual Fund
8 |
Sales load % =
(OP - NAV) ----------------- OP |
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Mutual Fund Offering Price
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Basic formula
NAV + Sales load (SL) = Offering Price (OP) Offering Price = NAV -------- (100% - SL%) |
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Expense Ratio of a Mutual Fund
(8) |
Operating Expenses
------------------------------ Average Net Assets |
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Reg T Initial Requirements for a Margin Account SHORT
(7) |
For Stock from $0.00 to $5.00 the deposit requirement is $2.50 or 100% of market value (whichever is greater)
$5.00 - $17.00, the deposit is $5.00 Over $17.00, the deposit is Reg T (50%) * The minimum requirement is still $2,000... so be careful of answers lower than $2,000 on the test. |
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Equity on a short margin account
(7) |
Proceeds of the short sale
+ Reg T deposit ------------------------- Credit Balance - Current MV of the short -------------------------- Equity |
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NYSE Minimum Equity Maintenance Requirement =
(7) |
25% x Current market Value
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Conditions of Margin Account
(7) |
Debit balance < half of MV
Excess Equity Debit balance = half of MV Reg T Debit balance > half of MV Restricted Debit balance = 25% of MV Maintenance Call |
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Equity in a Margin Account
(7) |
Current MV - Debit Bal =
Equity in a margin account |
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Hedging with Options
(3) |
Important points about Hedging with Options
1) Long puts protect or hedge long stock positions 2) Long calls protect or hedge short stock positions 3) Investors generally do not sell options to hedge (they are concerned about income with selling options) |
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Credit Spread
(3) |
1) Maximum profit potential is the net credit in the premiums if the options expire.
2) Maximum loss potential is the difference between the two strike prices less the net credit in the premiums 3) Credit spreads must narrow or expire to be profitable |
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Debit Spread
(3) |
1) Maximum loss potential is the net debit in the premiums if the options expire
2) Maximum profit potential is the difference between the two strike prices less the net debit. 3) Debit spreads must widen by more than the net debit to be profitable. |
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Breakeven on a put (Buy or Sell)
(3) |
Exercise price - Premium = Breakeven on a put
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Breakeven on a Call
(3) |
Exercise Price + Premium = Breakeven on a Call
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Conversion Price =
(2) |
Par Value
--------------------------------------- Common Shares Produced |
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Parity Px of Common Stock =
(2) |
market Px of Bond or Pref. Stk
-------------------------------------------- Common shares produced |
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Conversion Ratio
(The number of common shares produced) (2) |
Par Value
------------------------ Conversion Price = # of common shs produced Par value for convert preferred stock is $100 Par value for Convert. bonds is $1,000 |
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Formula to calculate the number of shares upon conversion
(2) |
Par Value
------------------------- Conversion Price = # common shs received |
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Formula for computing the dollar amount of accrued interest
(2) |
Principal x Rate x Time
----------------------------------- 360 = Accrued Interest $ |
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Current yield on a bond
(2) |
Current yield =
Annual Interest ---------------------- Current Market Price |
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# of rights need to purchase each new share =
(1) |
Outstanding shares/ New shares
= # of rights needed to purchase each new share |
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Dividend Payout Ratio (%)
(1) |
Dividends per share (DPS)
-------------------------------------- Earnings per shaer (EPS) = Dividend payout ratio% |
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Current Yield
(1) |
The current yield is
annual dividend / market price |
