Shareholder debt is a type of risk-bearing equity treated as debt for tax purposes. It is commonly associated with private equity firms and highly leveraged funding arrangements.
A detailed examination of short-dated securities, which are financial instruments that have a maturity period of under five years when first issued. Understand their types, benefits, key events, and more.
An in-depth look into Single Name Credit Default Swaps (CDSs), their definition, function, and implications in financial markets.
A comprehensive guide to Single-Name Credit Default Swaps (CDS), their structure, use in finance, key historical events, formulas, and practical examples.
Explore the concept of Soft Loans, their types, historical context, key events, mathematical models, importance, applicability, related terms, and more.
An in-depth comparison between Stock ETFs and Commodity ETFs, highlighting their features, advantages, and applications.
An in-depth exploration of stock options, their history, types, importance, and applications in the world of finance.
Stock Options are financial instruments giving employees or executives the right, but not the obligation, to buy or sell company stock at a predetermined price within a specified timeframe, often used as a form of compensation and incentive.
An in-depth exploration of Stock Returns Notes, including historical context, key events, types, detailed explanations, mathematical models, importance, and applicability in finance.
Stop Orders are a type of trade order that activates once a set price level is reached, converting into market orders that may become held orders.
The fixed price at which the option holder can buy (call) or sell (put) the underlying futures contract.
An in-depth guide on Structured Investment Vehicles (SIVs), their history, types, key events, and their role during the 2007 financial crisis.
A Substitute Cheque, also known as an Image Replacement Document (IRD), is a paper copy of an original cheque that is created digitally as part of the cheque truncation process.
A comprehensive guide to Sukuk, the Islamic equivalent of bonds, compliant with Shariah principles.
A comprehensive overview of SWAPs including their types, historical context, key events, importance, applicability, examples, related terms, comparisons, interesting facts, and more.
Swaps are financial derivatives wherein two parties agree to exchange cash flows or other financial instruments based on specified terms.
A comprehensive guide to the tax treatment of various financial instruments, including ISOs, NSOs, Traditional and Roth IRAs, and their respective tax implications.
Exploring the financial products and instruments that facilitate international trade, from letters of credit to export credit insurance.
A comprehensive exploration of financial instruments and products that facilitate international trade.
A comprehensive explanation of trading flexibility, its significance in financial markets, and how it differentiates financial instruments like SPDRs from mutual funds in terms of trading dynamics.
Understanding Tranche - a specific class of bonds within an offering of bonds. Discover its historical context, types, key events, importance, applicability, examples, and more.
An in-depth exploration of transferable and negotiable instruments in finance, their historical context, types, key events, mathematical models, and real-world applications.
An in-depth look at Treasury Bills, their historical context, types, importance, examples, and related financial concepts.
A comprehensive overview of Treasury Bills, short-dated government securities issued at a discount and regarded as highly liquid financial assets.
An in-depth look at underlying assets, measures, or obligations that form the foundation for derivatives such as options and futures contracts.
A detailed exploration of unpaid cheques, their causes, implications, historical context, examples, and important considerations.
An in-depth exploration of the valuation date, including its historical context, types, key events, explanations, formulas, importance, applicability, examples, related terms, and more.
Vanilla Options are standard financial options that do not have any barrier levels or complex features. They are the most straightforward type of option contract.
A comprehensive guide to understanding variable-rate loans, their mechanics, types, historical context, key events, and their significance in finance.
A Variable-Rate Note (VRN) is a bond that features an interest coupon adjusted at regular intervals based on prevailing market rates, differing from floating-rate notes by having an adjustable margin.
An in-depth exploration of variable-rate securities, their types, historical context, key events, formulas, and applicability in finance.
Measures the sensitivity of an option's price to changes in the volatility of the underlying asset.
An in-depth look into voting shares, their historical context, significance in corporate governance, and differences from non-voting shares.
Vouchers are a form of scrip issued for specific entitlements, while coupons generally grant discounts or deals. Discover the nuances and applications of these financial instruments in this detailed comparison.
A comprehensive examination of War Loans, their historical context, types, key events, explanations, and importance.
A comprehensive overview of warrants, including share warrants, warehouse warrants, key events, detailed explanations, examples, and more.
Warrants are financial instruments that grant the holder the right, but not the obligation, to buy or sell an underlying stock at a specified price before expiration.
An annuity in advance is a series of equal or nearly equal payments made at the beginning of each period, commonly used in lease agreements and certain types of loans.
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.
In-depth definition and explanation of a Bank Draft, its key features, and comparison with a Bill of Exchange. Includes historical context, examples, and FAQs.
A detailed overview of the Best Efforts Arrangement where investment bankers act as agents with the authority to sell securities without the obligation to buy them outright.
A comprehensive guide to Bills of Exchange, covering their definition, types, usage, historical context, and related financial instruments.
A detailed explanation of bond premium, its amortization, special considerations, and examples.
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.
A comprehensive guide to understanding Call Premium, its significance in options trading and bonds, including calculation, examples, and related terms.
In-depth coverage of cash equivalents, including types, examples, historical context, applicability, comparisons, related terms, and FAQs.
A comprehensive guide to the Chicago Board of Trade (CBOT), the world's oldest futures and options exchange, its history, operations, and merger with CME Group.
Understanding the Closed Period in Bond Issuance: its importance, implications, and relationship with callable bonds.
An in-depth exploration of Collateralized Bond Obligations (CBOs), their structure, features, historical context, types, and their role within the financial markets.
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.
Common stock equivalent refers to securities such as preferred stock, convertible bonds, or warrants that can be converted into common stock, potentially diluting the equity of existing common shareholders.
A `coupon bond` is a bond issued with detachable coupons that must be presented to a paying agent or the issuer for semiannual interest payments. It is a type of bearer bond, meaning whoever presents the coupon is entitled to the interest.
Currency Futures are contracts in the futures markets that are for delivery in a major currency such as U.S. dollars, Euros, or Japanese yen. Corporations that sell products globally can hedge the risk of adverse exchange rate movements with these futures.
In-depth exploration of currency swaps, including their mechanism, types, applications, historical context, and significance in financial markets.
A detailed exploration of Deferred Interest Bonds, their features, types, implications, and practical applications.
A detailed explanation of Deferred-Payment Annuities, how they work, their types, benefits, and their usage in financial planning.
A demand loan is a type of loan that is payable on request by the creditor rather than on a specific date, offering flexibility to both lenders and borrowers.
Depositary Receipts facilitate global investment by allowing investors to hold shares in foreign companies through domestic financial securities.
An in-depth exploration of Derivative Securities, their types, applications, and impact in financial markets.
Exchange-Traded Notes (ETNs) are senior unsecured debt instruments that track the performance of a specific index, offering a unique investment option with both returns and risks tied to the creditworthiness of the issuer.
Exercise refers to the act of utilizing a right available in a contract. For example, in options, it involves buying the property, and in convertible securities, it means making the exchange.
The exercise price, also known as the strike price, is the fixed price at which the holder of an option can buy (in the case of a call option) or sell (in the case of a put option) the underlying stock, or the price at which a convertible security can be redeemed for shares of stock.
Comprehensive explanation of face value, its significance in financial instruments such as bonds and checks, and comparison with market value.
A comprehensive overview of financial futures contracts, their characteristics, types, examples, and their relationship with interest rates.
An overview of Flash Trading as a specific strategy within High-Frequency Trading, exploring its mechanisms, applications, and controversies.
An in-depth guide to Floating Securities, covering its various definitions, implications in finance, and key considerations for investors and traders.
A forward contract entails the actual future purchase or sale of a specific quantity of a commodity, financial instrument, or other asset at a price agreed upon today. Learn about its features, types, and real-world applications.
A futures contract is an agreement to buy or sell a specific amount of a commodity or financial instrument at a predetermined price on a specific future date, obligating both parties to transact unless the contract is sold to another party before the settlement date.
A comprehensive guide to understanding Guarantee Letters, their uses, examples, historical context, and relevance in finance and banking.
An in-depth overview of Instrumentality in the context of federal agencies whose obligations, while not direct obligations of the U.S. government, are sponsored or guaranteed by the government, backed by the full faith and credit of the government.
An in-depth exploration of interest rate swap agreements, their functioning, types, historical context, and practical applications.
Comprehensive coverage of Kangaroo Bonds, covering their definition, types, special considerations, and historical context. Understand the key aspects and benefits of Kangaroo Bonds in this detailed entry.
Marketable securities refer to financial instruments that are liquid, can be quickly converted into cash, and are often kept as short-term investments on a corporation's balance sheet. Examples include government securities, banker's acceptances, and commercial paper.
A mortgage-backed certificate is a financial instrument backed by mortgages, where investors receive payments from the interest and principal on the underlying mortgages.
A comprehensive definition of Note and Note Payable, which are written promises to pay a specific sum of money to a designated party by a definite or determinable future date. This entry also explores related terms like Promissory Note and provides examples and historical context.
An 'On Demand' financial instrument allows the holder to request payment at any time. This includes instruments like demand notes, which lack a specified due date.
Options refer to things one purchases to add to a basic product, alternative courses of action that face a decision-maker, and the financial right, but not obligation, to buy or sell property.
Order Paper, a negotiable instrument that is payable to a specified person or their assignee rather than to cash or bearer. Detailed overview including types, special considerations, examples, and related terms.
Paper gold certificates are financial instruments that represent ownership of a certain amount of gold. These certificates can be converted into physical gold at the issuer's office, whether private or governmental. Often used in exchanges for convenience.
Exploring Paper Money: Government-issued certificates widely accepted as reliable media of exchange within the economy
A pass-through certificate is an investment that receives income from another form, often a pool of mortgages, with income passed through to the certificate holders.
A perpetuity is a financial instrument that pays a never-ending series of periodic payments. It is commonly used in the contexts of finance, economics, and legal frameworks such as the rule against perpetuities.
An in-depth explanation of Power of Attorney (POA), a legal instrument used to grant an agent the authority to act on behalf of a principal, including types, applications, and legal implications.
A comprehensive explanation of a primary beneficiary in financial and legal contexts, detailing their role, importance, and distinctions from other types of beneficiaries.
A put option contract grants the holder the right to sell a specific number of shares at a specified price by a certain date. It is considered a capital asset when held by a nondealer.
A detailed examination of recourse loans; their definition, types, usage in finance and real estate, benefits, drawbacks, and comparison with nonrecourse debt.
Rediscount involves the re-discounting of short-term negotiable debt instruments, such as bankers' acceptances and commercial paper, that have already been discounted with a bank.
Reset Bonds are unique financial instruments where the interest rate is periodically adjusted to ensure the bonds trade at their original value. They are designed to mitigate interest rate risk and provide stability to investors.
A Reverse Annuity Mortgage (RAM) allows elderly homeowners to monetize the equity in their fully-paid-for homes, providing them with a fixed monthly income or a lump sum while gradually relinquishing equity.
A seasoned loan refers to a loan bond or mortgage on which several payments have been collected. It is generally easier to sell a seasoned mortgage compared to a new one that has not yet accumulated a payment history.
A comprehensive guide to Secured Debt, its types, advantages, disadvantages, and real-world examples.
Detailed explanation of Securities including types, historical context, examples, and key considerations.
Exploring senior debt, including its definition, types, and role in corporate finance
A comprehensive explanation of the standby fee, which is a sum required by a lender to provide a standby commitment, and the conditions under which it may be forfeited.
Detailed annual publication by Ibbotson & Associates providing comprehensive historical data and analysis on stocks, bonds, bills, and inflation.
A 'Sweetener' refers to an added feature in a securities offering designed to make the securities more attractive to purchasers.
Comprehensive definition and explanation of the term, including its applications in contracts, loans, and life insurance policies.
A comprehensive guide on Trade Acceptance, a time draft guaranteed by a non-bank firm and sold in the secondary money market. Learn its definition, types, historical context, and comparisons with similar financial instruments.
An in-depth exploration of the underlying futures contracts, which serve as the basis for options on futures. This includes definitions, examples, historical context, applications, and related terms.
Comprehensive guide to Asset-Backed Commercial Paper (ABCP), its definition, mechanism, advantages, and various applications in the financial world.
