An in-depth exploration of Zero Coupon Bonds, their historical context, types, key events, mathematical formulas, diagrams, and importance in financial markets.
A detailed exploration of Zero Coupon Bonds, their structure, functionality, historical context, importance, applicability, and more.
Zero Coupon Bonds are a type of fixed-income security issued at a discount and repay principal at maturity without periodic interest payments. They can still yield positive returns if purchased at a deep discount.
A detailed exploration of the Zero-Cost Collar options trading strategy, its definition, components, applications, examples, and more.
Zero-coupon bonds are a type of bond that does not pay periodic interest. Instead, they are issued at a discount to their face value and mature at par. Learn more about their types, applications, and historical background.
Zombie Stocks are the shares of companies that are not bankrupt but are financially insolvent, barely surviving, and often unable to pay off their debts or generate significant profit.
The [NOT RATED (NR)] indication used by securities rating services and mercantile agencies denotes that a security or company has not been rated, carrying neither negative nor positive implications.
A comprehensive overview of the 12b-1 fee, a promotional fee charged by mutual funds, including its purpose, calculation, historical context, examples, and related terms.
A 401(k) plan is a company-sponsored retirement savings plan that allows employees to contribute a portion of their earnings pretax, with taxes applied at withdrawal. It includes investment options like stocks, bonds, and money market instruments.
The Accounting Rate of Return (ARR) method is used for estimating the rate of return from an investment utilizing a straightforward, non-discounted approach.
Comprehensive coverage on accretion, encompassing asset growth through internal or external means, and bond price adjustments from discount to par.
Add-On Interest involves computing interest on the original amount borrowed, leading to a stated rate much lower than the Annual Percentage Rate (APR).
An in-depth explanation of After-Tax Basis, a method for comparing returns on corporate taxable bonds versus municipal tax-free bonds.
An in-depth look at the rate of return on an equity interest, accounting for financing costs and tax implications.
Comprehensive explanation of after-tax proceeds from resale, describing the final amount left for the investor after all transaction costs and personal income taxes.
The After-Tax Real Rate of Return represents the true earning on an investment after adjustments for taxes and inflation. Understand how it highlights the actual financial gain.
A comprehensive guide to Aggressive Growth Funds in the stock and mutual fund markets.
Alpha represents the amount of return expected from fundamental causes such as the growth rate in earnings per share, contrasting with Beta, which measures volatility.
Explore alternative investments encompassing a range of options beyond traditional stocks and bonds, including art, coins, precious metals, stamps, arbitrage, derivatives, hedge funds, leveraged buyouts, private equity, real estate, and venture capital.
An American Depositary Receipt (ADR) is a financial instrument issued by U.S. banks that allows domestic investors to buy shares in foreign companies more conveniently. ADRs trade on U.S. stock exchanges and over-the-counter markets like domestic stocks.
Understanding the Compound Amount of One Per Period: Formula, Examples, and Applications
An annuitant is an individual who receives the benefits of an annuity, a financial product that guarantees a series of payments for life or a specified period.
Detailing the process of beginning a series of payments from the capital built up in an annuity with conditions on fixed amounts, periods, or lifetimes.
Annuity Due is a type of annuity where payments are made at the beginning of each period. Explore its definition, mathematical formulas, types, and more.
Annuity Income provides regular payments derived from an annuity investment, offering financial stability and predictability for individuals in retirement or other financial planning scenarios.
The expected duration an investor plans to hold a particular investment before selling it.
A comprehensive guide to the approved list of investments that mutual funds or other financial institutions are authorized to make. This list can be statutory and is critical to ensure fiduciary responsibility.
An arbitrage bond is issued by a municipality to gain an interest rate advantage by refunding higher-rate bonds before their call date. The proceeds from the lower-rate refunding issue are invested in higher-yielding treasuries until the first call date of the higher-rate issue being refunded.
Asset-Backed Securities (ABS) are financial instruments backed by loan paper or accounts receivable originated by banks, credit card companies, or other providers of credit, often enhanced by a bank letter of credit or by insurance coverage provided by an external institution.
Detailed explanation of the process where the investing public absorbs a new issue of stock once sold by the issue's underwriters.
An in-depth look at the concept of 'AT PAR' in securities valuation, including its significance, historical context, and related terms.
Detailed examination of 'At Risk' including its definition, types, historical context, examples, and applicability in investment scenarios.
An in-depth exploration of Automatic Reinvestment focusing on Dividend Reinvestment Plans (DRIPs), their mechanisms, benefits, and applications.
A comprehensive overview of Automatic Withdrawal mutual fund programs, including mechanics, benefits, types of payment, and considerations for investors.
The Average Down strategy involves buying additional shares of a stock as its price decreases, thereby lowering the average cost per share.
An in-depth exploration of the back office, encompassing its role, functions, and significance in banking and brokerage houses.
Balanced Mutual Funds invest in a mix of stocks, bonds, and other securities to achieve a balance of risk and return.
The Band of Investment serves as a method to estimate a company's cost of capital by weighing the cost of debt and equity. This concept is fundamental in corporate finance and is closely related to Weighted Average Cost of Capital (WACC).
The Banker's Year is a financial convention that standardizes the length of a month at 30 days and a year at 360 days, facilitating easier calculation of interest rates and other financial metrics.
A comprehensive explanation of Bear Markets, their characteristics, examples, historical context, and comparisons with Bull Markets.
An overview of Before-Tax Cash Flow (BTCF), its significance in financial analysis, calculation methods, and its applications in various industries.
Understanding the concept of Below Par pricing, especially in the context of bonds, and its implications for investors.
An in-depth overview of Best's Rating, its importance in the insurance and investment sectors, and its implications for financial soundness.
An in-depth analysis of the Black-Scholes Option Pricing Model, developed by Fischer Black and Myron Scholes, which is used to determine whether options contracts are fairly valued. The model incorporates volatility, interest rates, underlying stock prices, and time to expiration.
An explanation of the blended value concept, which represents the average value of tendered stock and residual stock in a self-tender offer.
A Blind Pool is a limited partnership that does not specify its intended investments, focusing instead on the promoter's track record.
In finance, a block refers to a large quantity of stock or a large dollar amount of bonds held or traded. Typically, 10,000 shares or more of stock and $200,000 or more worth of bonds are considered a block.
A deeper look into Blue-Chip Stocks, their significance in investment strategy, historical context, and practical applications.
A comprehensive exploration of bond discount, its causes, implications, and examples, including zero-coupon bonds.
A detailed explanation of bond premium, its amortization, special considerations, and examples.
An in-depth look at the method of bond rating, including the role of rating agencies such as Fitch Ratings, Standard & Poor's, and Moody's Investors Service, and the implications of different bond ratings.
Comprehensive overview of Bond Yield, its various types, calculation methods, and its significance in finance.
Book-Entry Securities are financial instruments that exist solely in electronic form and do not have physical certificates. These include various types of bonds, stocks, and other securities recorded and tracked through computerized systems.
An in-depth look into how borrowing against securities can amplify investment potential, including mechanisms, benefits, risks, and regulatory considerations.
A Bottom Fisher is an investor who seeks opportunities in investments that have fallen to their lowest prices and are expected to bounce back. This strategy sometimes involves investing in bankrupt or near-bankrupt firms.
An in-depth exploration of the Bottom-Up Approach to Investing, focusing on the search for outstanding performance of individual stocks before considering the broader market perspective. This approach contrasts with the Top-Down Approach to Investing.
An in-depth examination of what it means when a money market fund's NAV falls below $1, causing significant implications for investors and the financial market.
The interest rate at which stockbrokers borrow from banks to cover clients' securities positions, usually close to the prime rate.
Detailed definition and explanation of Broker-Dealer, its functions, regulations, types, and its role in financial markets.
An in-depth exploration of brokerage allowance, a commission paid by the seller to the broker for arranging a sale, typically defined as a percentage of the selling price. This term often applies to transactions where the broker does not take possession of the goods sold.
A Brokered CD is a Certificate of Deposit issued by a bank or thrift institution and sold by a brokerage firm. These CDs often offer higher yields, federal deposit insurance, and liquidity through a secondary market.
Build to Suit is a commercial real estate arrangement where a landowner constructs a building as specified by a potential tenant, then leases both the land and building to the tenant.
A bull market signifies a prolonged period of rising prices in the market for assets such as stocks, commodities, and bonds, reflecting investor confidence and inducing a self-sustaining cycle of speculation and investment.
Bullion Coins are composed of precious metals such as gold, silver, or platinum, having intrinsic value as bullion. These coins are traded for their metal content rather than rarity or artistic value.
A Buy Order is an instruction to a broker to purchase a specified quantity of a security at either the market price or a stipulated price.
An informative overview of buying on margin, its regulations, types, examples, historical context, and more.
The concept of a buyout involves the acquisition of a controlling percentage of a company's stock to take over its assets and operations, often conducted through negotiation or a tender offer. Includes details on leveraged buyouts and related terms.
A comprehensive explanation of the term 'CALL' in Banking, Bonds, and Options, including different types, examples, and comparisons.
A comprehensive guide to understanding call features or call provisions in bond indentures, including schedules, redemptions, call premiums, and call prices.
A comprehensive guide to understanding Call Premium, its significance in options trading and bonds, including calculation, examples, and related terms.
Call Price refers to the price at which a bond or preferred stock with a call feature can be redeemed by the issuer. It is also known as the redemption price. This entry explores call price, call feature, call premium, and their implications.
Detailed examination of callable securities, financial instruments redeemable by the issuer before the scheduled maturity, typically involving a premium price.
Capital calls are requests for additional funds from investors to cover deficits, primarily seen in private equity and venture capital domains. Corporate stockholders are usually not legally obligated to meet these calls.
An in-depth exploration of capital gain distribution, its types, special considerations, and examples.
In-depth explanation of capital gain dividend, its implications for shareholders, and its designation by regulated investment companies.
Capital Investment refers to funds invested in a business or an asset expected to be used for an extended period. It encompasses expenditures on long-term physical and financial assets such as property, plants, equipment, and stock.
An in-depth look at the financial framework of a corporation, focusing on long-term debt, preferred stock, and net worth, and distinguishing it from Financial Structure.
Understanding the Capitalization Rate in Real Estate and Investments
An in-depth look at the phenomenon of capitulation in financial markets, where investors lose hope and sell off, leading to a market bottom and bullish sentiment.
Carry Trade involves borrowing money in a low-interest-rate market and investing in high-return markets for profit.
A detailed explanation of cash dividends, their types, taxation, significance, historical context, and comparison with stock dividends and yield.
A detailed overview of cash reserves, their importance, types, applications, and considerations for individuals and businesses.
A detailed examination of the Cash-on-Cash Return method, which calculates yield by dividing annual dollar income by the total dollar invested. This entry also explores related measures such as Internal Rate of Return and Yield to Maturity.
Speculative stocks known as 'CATS AND DOGS' typically have short histories of sales, earnings, and dividend payments. They gain attention in bull markets where even risky investments see appreciation.
A Certificate of Accrual on Treasury Securities (CATS) is a type of zero-coupon U.S. Treasury security that does not pay periodic interest but is sold at a discount and matures at face value.
Comprehensive entry on Certificate of Accrual on Treasury Securities (CATS), detailing their features, benefits, historical context, and applications in retirement and education planning.
The Chicago Board Options Exchange (CBOE) is a leading marketplace for trading options and derivatives, providing essential services and tools for investors.
The Chicago Mercantile Exchange (CME) is a leading global derivatives marketplace, known for offering a diverse range of futures and options products.
In-depth overview of Classified Stock, its types, characteristics, and applicability in corporate finance.
The evolution of 'clipping coupons' from a financial habit involving coupon bonds to a modern-day practice of saving money through discounts.
A closed fund is a mutual fund that has stopped issuing shares due to its large size. Learn about its characteristics, types, and implications.
Understanding the Closed Period in Bond Issuance: its importance, implications, and relationship with callable bonds.
A Closed-End Mutual Fund operates with a fixed number of shares in the market, as opposed to the Open-End Mutual Fund that issues new shares to meet demand.
Closet Indexing involves structuring a mutual fund or managed portfolio to nearly replicate an index, effectively avoiding the risk of underperforming it while charging regular fees for active management.
An in-depth exploration of Collateralized Mortgage Obligations (CMOs), their structure, types, applications in financial markets, and key considerations.
An in-depth exploration of Collateralized Bond Obligations (CBOs), their structure, features, historical context, types, and their role within the financial markets.
A Collateralized Mortgage Obligation (CMO) is a type of mortgage-backed security that divides mortgage pools into various tranches with differing maturities and risk levels.
A detailed overview of collectibles, including their types, investment value, and applications in economic activities.
Commercial Paper: Short-term obligations with maturities ranging from 2 to 270 days, issued by banks, corporations, and other borrowers. These unsecured instruments provide flexible debt options at potentially lower rates.
Commodities Futures are contracts in which sellers promise to deliver a given commodity by a certain date at a predetermined price. The contract specifies the item, price, expiration date, and standardized unit to be traded.
