See: Asset; Going Concern Value; Goodwill

Intercommodity Spread
A spread that includes a long position and a short position in related commodities--for instance, a long position in silver futures and a short position in gold futures. The investor aims to profit from the changing price relationship between the commodities.

See: Commodities; Futures Contract; Long Position; Short Position; Spread

Interdelivery Spread
Technique used in trading options or futures. Contracts expiring in one month are bought and the same contracts expiring in a different month are sold--for example, buying a May cotton contract and simultaneously selling an August cotton contract. The investor aims to profit when the price between the two contracts narrows or widens.

See: Futures Contract; Options; Spread

Interest
Dollar cost that a borrower pays a lender for the use of the lender's money.

Interest Rate Options
Option contracts that are based upon underlying debt instruments.

See: Options; Debt Instrument

Interest Sensitive Stock
A corporation's stock whose earnings change when interest rates change. Upon news of rate increases or decreases, the stock will go up or down in price. Examples of interest-sensitive stocks include bank and utility companies.

Interim Dividend
A dividend that is declared and paid before annual earnings are determined. Most companies plan quarterly dividends they know they can afford.

See: Dividend

Interim Statement
A report that presents a corporation's income statement for the period and, sometimes the balance sheet. A corporation usually issues three interim reports (quarterly) and one annual report.

See: Annual Report; Balance Sheet; Financial Statement; Fundamental Analysis; Income Statement

Interlocking Directorate
An individual who is on the board of directors for more than one corporation.

See: Director

Intermarket Trading System (ITS)
An electronic communications network that links the posts of specialists who are market makers for the same securities at the floors of seven registered exchanges to foster competition among them. Quotes are displayed and are firm (good) for at least one round lot (100 shares). Through ITS, a broker at one exchange may direct an order to another exchange where the quote is better.

See: Firm Quote; Market Maker; Round Lot; Specialist

Intermediary
Individual or entity that is sanctioned to make investment decisions for others--also called "financial intermediary". An intermediary is used because they are investment specialists that usually can obtain higher returns than the average investor. Moreover, because they deal in large dollar volumes, they can easily diversify the assets. Examples of some intermediaries are brokerage firms, mutual funds, banks, and insurance companies.

See: Diversification; Intermediation

Intermediate Term
Time between short and long term with the length dependent on the context. A bond analyst, for instance, usually considers an intermediate term to be between 3 to 10 years. A stock analyst would consider it to mean 6 to 12 months.

See: Long Term; Long Term Debt; Short Term; Short Term Debt

Intermediation
Money deposited with financial intermediaries--such as brokerage firms, banks, insurance companies--which invest in stock, bonds, money market securities, government obligations and/or mortgages to obtain a targeted return. In contrast, disintermediation is the withdrawal of money from an intermediary.

See: Disintermediation; Intermediary

Internal Control
An organization's procedures that are designed to increase its efficiency, ensure its policies are implemented, and its assets are safeguarded.

Internal Expansion
Growth of an organization's assets through cash generated internally from either internal financing, appreciation or accretion.

Accretion; Appreciation; Asset; Internal Financing

Internal Financing
Funds generated through a corporation's normal business operations.

See: Internal Expansion

International Mutual Funds
A mutual fund that invests in nondomestic securities markets throughout the world. If investments are chosen carefully, this type of fund may be profitable when some markets are rising and others are declining. However, fund managers must watch foreign currencies as well as world markets--profitable investments in a rising market can lose money if the foreign currency rises against the dollar.

See: Hedging; Mutual Fund

Inter Vivos Trust
A trust established between two or more individuals that are alive--also called "living trust". The opposite is a testamentary trust, which is effective when the individual who established the trust dies.

See: Living Trust; Testamentary Trust

In The Money
Expression used for any option series with intrinsic value--the option's strike (exercise) price and market price of the underlying security are such that the holder can exercise the option at a profit. For example, if a call option with a strike price of 30 and the underlying stock's market price is currently 33, the call is in the money. A put option is considered in the money when the underlying stock is selling below the strike price. Premiums and other transaction costs are not considered in determining whether the option is in the money or out of the money.

See: Call Option; Exercise Price; Intrinsic Value; Options; Out Of The Money; Put Option; Strike Price; Time Value; Underlying Security

In The Tank
Lingo meaning that market prices are plummeting.

See: Bear Market

Intraday
Within the day. The term is often used when stating high and low prices of a security. When stating, for example, that a stock hit a new intraday low, it means that during the day the stock reached an all-time low price but rose back to a higher price by the end of the day.

See: Historical Trading Range; Technical Analysis

Intra-State Offering
A new securities' issue that will only be sold to investors in one state and who are residents of that state. An intra-state offering is exempt from filing provisions of the Securities Exchange Act of 1933 under Rule 147.

See: Initial Public Offering; New Issue; Securities Exchange Act of 1933

Intrinsic Value
The amount whereby an underlying security's current market price is above the call option's strike (exercise) price or below the put option's strike price. If the strike price of a call option, for example, is $40 and the stock is $43, the option's intrinsic value is $3. An option that has intrinsic value is "in the money." If the option is at or out of the money, it does not have an intrinsic value.