Glossary Of Terms – Client Resources

Keeping up with the increasing number of investment products and services available on the market today can be complicated. This glossary was created to help you understand a few of the more common investment and financial terms you may encounter. Your financial advisor can explain these conditions more completely and discuss with you those relevant to your situation.

Accrued interest – The eye due on a bond since the last interest payment was made. The customer of the connection will pay the market price plus accrued interest. Acquisition – The acquiring of control of one corporation by another. In “unfriendly” takeover tries, the potential buying company might provide a price well above current market values, new securities and other inducements to stockholders.

The management of the subject company might require a much better price or try to link up with a third company. U.S. bank, or investment company instead of the foreign shares kept in trust by that bank or investment company, facilitating the trading of international shares in U therefore.S. American Stock Exchange (AMEX) – The next largest stock exchange in the United States, situated in the financial area of New York City.

Amortization – Accounting for expenditures or charges as appropriate rather than as paid. Includes such methods as depreciation, depletion, write-off of intangibles, prepaid expenses, and deferred charges. Annual record – The formal financial record released annually with a company. The annual report shows assets, liabilities, revenues, year expenses, and earnings – the way the company stood at the close of the business enterprise, how it fared profit-wise during the year, as well as other information appealing to shareowners.

Arbitrage – A method employed to consider the advantage of differences in price. 50 a share, less expenses. Auction market – The system of trading securities through agents or agents with an exchange such as the New York Stock Exchange. Buyers contend with other buyers while sellers contend with other sellers for the most beneficial price.

Auditor’s report – Often called the accountant’s opinion, it’s the declaration of the accounting firm’s work and its own opinion of the corporation’s financial statements, particularly if they comply with the normal and accepted practices of accountancy generally. Averages – Various ways of measuring the trend of securities prices, one of the most popular of which is the Dow Jones Industrial Average of 30 commercial stocks listed on the brand-new York Stock Exchange. The costs of the 30 shares are totaled and then divided by a divisor that is supposed to pay for previous stock splits and stock dividends, and that is changed every once in awhile.

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  • A reversal of speculative positions, which has had temporary results on asset prices

As a result, point changes in the average have only the vaguest relationship to dollar-price changes in stocks contained in the average. Balance sheet – A condensed financial statement showing the type and amount of a company’s assets, liabilities, and capital on a given time. In dollar amounts, the balance sheet shows what the company owned, what it owed and the ownership interest in the ongoing company of its stockholders.

Basis point – One gradation on a 100-point scale representing 1%; found in expressing variations in the yields of bonds especially. Fixed income yields vary often and slightly within one percent and the basis-point scale easily expresses these changes in hundredths of 1%. For example, the difference between 12.83% and 12.88% is 5 basis points.

Bear – A person who believes the market will decline. Bear market – A declining market. Bearer bond – A relationship that will not have the owner’s name signed up on the books of the issuer. Principal and Interest, when due, are payable to the holder. Bet and Asked – referred to as a quotation or quote Often.

The bid is the best price anyone wants to cover a security at a given time, the asked is the lowest price anyone shall take at the same time. Block – A large holding or transaction of stock – regarded as 10 popularly,000 shares or more. Blue chip – An organization known nationally for the product quality and wide approval of its products, and because of its ability to generate income and pay dividends.