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Market Maker  

2010-08-26 08:52:13|  分类: 外语学习 |  标签: |举报 |字号 订阅

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market maker

A brokerage or bank that maintains a firm bid and ask price in a given security by standing ready, willing, and able to buy or sell at publicly quoted prices (called making a market). These firms display bid and offer prices for specific numbers of specific securities, and if these prices are met, they will immediately buy for or sell from their own accounts. Market makers are very important for maintaining liquidity and efficiency for the particular securities that they make markets in. At most firms, there is a strict separation of the market-making side and the brokerage side, since otherwise there might be an incentive for brokers to recommend securities simply because the firm makes a market in that security.

With an abstracted air, speak with acrimony, book accommodation at a hotel, flatter excessively=adulate, the advent of spring, aerial tanker, aerial music, an affable smile,

Affable, amiable, amicable, affinity, affray, afflict, inflict, conflict,

His fiery speech agitated the crowd.

All the time they agonized and prayed. Airy chambers, an airy apparition, alienate him from his friends, it is alleged that…, allegiance to one’s native land,

It was clear she was alluding to Jane. Allude, interlude, elude, an ambiguous answer,

The situation has ameliorated. An amiable gathering, anachronic, anachronism,

Ancillary, subsidiary, subordinate, have animosity against/towards

statutory stock option

A type of employee stock option which provides tax advantages for the employer that a non-qualified stock option does not, but which is subject to more stringent requirements. In general, an incentive stock option must only be granted to employees, under a specific plan document that states how many options will be given to each employee, within 10 years of receiving shareholder approval and the exercise price must equal or exceed the market price at the time of grant. The option can only be exercised within 10 years of receipt, and there are several rules governing how exercise of the option affects the employer's tax burden.

change of control

A process undergone by a company when control is shifting from one party to another party. Change of control occurs when a company changes control for any reason, including new leadership or an acquisition of the company. When a company changes control, an investor must evaluate how this could change the value of the company.

Fisher effect

An indicator of the return expected per share. It equals free cash flow per share divided by the current market price per share (or equivalently, the company's overall cash flow divided by its market capitalization). This is similar to earnings yield, except it considers cash flow instead of earnings, and is used primarily by individuals who believe cash flow to be a more accurate indicator than earnings.

free cash flow yield

An indicator of the return expected per share. It equals free cash flow per share divided by the current market price per share (or equivalently, the company's overall cash flow divided by its market capitalization). This is similar to earnings yield, except it considers cash flow instead of earnings, and is used primarily by individuals who believe cash flow to be a more accurate indicator than earnings.

store of value

A commodity, currency or other type of capital that is tradable and can be stored for future use. It is a fundamental component of the economic system because it allows trade to occur with items that have inherent value. An example of a store of value is currency, which can be exchanged for goods and services. If the value of currency becomes unpredictable, such as in times of hyperinflation, investors and consumers will shift to alternative stores of value, such as gold, silver, precious stones and real estate.

overhead ratio

Operating expenses divided by the sum of taxable equivalent net interest income and other operating income. This ratio shows the proportion of expenses, in relation to total income, that cannot be allocated directly to production of the good or service. Operating expenses include items such as office rent, maintenance of machinery, depreciation costs, etc. In general, companies want to minimize these costs since it is difficult to quantify the revenues generated by undertaking these costs.

broad money

One measure of the money supply that includes M1, plus savings and small time deposits, overnight repos at commercial banks, and non-institutional money market accounts. This is a key economic indicator used to forecast inflation, since it is not as narrow as M1 and still relatively easy to track. All the components of M2 are very liquid, and the non-cash components can be converted into cash very easily.

ISM manufacturing index

A monthly index released by the Institute of Supply Management which tracks the amount of manufacturing activity that occurred in the previous month. This data is considered a very important and trusted economic measure. If the index has a value below 50, due to a decrease in activity, it tends to indicate an economic recession, especially if the trend continues over several months. A value substantially above 50 likely indicates a time of economic growth. The values for the index can be between 0 and 100.

open-ended investment company

OEIC. A type of company that allows investors to collectively pool together money to invest in various opportunities. As money is invested, shares are created. When a shareholder requests to sell shares, that money is then redeemed. The value of a share varies with the value of the OEIC's net portfolio value (NPV). It is most often used in the United Kingdom. In the United States it is referred to as an open-ended mutual fund.

Coverdell Education Savings Account

ESA. An investment vehicle designed to help parents fund their child's education. The Coverdell Education Savings Account has replaced the Education IRA. Contributions to the account are taxed, but earnings used to pay education expenses are not. The account is transferable among family members. However, there are several restrictions attached to this account. The entire account has to be disbursed before the beneficiary's 30th birthday, and any withdrawals after this date or for expenses that do not qualify under the act will be subject to income taxes and a penalty.

dutch disease

The deindustrialization of a nation's economy that occurs when the discovery of a natural resource raises the value of that nation's currency, making manufactured goods less competitive with other nations, increasing imports and decreasing exports. The term originated in Holland after the discovery of North Sea gas.

impairment charge

A specific reduction on a company's balance sheet that adjusts the value of a company's goodwill. Due to accounting rules, a company must monitor and test the value of its goodwill, to determine if it is overvalued. If it is, the company must issue an impairment charge on its balance sheet, to take into account the reduced value of the goodwill.

previous balance method

A technique for calculating finance charges on a credit card account that takes the outstanding balance at the end of the previous billing period and applies the interest rate to that total. Charges in the current billing period are not included. Interest charges are usually higher under this method than under other methods, such as adjusted balance, and average daily balance methods.

net income multiplier

The price of an asset (usually current price) divided by the net income it generates in a given period of time. Usually refers to rental property, for which the time period over which this multiple is considered is generally a month. It is a useful measure for judging how effective an asset is at generating income, compared to its market price.

media buy

The buying of advertising space from a company operating media properties. The cost of a media buy varies depending on the specific media property on which the buyer wants to advertise, the size of the advertising campaign, the specific times at which the advertisements are to be displayed, and other specific features of the advertising campaign.

net interest income

NII. A financial measure for banks, calculated by the amount of money the bank receives from interest on assets (commercial loans, personal mortgages, etc) minus the amount of money the bank pays out for interest on liabilities (personal bank accounts, etc). Although usually calculated for banks, this figure can also be calculated for other corporations, simply by subtracting the amount of interest paid on liabilities from the amount of interest earned from assets.

SIMPLE 401(k) Plan

A retirement plan sponsored by employers which is attractive for employers because it avoids some of the administrative fees and paperwork of plans such as a 401(k) plan. Employers benefit from the tax-deductible contributions made to the plan, and employees may elect to have salary deferrals in order to contribute to the plan. The employer has the option of matching a certain portion of the employee's deferrals or making non-elective contributions to all eligible employees (an annual limit applies in both cases). A minimum compensation eligibility requirement exists for employees who want to join this plan, and employees cannot establish any other qualified retirement plans at the same time.

currency trading

The act of buying and selling world currencies. Currency trading is most often engaged in by banks and other institutions, for the purposes of international trade. Individual investors may engage in currency trading as well, attempting to benefit from variations in the exchange rates of the currencies.

invest

To engage in any activity in which money is put at risk for the purpose of making a profit, and which is characterized by some or most of the following (in approximately descending order of importance): sufficient research has been conducted; the odds are favorable; the behavior is risk-averse; a systematic approach is being taken; emotions such as greed and fear play no role; the activity is ongoing and done as part of a long-term plan; the activity is not motivated solely by entertainment or compulsion; ownership of something tangible is involved; a net positive economic effect results.

normal distribution

A probability distribution shaped like a bell, often found in statistical samples. The distribution of the curve implies that for a large population of independent random numbers, the majority of the population often cluster near a central value, and the frequency of higher and lower values taper off smoothly.

extended broad money

One measure of the money supply that includes M2, plus large time deposits, repos of maturity greater than one day at commercial banks, and institutional money market accounts. also called M3.

margin lending

A program though lending institutions that allows an individual to borrow money for the purposes of investing it. The amount of credit loaned is based upon the amount of assets held by the borrower, which are pledged as collateral on the loan. This program is often used by individuals who want to invest more than they currently are investing, and are willing to take on the risk of this type of loan.

Open with joke, sorry for your lost.

weighted average maturity

WAM. The average maturity of all mortgages held in a mortgage-backed security. It is calculated by taking the value of each mortgage, dividing it by the total value of all mortgages (which finds the weight), and then multiplying that value by the number of years left on the mortgage. For example, a mortgage-backed security comprised of a $5000 note due in 2 years and a $2000 note due in 3 years has a weighted average maturity of ($5000/$7000)*2 + ($2000/$7000)*3, or 2.28. A high WAM means that the mortgages comprising the security will not mature for a long time.

automatic exercise

The procedure that prevents in-the-money equity options from expiring and becoming worthless. In this procedure, the clearing firm will exercise certain kinds of options that are in the money without instruction from the option holder, thus allowing option holders who may not be monitoring an option to still capture a profit. Not all options are subject to automatic exercise. Certain options (known as "capped-style options") become subject to automatic exercise if the price of the underlier hits a certain price (known as the "cap value"), regardless of when the price is achieved (this is only possible in the case of an American-style option). Other options will be subject to automatic exercise just before expiration and at no other time. In such cases, the trigger for automatic exercise is either when the option is in the money, or when it is in the money by a certain amount.

active account

A brokerage account in which there are many transactions. Often, brokerages will charge a certain flat fee on accounts that are not very active. For a brokerage, this is a chance to generate revenues from accounts that would otherwise not be generating revenues.

Form 10-Q

Unaudited document required by the SEC for all U.S. public companies, reporting the financial results for the quarter and noting any significant changes or events in the quarter. The Form 10-Q contains financial statements, a discussion from the management, and a list of "material events" that have occurred with the company (such as a stock split or acquisition). also called quarterly report.

contingent order

An order which is to be executed only if another order is executed first. An example of a contingent order would be to sell one specific security if another specific security has been bought. Brokers often do not like to work with these orders, given the uncertainty and extra work involved.

money market account

A savings account which shares some of the characteristics of a money market fund. Like other savings accounts, money market accounts are insured by the Federal government. Money market accounts offer many of the same services as checking accounts although transactions may be somewhat more limited. These accounts are usually managed by banks or brokerages, and can be a convenient place to store money that is to be used for upcoming investments or has been received from the sale of recent investments. They are very safe and highly liquid investments, but offer a lower interest rate than most other investments.

accumulation

Buying over a period of time. For example, this might be done by an institutional investor to avoid making a single substantial purchase that might drive up the market price, or by a retail investor who wants to reduce risk by dollar cost averaging.

Retaining profits within a company, as opposed to paying them out as dividends.

More generally, any buying.

back-to-back loans

An arrangement in which two companies in different countries borrow each other's currency for a given period of time, in order reduce foreign exchange risk for both of them. also called parallel loans.

direct quote

A foreign exchange rate of one currency, usually the domestic currency, per unit of a different currency. In terms of U.S. dollars, a direct quote is the number of a foreign currency that one dollar could buy. For example, a direct quote for the Euro could be US$1.50 = 1 Euro.

Federal Open Market Committee

FOMC. A 12-member committee which sets credit and interest rate policies for the Federal Reserve System. This committee consists of 7 members of the Board of Governors, and 5 of the 12 Federal Reserve Bank Presidents. This group, headed by the Chairman of the Federal Reserve Board, sets interest rates either directly (by changing the discount rate) or through the use of open market operations (by buying and selling government securities which affects the federal funds rate). The discount rate is the rate at which the Federal Reserve Bank charges member banks for overnight loans. The Fed actually controls this rate directly, but it tends to have little impact on the activities of banks because these funds are available elsewhere. This rate is set during the FOMC meetings by the regional banks and the Federal Reserve Board. The federal funds rate is the interest rate at which banks loan excess reserves to each other. While the Fed can't directly affect this rate, it effectively controls it through the way it buys and sells Treasuries to banks. There are 8 scheduled FOMC meetings during the course of each year. However, when circumstances dictate, the Fed can make inter-meeting rate changes.

production possibility frontier

PPF. A curve that compares the trade offs between two goods produced by an economy in order to demonstrate the efficient use of resources. Points along the curve are considered efficient and obtainable, and show the maximum amount of one good that can be produced in relation to another. Points within the curve are considered obtainable but inefficient. Points outside the curve are considered impossible to obtain. A classic example considers an economy that can produce either guns or butter, and shows how a government can spend a finite amount of resources on guns (defense), butter (non-defense) or a combination of the two.

quantity demanded

The amount of goods which would be demanded at a particular price. If non-price factors that could influence demand are removed, then the higher the price of a good the lower the quantity of that good will be demanded. It is the inverse of the law of supply, and is directly related to the law of demand.

basis swap

A specific type of interest rate swap, where the interest rates exchanged are based on different money markets or currencies.

corporate spread duration

The price sensitivity of a corporate bond to a 100 basis point change in its spread over LIBOR. Because a change in the option-adjusted spread affects the amount of cash flows received by the option holder. A corporate bond option investor maintaining a long position has to decide if the option should be executed because changes in the market price of the bond alters the return on the investment. For example, if the spread between the corporate bond option and Treasuries narrows, the price of the bond may rise to the point at which the option issuer could initiate the call.

watermark

An image on paper currency designed to differentiate officially sanctioned bills from counterfeit bills.

market maker

A brokerage or bank that maintains a firm bid and ask price in a given security by standing ready, willing, and able to buy or sell at publicly quoted prices (called making a market). These firms display bid and offer prices for specific numbers of specific securities, and if these prices are met, they will immediately buy for or sell from their own accounts. Market makers are very important for maintaining liquidity and efficiency for the particular securities that they make markets in. At most firms, there is a strict separation of the market-making side and the brokerage side, since otherwise there might be an incentive for brokers to recommend securities simply because the firm makes a market in that security.

circular flow of income

A model that indicates how money moves throughout an economy, between businesses and individuals. Investors spend their income by consuming goods and services from businesses, paying taxes and investing in the stock market. Businesses use the money spent by individuals while consuming and the money raised from selling stock to pay for capital to run their business, purchase material to manufacture products and to pay employees. All expenditures from individuals become the income of the businesses, and the expenditures of the businesses become the income of the individuals.

U.S. Treasury Securities

Negotiable U.S. Government debt obligations, backed by its full faith and credit. Exempt from state and local taxes. U.S. Treasury Securities are issued by the U.S. government in order to pay for government projects. The money paid out for a Treasury bond is essentially a loan to the government. As with any loan, repayment of principal is accompanied by a specified interest rate. These bonds are guaranteed by the "full faith and credit" of the U.S. government, meaning that they are extremely low risk (since the government can simply print money to pay back the loan). Additionally, interest earned on U.S. Treasury Securities is exempt from state and local taxes. Federal taxes, however, are still due on the earned interest. The government sells U.S. Treasury Securities by auction in the primary market, but they are marketable securities and therefore can be purchased through a broker in the very active secondary market. A broker will charge a fee for such a transaction, but the government charges no fee to participate in auctions. Prices on the secondary market and at auction are determined by interest rates. U.S. Treasury Securities issued today are not callable, so they will continue to accrue interest until the maturity date. One possible downside to U.S. Treasury Securities is that if interest rates increase during the term of the bond, the money invested will be earning less interest than it could earn elsewhere. Accordingly, the resale value of the bond will decrease as well. Because there is almost no risk of default by the government, the return on Treasury bonds is relatively low, and a high inflation rate can erase most of the gains by reducing the value of the principal and interest payments. There are three types of securities issued by the U.S. Treasury (bonds, bills, and notes), which are distinguished by the amount of time from the initial sale of the bond to maturity. also called Treasuries.

analyst

An employee of a bank, brokerage, advisor, or mutual fund who studies companies and makes buy and sell recommendations, often specializing in a single sector or industry. Analysts use a wide variety of techniques for researching and making recommendations. The reports and recommendations they publish are often used by traders, mutual fund managers, portfolio managers and investors in their decision making processes. also called financial analyst or securities analyst.

short call option

A stock option strategy in which an investor sells a call on shares that are either currently owned (covered call) or not yet owned (naked call). The two types of short calls carry different risks. For a naked call, the breakeven point is the premium received plus the strike price. For a covered call, the breakeven point is the strike price minus the premium.

affordability index

A measure of the financial ability of U.S. families to buy a house. 100 means that families earning the national median income have just the amount of money needed to qualify for a mortgage on a median-priced home; higher than 100 means they have more than enough and lower than 100 means they have less than enough.

market breadth

The fraction of the overall market that is participating in the market's up or down move. Looking at this parameter allows investors to reduce the impact of the large cap stocks which influence market indices the most, and instead examine price trends of a diverse range of stocks. This parameter is important in the context of technical analysis, as a measure of market sentiment. Market breadth is also used to refer to the number of independently issued price forecasts for a certain number of stocks (less common). also called breadth.

give up

A term used to describe a transaction between three brokers where one does not use his/her name. For example, Broker 1 receives a buy order that he/she is too busy to handle. Broker 1 asks Broker 2 to handle the order. Broker 2 buys the stock from Broker 3 on behalf of Broker 1's client. The transaction will be recorded as if Broker 1 was never involved (he/she has "given it up"), even though the initial order was placed with him/her.

double auction market

A system in which buyers enter competitive bidders and sellers enter competitive offers simultaneously, as opposed to the over-the-counter market, where trades are negotiated. Examples are the NYSE and the AMEX. A double auction market can also be carried out by open outcry, in which buyers and sellers call out prices that they are willing to buy and sell at, and a match is made if a buyer and seller call out the same price. Double auction markets usually feature a large number of buyers and sellers, and thus participants tend to incur lower transaction costs than in the over-the-counter market. also called auction market.

withholding

An amount of an employee's income that an employer sends directly to the federal, state, or local tax authority as partial payment of that individual's tax liability for the year. When a person starts a new job, he/she is required to fill out a W-4 form on which he/she can indicate his/her filing status and the number of allowances he/she is claiming.

inflation risk

The possibility that the value of assets or income will decrease as inflation shrinks the purchasing power of a currency. Inflation causes money to decrease in value at some rate, and does so whether the money is invested or not.

cashless exercise

A method of converting options into stock that requires no initial cash payment to cover the strike price. Essentially, a broker briefly loans enough money to exercise the options, and a portion of the stock is sold immediately after exercise in order to repay the broker. In this respect it is essentially buying on margin. The broker is willing to enter this arrangement when that broker feels that the option holder will honor his/her commitment and quickly sell his/her stocks to settle the debt to the broker.

covered arbitrage

Arbitrage involving investments denominated in different currencies, using forward cover to reduce or eliminate currency risk.

HI guy! Watch your mouth! (说话小心点) try me! 不信让我试试

Freaking, maybe you won’t like my answer! (反问句),

So be it! 但愿如此,那好吧, 看着办吧。Annoit, same here. I am not wonder.

--I want to start from a little dinner.

--how do you want to finish it?

--Simultaneously! (climax)

Missionary position, motto, nature-culture,

99-nighty-night

“boot call”: condom call, casual sex, booty

Leave him alone. That is so hard? 也没那么难吧。

voluntary liquidation

A liquidation that is supported by a company's shareholders, as opposed to an involuntary liquidation forced by Chapter 7 bankruptcy. A voluntary liquidation can occur in two situations. One is a members' voluntary liquidation when the directors of a solvent company decide to liquidate the company (with shareholder approval), and declare that they will be able to fulfill all creditor obligations in 12 months. The other situation is a creditors' voluntary liquidation, when the directors approach an insolvency professional for assistance in liquidation since they will not be able to fulfill creditors' obligations.

covered arbitrage

Arbitrage involving investments denominated in different currencies, using forward cover to reduce or eliminate currency risk.

broad-base index

An index whose purpose is to reveal the performance of the entire market, such as the S&P 500, Wilshire 5000, AMEX Major Market Index or Value Line Composite Index. Different broad-base indices have different approaches to ensuring that the index captures the entire breadth of market activity. The Wilshire 5000 takes the most all-inclusive approach by including all the stocks listed on the New York Stock Exchange and almost all the stocks listed on the NASDAQ and American Stock Exchange. The S&P 500 includes 500 companies that are together considered a good indicator for the US stock market, based on the industries the companies operate in, their positions within the industry, and their market capitalizations. The S&P 500 is a market-weighted index, so only 10% if its components make up about 75% of its value. The Value Line Composite Index takes an in between approach by tracking 1700 issues. The Value Line Composite is thought to be a better indicator of speculative stocks than of more stable stocks.

effective duration

The duration for a bond with an embedded option when the value is calculated to include the expected change in cash flow caused by the option as interest rates change. This measures the responsiveness of a bond's price to interest rate changes, and illustrates the fact that the embedded option will also affect the bond's price.

exotic option

A category of options which includes complicated components and complex payoffs. Its payoff or other key values often depend on outside factors which vary over time, such as exchange rate. Because of their complexity, exotic options are often traded over the counter rather than through an exchange. Asian-style options are one type of exotic options. opposite of plain vanilla option.

National Association of Securities Dealers

NASD. Merged with the NYSE Regulation, Inc. in 2007 to form the organization now known as the Financial Industry Regulatory Authority (FINRA).

VWAP

Volume Weighted Average Price. A measure of the price at which the majority of a given day's trading in a given security took place. Calculated by taking the weighted average of the prices of each trade. The method is used by institutional traders, who often break a given trade into multiple transactions.

Depository Trust Company

A central repository through which members electronically transfer stock and bond certificates (a clearinghouse facility). The Depository Trust Company was set up to provide an infrastructure for settling trades in municipal, mortgage-backed and corporate securities in a cost-efficient and timely manner. It is also the world's largest securities depository, holding about $20 trillion of assets in custody at any time. It is a member of the Federal Reserve system, registered with the Securities and Exchange Commission (SEC) and owned by the Depository Trust and Clearing Corporation (DTCC). The DTCC in turn is owned by several banks, brokerages, trading houses and trading exchanges.

above par

Having a current price above face value. This would generally be the case if the coupon paid on the bond exceeds the discount rate applicable, or if market interest rates fall after the bond is bought. If the bondholder had bought at a price above par, then he/she will suffer a capital loss upon maturity since the bond will only be redeemed at face value.

book to market ratio

A stock's book value divided by its market value. Book value is calculated from the company's balance sheet, while market value is based on the price of its stock. A ratio above 1 indicates a potentially undervalued stock, while a ratio below 1 indicates a potentially overvalued stock. Technology companies and other companies in industries which do not have a lot of physical assets tend to have low book to market ratios.

currency carry trade

An exchange of currencies, where an investor will exchange a specific amount of one currency for another currency which can be invested at a higher interest rate. The investor will then invest the new currency in a risk-free security, such as a bond, in hopes of earning more interest over time than could have been earned through investing the original currency. As long as the exchange rates stay the same, the investor will be earning money, but if the value of the original currency rose, the investor could lose money from this situation.

credit bureau

An agency which collects and sells information about the creditworthiness of individuals. A credit reporting agency does not make any decisions about whether a specific person should be extended credit or not. However, it does collect information that it considers relevant to a person's credit habits and history, and uses this information to assign a credit score to indicate how creditworthy a person is. When a prospective creditor approaches a credit reporting agency to inquire about a particular person, they are sold a credit report which contains all the information relevant to the person and the credit score calculated by the agency (some creditors might have an ongoing subscription to credit bureau). The prospective creditor then uses that information to decide whether to extend the applicant the desired credit or not. Same as credit bureau. also called consumer reporting agency.

OTC

Over-the-Counter. A security which is not traded on an exchange, usually due to an inability to meet listing requirements. For such securities, broker/dealers negotiate directly with one another over computer networks and by phone, and their activities are monitored by the NASD. OTC stocks are usually very risky since they are the stocks that are not considered large or stable enough to trade on a major exchange. They also tend to trade infrequently, making the bid-ask spread larger. Also, research about these stocks is more difficult to obtain. also called unlisted.

value fund

A mutual fund that invests in companies which it determines to be underpriced by fundamental measures. Assuming that a company's share price will not remain undervalued indefinitely, the fund looks to make money by buying before the expected upturn. Value funds tend to focus on safety rather than growth, and often choose investments providing dividends as well as capital appreciation. They invest in companies that have low P/E ratios, and stocks that have fallen out of favor with mainstream investors, either due to changing investor preferences, a poor quarterly earnings report, or hard times in a particular industry. Value stocks are often mature companies that have stopped growing and that use their earnings to pay dividends. Thus value funds produce current income (from the dividends) as well as long-term growth (from capital appreciation once the stocks become popular again). They tend to have more conservative and less volatile returns than growth funds.

forex deal

A contract between a currency trader and a market maker that indicates the currencies being bought and sold, the amount of currency involved, and the exchange rate that the two currencies will be traded at.

aggressive growth fund

A mutual fund which aims for the highest capital gains and is not risk-averse in its selection of investments. Aggressive growth funds are most suitable for investors willing to accept a high risk-return trade-off, since many of the companies which demonstrate high growth potential can also show a lot of share price volatility. Aggressive growth funds tend to have a very large positive correlation with the stock market, and so they often produce very good results during economic upswings and very bad results during economic downturns. An aggressive growth fund might, for example, buy initial public offerings (IPOs) of stock from small companies and then resell that stock very quickly in order to generate big profits. Some aggressive growth funds may even invest in derivatives, such as options, in order to increase their gains.

aggressive growth fund

A mutual fund which aims for the highest capital gains and is not risk-averse in its selection of investments. Aggressive growth funds are most suitable for investors willing to accept a high risk-return trade-off, since many of the companies which demonstrate high growth potential can also show a lot of share price volatility. Aggressive growth funds tend to have a very large positive correlation with the stock market, and so they often produce very good results during economic upswings and very bad results during economic downturns. An aggressive growth fund might, for example, buy initial public offerings (IPOs) of stock from small companies and then resell that stock very quickly in order to generate big profits. Some aggressive growth funds may even invest in derivatives, such as options, in order to increase their gains.

counterparty risk

The risk that the other party in an agreement will default. In an option contract, the risk to the option buyer that the writer will not buy or sell the underlying as agreed. In general, counterparty risk can be reduced by having an organization with extremely good credit act as an intermediary between the two parties.

annual report

Audited document required by the SEC and sent to a public company's or mutual fund's shareholders at the end of each fiscal year, reporting the financial results for the year (including the balance sheet, income statement, cash flow statement and description of company operations) and commenting on the outlook for the future. The term sometimes refers to the glossy, colorful brochure and sometimes to Form 10-K, which is sent along with the brochure and contains more detailed financial information. All 10-Ks for public companies and mutual funds incorporated in the U.S. are available on the SEC's website for free.

earnings multiple

The most common measure of how expensive a stock is. The earnings multiple is equal to a stock's market capitalization divided by its after-tax earnings over a 12-month period, usually the trailing period but occasionally the current or forward period. The value is the same whether the calculation is done for the whole company or on a per-share basis. The higher the earnings multiple, the more the market is willing to pay for each dollar of annual earnings. The last year's earnings multiple would be actual, while current year and forward year earnings multiple would be estimates, but in each case, the "P" in the equation is the current price. Companies that are not currently profitable (that is, ones which have negative earnings) don't have a earnings multiple at all. also called price/earnings ratio (P/E ratio).

account statement

A record of transactions and their effect on account balances over a specified period of time, for a given account. A bank account statement lists the debits and credits that took place over the relevant time period, while a brokerage account statement lists the long positions and short positions, purchases and sales, and other transactions.

currency basket

A group of securities whose weighted average is used to determine the value of an obligation or the value of another currency. For instance, a country that does not peg the value of its currency to a single other currency, such as the U.S. dollar, could value its currency to the value of a currency basket comprised of Euros, U.S. dollars, and Japanese Yen.

conduit IRA

A separate IRA established pursuant to a rollover from a qualified retirement plan. No intermingling of other funds such as regular (non-rollover) IRA contributions is permitted. Money in a conduit IRA may be rolled into a new employer's plan (if allowed), thereby preserving any favorable tax treatment associated with the distribution. There is no limit on the contributions transferred to a conduit IRA.

daily trading limit

The highest and lowest prices that a commodity or option is permitted to reach in a given trading session. Once reached, no trading occurs on that commodity or option until the following session. also called fluctuation limit or price limit.

bonus share

Free shares of stock given to current shareholders, based upon the number of shares that a shareholder owns. While this stock action increases the number of shares owned, it does not increase the total value. This is due to the fact that since the total number of shares increases, the ratio of number of shares held to number of shares outstanding remains constant.

information asymmetry

Condition in which at least some relevant information is known to some but not all parties involved. Information asymmetry causes markets to become inefficient, since all the market participants do not have access to the information they need for their decision making processes. opposite of information symmetry

bear spread

An option strategy designed to profit from a drop in a security's price, by selling a near-month futures contract and buying a deferred month futures contract.

foreign position

The amount of foreign debts and liabilities held by an investor, financial institution or country.

An agreement in currency trading in which one party agrees to purchase or sell securities to or from another party.

foreign position

The amount of foreign debts and liabilities held by an investor, financial institution or country.

An agreement in currency trading in which one party agrees to purchase or sell securities to or from another party.

Series EE bond

A Savings Bond issued at a discount from par par with a fixed rate of interest, set at the time of purchase. All interest on the bonds is calculated semi-annually, but paid at maturity and exempt from state and local taxes. The federal tax incurred on the interest can be paid annually or deferred. Over the first six months to five years that such a bond is held, it earns interest at 85% of the average yield on six-month Treasury Bills. After five years, it earns 85% of the average yield on five-year Treasury notes. There is no secondary market for such bonds, but they can be redeemed before maturity. At maturity, the bond will automatically enter extended maturity and earn interest according to rates at the beginning of that period. EE bonds will continue to earn interest for 30 years after they are purchased. Once they have reached maturity, EE bonds may be exchanged for Series HH bonds in order to continue to earn interest and further defer federal taxes. An individual can purchase up to $30,000 face value in savings bonds in one year.

top-down

An investment strategy which first finds the best sectors or industries to invest in, and then searches for the best companies within those sectors or industries. This investing strategy begins with a look at the overall economic picture and then narrows it down to sectors, industries and companies that are expected to perform well. Analysis of the fundamentals of a given security is the final step.

fiat money

Money which has no intrinsic value and cannot be redeemed for specie or any commodity, but is made legal tender through government decree. All modern paper currencies are fiat money, as are most modern coins. The value of fiat money depends on the strength of the issuing country's economy. Inflation results when a government issues too much fiat money.

redeemable

Able to be redeemed prior to maturity. The term usually applies to bonds and convertible securities. The issuer of a callable security has to state the conditions under which the security may be called at the time of issue. For most securities, there is a certain initial time period in which the security cannot be called. A bond will usually be called when market interest rates fall below the yield being paid on the bond (bonds are usually called when the price rises to a certain point). To reflect this risk, a callable security is usually priced lower than a non-callable security. also called callable.

break-even point

The price at which an option's cost is equal to the proceeds acquired by exercising the option. For a call option, it is the strike price plus the premium paid. For a put option, it is the strike price minus the premium paid.

The price at which a securities transaction produces neither a gain nor a loss.

The volume of sales at which a company's net sales just equals its costs.

general account

A margin account provided to a customer by a brokerage, in Federal Reserve Board terminology. Regulation T requires that all transactions involving credit given to the customer must be made in a general account.

investment fund

Firm that invests the pooled funds of retail investors for a fee. By aggregating the funds of a large number of small investors into a specific investments (in line with the objectives of the investors), an investment company gives individual investors access to a wider range of securities than the investors themselves would have been able to access. Also, individual investors are not hampered by high trading costs since the investment company is able to gain economies of scale in operations. There are two types of investment companies: open-end (mutual funds) and closed-end (investment trusts). also called investment fund.

down volume

When a stock closes in negative territory on the day, the volume in that stock is considered down volume. Technical analysts often compare down volume to up volume to look for buy and sell signals.

extended broad money

One measure of the money supply that includes M2, plus large time deposits, repos of maturity greater than one day at commercial banks, and institutional money market accounts. also called M3.

retail sales index

A monthly measurement of all goods sold by retailers based on a sampling of retail stores of different types and sizes. The retail sales index is often taken as an indicator of consumer confidence. Released at 8:30 am EST around the 12th of each month, the report reflects data from the previous month. This report is the "advance" report, which can be revised fairly significantly after the final numbers are calculated. Many analysts choose to look at the figures "ex-auto", which means excluding the volatile car sales figure. It is thought that this number is a better measure of across-the-board purchasing trends. The report does not include money spent on services, so it represents less than half of total consumption during the month. However, even with these limitations, the figures are closely watched as an indicator of the health of the economy.

forward cover taking

Buying a forward contract in order to hedge against exchange rate variability.

financial health

A description of the state of a person or company's finances. Someone with good financial health usually deals well with their finances, makes their payments on time, and knows how to manage their money. Someone in poor financial health usually owes a lot of money and isn't making their payments on time.

fixed-rate loan

A loan in which the interest rate does not change during the entire term of the loan. For an individual taking out a loan when rates are low, the fixed rate loan would allow him or her to "lock in" the low rates and not be concerned with fluctuations. On the other hand, if interest rates were historically high at the time of the loan, he or she would benefit from a floating rate loan, because as the prime rate fell to historically normal levels, the rate on the loan would decrease. opposite of adjustable rate.

private equity fund

A fund which invests its money in private equity, often in attempts to gain control over companies in order to restructure the company. When the fund gains control of a company, they will usually take the company off the market if it isn't private already, go through a multi-year restructuring process, and then relist the company on the stock market.

prime broker

A broker which acts as settlement agent, provides custody for assets, provides financing for leverage, and prepares daily account statements for its clients, who are money managers, hedge funds, market makers, arbitrageurs, specialists and other professional investors.

10-K

A report similar to the annual report, except that it contains more detailed information about the company's business, finances, and management. It also includes the bylaws of the company, other legal documents, and information about any lawsuits in which the company is involved. All publicly tradecompanies are required to file a 10-K report each year to the SEC.

primary instrument

A financial instrument whose value is not derived from that of another instrument, but instead is determined directly by the market.

prepaid expense

An accounting term signifying money paid for goods or services upfront. A prepaid expense is considered an asset on the balance sheet. As the goods and services are delivered they are recorded on the income statement. An example of a prepaid expense is insurance, since the policy holder pays money upfront to cover the risk of possible damaging event occurring in the future.

discretionary account

An account for which the holder gives his/her broker or someone else the authority to buy and sell securities, either absolutely or subject to certain restrictions. also called controlled account or managed account.

medium of exchange

Any item that is widely accepted in exchange for the goods and services offered to consumers in a given market. One example of a medium of exchange is currency.

foreign currency option

An option which gives the owner the right to buy or sell the indicated amount of foreign currency at a specified price before a specific date.

Treynor Index

A measure of a portfolio's excess return per unit of risk, equal to the portfolio's rate of return minus the risk-free rate of return, divided by the portfolio's beta. This is a similar ratio to the Sharpe ratio, except that the portfolio's beta is considered the measure of risk as opposed to the variance of portfolio returns. This is useful for assessing the excess return from each unit of systematic risk, enabling investors to evaluate how structuring the portfolio to different levels of systematic risk will affect returns.

commodity pool

An enterprise in which several individuals contribute funds in order to trade futures or futures options collectively. Commodity pools are analogous to mutual funds in that many investors pool their assets to gain the power to make trades that they could not make individually. Additional benefits include bypassing margin requirements and limiting risk to the amount invested in the pool.

repatriation

Capital flow from a foreign country to the country of origin. This usually refers to returning returns on a foreign investment in the case of a corporation, or transferring foreign earnings home in the case of an individual.

bull market

A prolonged period in which investment prices rise faster than their historical average. Bull markets can happen as a result of an economic recovery, an economic boom, or investor psychology. The longest and most famous bull market is the one that began in the early 1990s in which the U.S. equity markets grew at their fastest pace ever. opposite of bear market.

currency swap

An arrangement in which two parties exchange specific amounts of different currencies initially, and a series of interest payments on the initial cash flows are exchanged. Often, one party will pay a fixed interest rate, while another will pay a floating exchange rate (though there may also be fixed-fixed and floating-floating arrangements). At the maturity of the swap, the principal amounts are exchanged back. Unlike an interest rate swap, the principal and interest are both exchanged in full in a currency swap.

Education IRA

The name for a tax-deferred investment vehicle, set up on or after January 1, 1998, which has now been replaced by the Coverdell Education Savings Account. Such an account may contain funds to be applied to future education-related expenses. The name is misleading, as an Education IRA is not actually an IRA and is not related to retirement in any way. Contributions are not tax-deductible but all deposits and earnings can be withdrawn without additional penalties or taxes.

shareholder of record

The name of an individual or entity that an issuer carries in its records as the registered holder (not necessarily the beneficial owner) of the issuer's securities. Dividends and other distributions are paid only to shareholders of record. also called stockholder of record or holder of record or owner of record.

exchange rate risk

The risk that a business' operations or an investment's value will be affected by changes in exchange rates. For example, if money must be converted into a different currency to make a certain investment, changes in the value of the currency relative to the American dollar will affect the total loss or gain on the investment when the money is converted back. This risk usually affects businesses, but it can also affect individual investors who make international investments. also called currency risk.

financial planner

An investment professional who helps individuals set and achieve their long-term financial goals, through investments, tax planning, asset allocation, risk management, retirement planning, and estate planning. The role of a financial planner is to find ways to increase the client's net worth and help the client accomplish all of his/her financial objectives.

out of the money

A call option whose strike price is higher than the market price of the underlying security, or a put option whose strike price is lower than the market price of the underlying security.

economic exposure

The risks faced by a company that does business or holds investments abroad. Economic exposure can include changes in foreign exchange rates or the chance of foreign countries defaulting on their debt. Companies often hedge against this type of risk through the foreign exchange market.

debt service coverage ratio

DSCR. A measurement of a property's ability to generate enough revenue to cover the cost of its mortgage payments. It is calculated by dividing the net operating income by the total debt service. For example, a property with a net operating income of $50,000 and a total debt service of $40,000 would have a debt service ratio of 1.25, meaning that it generates 25% more revenue than required to cover its debt payment.

ESOP

Employee Stock Ownership Plan. A trust established by a corporate which acts as a tax-qualified, defined-contribution retirement plan by making the corporation's employees partial owners. contributions are made by the sponsoring employer, and can grow tax-deferred, just as with an IRA or 401(k). But unlike other retirement plans, the contributions must be invested in the company's stock. The benefits for the company include increased cash flow, tax savings, and increased productivity from highly motivated workers. The main benefit for the employees is the ability to share in the company's success. Due to the tax benefits, the administration of ESOPs is regulated, and numerous restrictions apply. also called stock purchase plan.

yen carry trade

A specific example of a currency carry trade, where an investor will exchange a specific amount of Japanese Yen for another currency with a higher interest rate, and then will invest the new currency in hopes of earning more interest than could have been earned with the yen.

credit union

A non-profit financial institution that is owned and operated entirely by its members. Credit unions provide financial services for their members, including savings and lending. Large organizations and companies may organize credit unions for their members and employees, respectively. To join a credit union, a person must ordinarily belong to a participating organization, such as a college alumni association or labor union. When a person deposits money in a credit union, he/she becomes a member of the union because the deposit is considered partial ownership in the credit union.

bundling

The practice of joining related products together for the purpose of selling them as a single unit. This is generally carried out when the seller thinks that the characteristics of two or more products and services are such that these products might appeal to many consumers more as a package than as individual offerings e.g. local and long distance services. Bundling arrangements usually feature a special pricing arrangements which make it cheaper to buy the products and services as a bundle than separately. Bundling is also often a way for creating a larger market for relatively low value products by selling them cheap (or giving them away free) with a higher value product e.g. giving away free floppy disks with the purchase of high-end computer software. The floppies might be an incentive to buy that particular software, and quite possibly the software price has a slight mark-up in it to cover the cost of the floppies.

on a case by case basis 视情况而定, as appropriate, just depends

Seems the attachment is not coming with the email though. Turd: shit

self-explanatory, real estate mogul, upfront,

Aileron is still very much an early-stage developer, with plans to get into the clinic once it gets a green light from the FDA. Stapled peptides. Upbeat, positive, optimistical,

Toast: here is to coatch! Anytime, anywhere! (随时奉陪)

Give me a ring, give me a call, call me, write to me, text me, drop me a line (drop a line写封短信)
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