Copy of `FINRA - Finance Terms`

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FINRA - Finance Terms Category: Economy and Finance > Finance Date & country: 24/09/2008, USA Words: 340

specialist
A member of a stock exchange through which all trades in a given security pass.

specific performance
The remedy of performance of a contract in the specific form in which it was made, according to the precise terms agreed upon.

split
The division of outstanding shares of a corporation into a larger number of shares. For example: in a 3-for-1 split, each holder of 100 shares before would have 300 shares, although the proportionate equity in the company would remain the same. A reverse split occurs when the company reduces the total number of outstanding shares, but each share is worth more.

sponsorship
Enhancing the demand for a stock through research and order flow.

spread
The difference between the bid price at which a Market Maker will buy a security, and the ask price at which a Market maker will sell a security. (See inside spread)

SRO
See self-regulatory organization

Standard & Poor's Corporation
A company well known for its rating of stocks and bonds according to investment risk (the Standard & Poor's Rating) and for compiling the Standard & Poor's Index—commonly called the Standard & Poor's 500—that tracks 400 industrial stocks, 20 transportation stocks, 40 financial stocks, and 40 public utilities as a measurement indicative of broad changes in the market.

stock
An instrument that signifies an ownership position in a corporation.

stock symbol
A unique four- or five-letter symbol assigned to a Nasdaq security that is used for identifying it on stock tickers, in newspapers, on on-line services, and in automated information retrieval systems. If a fifth letter appears, it identifies the issue as other than a single issue of common or capital stock.

stop-loss order
A customer order to a broker that sets the sell price of a stock below the current market price, therefore protecting profits that have already been made or preventing further losses if the stock drops. (See limit order)

street name
Term given to securities held in the name of a broker on behalf of a customer. This arrangement allows shares to be transferred easily. If the stock were registered in the customer's name rather than the broker's name, physical certificates would need to be transferred. (See beneficial owner)

subindex
Categories of the Nasdaq Composite Index. There are currently 11 subindexes: Bank, Biotechnology, Computer, Industrial, Insurance, Nasdaq ADR (American Depositary Receipts), Nasdaq Regional Indexes, Nasdaq-100® (100 of the largest companies on the Nasdaq National Market), Other Finance, Telecommunications. (See Nasdaq Composite Index)

suitability
A suitability violation occurs when and investment made by a broker is inconsistent with the investor's objectives, and the broker knows or should know the investment is inappropriate.

surveillance
See market regulation

syndicate
A group of investment banking firms formed to conduct an underwriting of a new security issue. (See underwriter)

syndicate manager
Also called the managing underwriter or manager, the syndicate manager works with a company to prepare a new stock issue and register it with the Securities and Exchange Commission. The manager often also organizes the syndicate to spread the risk of a new issue.

TARSSM
See Trade Acceptance and Reconciliation ServiceSM

third market
Over-the-counter trading of exchange-listed securities among institutional investors and broker/dealers for their own accounts (not as agents for buyers and sellers). Stock exchange members or non-members may trade large blocks of stock off the floor to avoid the transaction's unsettling effect on the market, or avoid paying a commission on the sale. (See dealer market, fourth market, institution...

Third Market Trade Reporting (TMTR)
Automated data collection and reporting system that continuously reports last-sale prices reflecting trades in the over-the-counter market.

third-party claim
A claim by the respondent against a party not already named in the proceeding.

TMTR
See Third Market Trade Reporting

trading halt
The suspension of trading in a Nasdaq security while material news from the issuer is being disseminated. A trading halt generally lasts 30 minutes and gives all investors equal opportunity to evaluate news and make buy, sell, or hold decisions on that basis. (See material news)

transfer agent
An agent who maintains records of stock and bond owners to cancel and issue certificates, and resolve problems arising from lost, destroyed, or stolen certificates. (See registrar)

transparent market
The degree to which trade and quotation information is available to the public on a current basis.

two-sided market
Requirement that Market Makers quote both a bid and ask price for each security in which they make a market and to execute orders at those prices.

unauthorized trading
The purchase, sale or trade of securities in an investor's account without the investor's prior authorization.

underwriter
An investment banker who assumes the risk of bringing a new securities issue to market. The underwriter will buy the issue from the issuer and guarantee sale of a certain number of shares to investors; this is firm-commitment underwriting. To spread the risk of purchasing the issue, the underwriter often will form a syndicate (underwriting group, purchase group) among other investment firms. If th...

underwriting spread
The difference between what an underwriter pays for a securities issue, and the price at which he offers it to the public. (See underwriter)

uniform submission agreement
Agreement signed by the parties indicating their submission to the arbitration process, and their agreement to be bound by the determination which may be rendered.

unit
A merger of two or more classes of securities into a single securities product.

UPC
Uniform Practice Code

uptick
A transaction executed at a price higher than the preceding transaction in that security

volatility
The degree of price fluctuation for a given asset, rate, or index. Usually expressed as a variance or standard deviation. (See beta)

volume
Amount of trading activity, expressed in shares or dollars, experienced by a single security or the entire market within a specified period, usually daily, monthly, or annually.

warrant
A certificate issued by a company giving the holder the right to purchase securities at a stipulated price within specific time limits or with no expiration date (perpetual warrant). A warrant is sometimes offered by a company as an inducement to buy.

when-issued trading
A short form of 'when, as, and if issued.' The term refers to a conditional security: one authorized for issuance but not yet actually issued. All 'when issued' transactions are on an 'if' basis, to be settled if and when the actual security is issued.

wire house
A firm whose branch offices are linked by a communications system that permits the rapid dissemination of prices, information, and research relating to financial markets and individual securities.

wrap fee
Charge for an investment program that bundles or 'wraps' a number of services (brokerage, advisory, research, consulting, management, etc.) together and covers them with a single fee based on the value of assets under management.

p/e ratio
See price/earnings ratio.

T+3
See settlement date