Individual in a brokerage firm, bank trust department, or mutual fund group who researches corporations, industry groups and the market to make buy and sell recommendations on specific securities. A majority of analysts specialize in a particular industry. However, some analyze corporations that interest them, regardless of its industry group.
See: Fundamentalist; Research Department; Technical Analyst
A stockholder meeting that is held yearly. Functions of an annual meeting are for corporate executives to report on the year's results, to elect the board of directors, and to transact other business. The chief executive officer customarily makes a statement on the outlook for the next year and conducts a question and answer period. If a shareholder is unable to attend the annual meeting, the owner may vote for directors and pass on resolutions through the use of a proxy. Proxy materials are mailed to all shareholders of record.
A yearly statement of a corporation's financial condition that describes its operations and provides its balance sheet and income statement. In addition, other information that shareholders will be interested in will be furnished.
See: Balance Sheet; Income Statement
On a 360-day basis, it is the percentage of discount from par value that US Treasury Bills trade in the securities market at a particular moment in time.
See: Par; Treasury Bill
An investor who is receiving annuity payments.
The series of payments from the capital that has built up in an annuity. The payments may be a fixed amount, or for a fixed period of time, or for the lifetimes of one or two annuitants.
See: Annuitant; Annuity; Deferred Annuity; Fixed Annuity; Immediate Payment Annuity; Variable Annuity
A contract between a life insurance company and an individual that guarantees income for a defined period, usually starting at retirement, to the person on whose life the contract is based. In exchange, the individual agrees to make periodic payment to the insurance company. All capital in the annuity grows tax-deferred.
See: Annuity Unit; Fixed Annuity; Variable Annuity
An accounting procedure used to calculate the amount of each payment an annuitant should receive during the payout period.
AON (All Or None) Offering
All or none offerings give an issuer the right to cancel an entire issue if an underwriting is not completely subscribed. A corporation may select this type of offering because it may be uneconomical to complete the distribution unless the entire amount of capital needed can be financed. No purchases can be finalized until it is determined that the entire offering is sold.
See: Underwrite; Underwriter
AON (All Or None) Order
A type of order where the client wants the entire order executed or none of it. The purchase (or sale) order must be greater than one round lot (100 shares). An AON order can be either a "day" order or a "good til canceled" order.
sambadirect on-line rules require an AON order to be a minimum of 100 shares for securities and a minimum of 2 contracts for options orders.
See: Day Order; Fill Or Kill Order; Good Til Canceled Order; Immediate Or Cancel Order; Orders
Appreciation is an asset's increase in value.
See: Asset; Depreciation
A list of investments that a mutual fund or other financial institution is allowed to invest in. When fiduciary responsibility exists, the use of an approved list may be statutory.
See: Legal List
This is the practice of simultaneously buying and selling the same (or equivalent securities) to profit from the disparity in their prevailing prices in separate markets. This activity applies to equivalent securities trading in different markets, securities with convertible features, or securities involved in mergers, tender offers, recapitalizations, or corporate divestitures.
A method of settling disputes between brokers and their clients, brokerage firms and clearing corporations, employees and their firms, and two brokerage firms. Arbitration has been adopted by all exchanges and securities associations. A pre-dispute arbitration clause in a customer's brokerage account agreement is customary and assures that disputes will be arbitrated by objective third parties and preclude court cases.
Past due obligations such as interest on bonds or dividends on cumulative preferred stocks. If a cumulative preferred stock's dividends are in arrears, common dividends cannot be paid.
See: Cumulative Preferred Stock
Articles Of Incorporation
Document filed with a US state by corporation founders. Once the state approves the articles, it will issue a certificate of incorporation. The articles and the certificate form the Corporate Charter and gives the corporation its legal existence. The charter provides such information as the corporation's name, purpose, amount of authorized shares, and the number and identity of directors.
See: Corporate Charter
A chart pattern that tracks a stock's price over a period of time. The pattern will show that each peak in the stock's price is higher than the preceding peak. This upward movement is considered bullish.
See: Descending Tops
ASE (American Stock Exchange)
The second largest stock exchange in the US is located in the financial district of New York City at 86 Trinity Place. As a general rule, the securities traded on the AMEX are those of small to mid-size corporations. The AMEX also trades options of many NYSE securities and some OTC securities.
See: New York Stock Exchange; Over The Counter
1: It is the lowest round lot price at which a dealer will sell a security or commodity on an exchange or in the over-the-counter market. In other words, it is the price that an investor can buy the security. Also called the "asking price", "ask", "offering price" or "offer".
2: The per-share price that mutual fund shares are offered to the potential investors. It is usually the "net asset value" per share plus any sales charges.
See: Net Asset Value; Offer
A dollar value that is given to property by a municipality for the purpose of assessing taxes. Assessed valuation is important to both homeowners and investors in municipal bonds that are backed by property tax.
See: Municipal Bond
Anything of value owned or is owed to it by a business, institution, or individual. Assets may include cash, investments, accounts receivable, product inventory and other current assets. Patents and goodwill are called intangible assets.
See: Capital Asset; Current Assets; Fixed Assets; Intangible Assets
The allotment of investment funds amongst various types of assets such as cash equivalents, stock, fixed-income investments, real estate, and precious metals. It also applies to sub-classifications such as industry groupings of common stocks and government, municipal, and corporate bonds. Asset allocation affects both risk and return.
See: Cash Equivalent; Common Stock; Fixed Income Investment
Securities underwritten by brokerage firms who sell them to investors. The securities (bonds or notes) are backed by loan paper or accounts receivable of the issuer.
See: Accounts Receivable
Extent to which a corporation's net assets cover a specific class of preferred stock, debt obligation or equity position. Asset coverage is significant as a buffer against losses in the event of liquidation.
See: Liquidation; Net Assets; Preferred Stock
Asset Management Account (AMA)
An account at a brokerage firm or a bank that combines checkwriting, debit cards (or credit cards) and brokerage services such as buying and selling securities. AMAs are convenient because all financial transactions are listed on one monthly statement. AMAs are also called central asset accounts and are known by proprietary names such as Cash Management Account (Merrill Lynch).
A security whose current price does not reflect the value of corporate assets. For instance, analysts may recommend a corporation because its real estate value is greater than is reflected in the stock's current price and not because the corporation is run well. Asset play securities are attractive targets for takeovers because they provide a low-cost way to buy assets.
See: Target Company
1: When an option is exercised, the Options Clearing Corporation prepares an assignment notification to a broker/dealer that one of its clients has options written that were exercised. The firm then assigns the exercise to one of its clients. This is done in accordance with their internal procedures.
See: Exercise; Options Clearing Corporation
2: It is the signing of either a stock/bond certificate or a separate form known as a stock power/bond power to authorize transfer of ownership to a new owner.
See: Good Delivery of Securities
After all shares have been sold by an issue's underwriters, a new issue is considered assimilated by investors.
Assumed Interest Rate
The growth rate built into an annuity table to calculate the payout on variable annuities.
See: Variable Annuity