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Superglossary - Finance
Category: Economy and Finance > Finance
Date & country: 16/12/2013, US
Words: 5424

Back Taxes
Due taxes that have not been paid on time.

Back Up
(1) When bond yields rise and prices fall, the market is said to backup. (2) An investor who swaps o

Back Up The Truck
In the context of general equities, 'Prepare for a very large buyer.'

Back-End Load Fund
A mutual fund that charges investors a fee to sell (redeem) shares, often ranging from 4% to 6%. Som

Creating a hypothetical portfolio performance history by applying current asset selection criteria t

Back-To-Back Financing
An intercompany loan channeled through a bank.

Back-To-Back Loan
A loan in which two companies in separate countries borrow each other's currency for a specific time

In the context of mutual funds, a feature allowing fundholders to use an earlier date on a letter of

Backed In
In the context of general equities, to describe result of unanticipated events that allow for a purc

Backup Line
A commercial paper issuer's bank line of credit covering maturing notes if, for some reason, selling

A market condition in which futures prices are lower in the distant delivery months than in the near

Bad Debt
A debt that is written off and deemed uncollectible.

Bad Debt Expense
Losses for uncollectible accounts receivable.

Bad Delivery
Antithesis of good delivery.

Bad Title
Title to property that does not distinctly confer ownership, usually in the context of real estate.

Two-sided market picture, in Japanese terminology applies mainly to international equities.

Bailing Out
In the context of securities, refers to selling a security or commodity quickly, regardless of the p

Bailout Bond
A bond issued by the Resolution Funding Corporation (Refcorp) to save the failing savings and loan a

Baker Plan
A plan by former U.S. Treasury Secretary James Baker under which 15 principal middle-income debtor c

Balance Of Payments
A statistical compilation formulated by a sovereign nation of all economic transactions between resi

Balance Of Trade
Net flow of goods (exports minus imports) between two countries.

Balance Sheet
Also called the statement of financial condition, it is a summary of a company's assets, liabilities

Balance Sheet
A financial statement that lists the assets, liabilities, and equity of a company at a certain point

Balance Sheet Identity
Total assets = Total liabilities + Total stockholders' equity

Balanced Budget
A budget in which the income equals expenditure. See

Balanced Fund
An investment company that invests in stocks and bonds. The same as a balanced mutual fund.

Balanced Mutual Fund
This is a fund that buys common stock, preferred stock, and bonds. The same as a balanced fund.

Balloon Interest
In the context of serial bond issues, the elevated coupon rate on bonds with late maturities.

Balloon Maturity
Any large principal payment due at maturity for a bond or loan with or without a sinking fund requir

Bank Anticipation Notes (BAN)
Notes issued by states and municipalities to obtain interim financing for projects that will eventua

Bank Collection Float
The time that elapses between when a check is deposited into a bank account and when the funds are a

Bank Discount Basis
A convention used for quoting bids and offers for Treasury bills in terms of annualized yield, based

Bank Draft
A draft addressed to a bank.

Bank Holding Company
A company that owns or has controlling interest in two or more banks and/or other bank holding compa

Bank Insurance Fund (BIF)
A unit of the Federal Deposit Insurance Corporation (FDIC) that provides deposit insurance for banks

Bank Investment Contract (BIC)
Interest guaranteed by the bank in a portfolio over a specific time frame with a specific yield.

Bank Line
Line of credit that by a bank grants to a customer.

Bank Trust Department
Bank department that deals with estates, administers trusts, and provides services such as estate pl

Bank Wire
A computer message system linking major banks. It is used not for effecting payments, but as a mecha

Bankers Acceptance
A short-term credit investment created by a nonfinancial firm and guaranteed by a bank as to payment

An agreement between a company engaged in a takeover bid and a bank that the bank will not finance t

Inability to pay debts. In bankruptcy of a publicly owned entity, the ownership of the firm's assets

Bankruptcy Cost View
The argument that expected indirect and direct bankruptcy costs offset the other benefits from lever

Bankruptcy Risk
The risk that a firm will be unable to meet its debt obligations. Also referred to as default or ins

Bankruptcy View
The argument that expected bankruptcy costs preclude firms from financing entirely with debt.

Slang for one million dollars.

Barbell Strategy
A fixed income strategy in which the maturities of the securities included in the portfolio are conc

Barefoot Pilgrim
A slang term for an unsophisticated investor who has lost everything on the stock market.

Bargain Hunter
In the context of general equities, purchaser who is extremely selective in the price sought on a tr

Bargain-Purchase-Price Option
Gives the lessee the option to purchase the asset at a price below fair market value when the lease

Economic and market data that represent an overall trend. The Dow Jones Industrial Average is an exa

Barrier Options
Option contracts with trigger points that, when crossed, automatically generate buying or selling of

Barrons Confidence Index
Index measuring the ratio of the average yield on 10 top-grade bonds to the average yield on 10 inte

The trading/exchange of goods or services without using currency.

A technical analysis tool. A chart pattern depicting the period when the supply and demand of a cert

Base Currency
Applies mainly to international equities. Currency in which gains or losses from operating an intern

Base Interest Rate

Base Market Value
A group of securities, average market price at a specific time. Used for the purpose of indexing.

Base Period
A particular period of time used for comparative purposes when measuring economic data.

Base Probability Of Loss
The probability of not achieving a portfolio expected return. Related

Base Rate
British equivalent of the U.S. prime rate.

Basic Balance
In a balance of payments, the basic balance is the net balance of the combination of the current acc

Basic Business Strategies
Key strategies a firm intends to pursue in carrying out its business plan.

Basic IRR Rule
Accept the project if IRR is higher than the discount rate; reject the project if it is lower than t

The price an investor pays for a security plus any out-of-pocket expenses. It is used to determine c

Basis Point
In the bond market, the smallest measure used for quoting yields is a basis point. Each percentage p

Basis Price
Price expressed in terms of yield to maturity or annual rate of return.

Basis Risk
Uncertainty about the basis at the time a hedge may be lifted. Hedging substitutes basis risk for pr

Applies to derivative products. Group of stocks that is formed with the intention of either being bo

Basket Options
Packages that involve the exchange of more than two currencies against a base currency at expiration

Basket Trades

BD Form
An SEC required document of brokerage houses that outlines the firm's finances and officers.

An investor who believes a stock or the overall market will decline. A bear market is a prolonged pe

Bear CD
A bear CD pays the holder a fraction of any fall in a given market index.

Bear Hug
Often used in risk arbitrage. Hostile takeover attempt in which the acquirer offers an exceptionally

Bear Market
Any market in which prices exhibit a declining trend. For a prolonged period, usually falling by 20%

Bear Raid
In the context of general equities, attempt by investors to move the price of a stock opportunistica

Bear Spread
Applies to derivative products. Strategy in the options market designed to take advantage of a fall

Bear Trap
The predicament facing short sellers when a bear market reverses its trend and becomes bullish. The

Bearer Bond
Bonds that are not registered on the books of the issuer. Such bonds are held in physical form by th

Bearer Form
Describes issue form of security not registered on the issuing corporation's books, and therefore pa

Bearer Share
Security not registered on the books of the issuing corporation and thus payable to possessor of the

Words used to describe investor attitude.

Beating The Gun
In the context of general equities, gaining an advantageous price in a trade through a quick respons

Before-Tax Profit Margin
The ratio of net income before taxes to net sales.

An international trade policy of competitive devaluations and increased protective barriers that one

Beggar-Thy-Neighbor Devaluation
A devaluation that is designed to cheapen a nation's currency and thereby increase its exports at th

Used for listed equity securities. At the same price but entered after your order/interest, such as

Signal on a stock exchange to indicate the open and close of trading.

Bellwether Issues

Below Par
Less than the nominal or face value of a security.

The performance of a predetermined set of securities, used for comparison purposes. Such sets may be

Benchmark Error
Use of an inappropriate proxy for the true market portfolio.

Benchmark Interest Rate
Also called the base interest rate, it is the minimum interest rate investors will demand for invest

Benchmark Issue
Also called on-the-run or current-coupon issue or bellwether issues. In the secondary market, the be

Used for listed equity securities. 1) Behind; 2) Lower in price.

Beneficial Ownership
Often used in risk arbitrage. Person who enjoys the benefits of ownership even though title is in an

Term used to refer to the person who receives the benefits of a trust or the recipient of the procee

The total amount of indirect compensation that the business will provide to employees for each forec

Best-Efforts Sale
A method of securities distribution/underwriting in which the securities firm agrees to sell as much