|Custodial fees Fees
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Definition of Custodial fees Fees
Custodial fees Fees
charged by an institution that holds securities in safekeeping for an investor.
The portion of total fees in a syndicated credit that go to the participating banks.
The percent of a mutual fund's assets used to defray marketing and distribution expenses. The
fees paid when for example a financial instrument such as a loan is arranged.
A guaranteed investment contract where the policyholder is not guaranteed a crediting
Mutual funds that do not charge an upfront or back-end commission, but instead take out up to
A type of insurance policy or annuity in which the owner does not receive dividends.
A policy offers the potential of sharing in the success of an insurance company through the receipt of dividends.
a measure used in academic finance articles to measure the excess returns an investor would have received over a particular time period if he or she were invested in a particular stock.
present value of a perpetuity with growth.
Part of the return that is not due to systematic influences (market wide influences). In
A merger or consolidation in which an acquirer purchases the selling firm's assets.
For investment companies, the management fee and "other expenses,"
The periodic rate times the number of periods in a year. For example, a 5%
The effective, or true, annual rate of return. The APY is the rate actually
A SECurity that is collateralized by loans, leases, receivables, or installment contracts
A firm's productive resources.
A common element of a financial plan that describes projected capital spending and the
The fee paid on the extension date if the buyer wishes to continue the option.
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
Gives the lessee the option to purchase the asset at a price below fair market
The requirement that a claim holder voting against a plan of reorganization
Beta (Mutual Funds)
The measure of a fund's or stocks risk in relation to the market. A beta of 0.7 means
Beta equation (Mutual Funds)
The beta of a fund is determined as follows:
The Treasury and federal agencies are moving to a book-entry system in which SECurities are not represented by engraved pieces of paper but are maintained in computerized records at the
Chicago Mercantile Exchange (CME)
A not-for-profit corporation owned by its members. Its primary
An investment company that sells shares like any other corporation and usually does not
A transaction in which the purchaser's intention is to reduce or eliminate a short position in
A fee paid to a commercial bank in return for its legal commitment to lend funds that have
Comparative credit analysis
A method of analysis in which a firm is compared to others that have a desired
Conditional sales contracts
Similar to equipment trust certificates except that the lender is either the
A merchant banking subsidiary set up by several banks that may or may not be of the
credit granted by a firm to consumers for the purchase of goods or services. Also called
A market condition in which futures prices are higher in the distant delivery months.
Contingent deferred sales charge (CDSC)
The formal name for the load of a back-end load fund.
A SECurity that can be converted into common stock at the option of the SECurity holder,
Cost of funds
Interest rate associated with borrowing money.
The process of analyzing information on companies and bond issues in order to estimate the
Purchase of the financial guarantee of a large insurance company to raise funds.
The length of time for which the customer is granted credit.
The risk that an issuer of debt SECurities or a borrower may default on his obligations, or that the
A statistical technique wherein several financial characteristics are combined to form a single
The interest rate offered on an investment type insurance policy.
Lender of money.
A statistical methodology applied to a set of firms at a particular point in time.
Cumulative abnormal return (CAR)
Sum of the differences between the expected return on a stock and the
Cumulative probability distribution
A function that shows the probability that the random variable will
Value of cash, accounts receivable, inventories, marketable SECurities and other assets that
Days' sales in inventory ratio
The average number of days' worth of sales that is held in inventory.
Days' sales outstanding
Average collection period.
IOUs created through loan-type transactions - commercial paper, bank CDs, bills, bonds, and
Demand line of credit
A bank line of credit that enables a customer to borrow on a daily or on-demand basis.
A financial SECurity, such as an option, or future, whose value is derived in part from the
Direct stock-purchase programs
The purchase by investors of SECurities directly from the issuer.
Non-interest-bearing money market instruments that are issued at a discount and
Payments from fund or corporate cash flow. May include dividends from earnings, capital
Dividend yield (Funds)
Indicated yield represents return on a share of a mutual fund held over the past 12
Domestic International Sales Corporation (DISC)
A U.S. corporation that receives a tax incentive for
Employee stock fund
A firm-sponsored program that enables employees to purchase shares of the firm's
Investment funds established for the support of institutions such as colleges, private
Intermediate-term loans of Eurocurrencies made by banking syndicates to corporate and
Revolving credit without maturity.
Any excess of actual reserves above required reserves.
Excess return on the market portfolio
The difference between the return on the market portfolio and the
Also called abnormal returns, returns in excess of those required by some asset pricing model.
Exchange of assets
Acquisition of another company by purchase of its assets in exchange for cash or stock.
SECurity that grants the SECurity holder the right to exchange the SECurity for the
Instruments exempt from the registration requirements of the SECurities Act of 1933 or the
Federal agency securities
SECurities issued by corporations and agencies created by the U.S. government,
Federal credit agencies
Agencies of the federal government set up to supply credit to various classes of
Non-interest bearing deposits held in reserve for depository institutions at their district Federal
Federal funds market
The market where banks can borrow or lend reserves, allowing banks temporarily
Federal funds rate
This is the interest rate that banks with excess reserves at a Federal Reserve district bank
Federal Home Loan Banks
The institutions that regulate and lend to savings and loan associations. The
Federally related institutions
Arms of the federal government that are exempt from SEC registration and
Claims on real assets.
Five Cs of credit
Five characteristics that are used to form a judgement about a customer's creditworthiness:
Fixed-charge coverage ratio
A measure of a firm's ability to meet its fixed-charge obligations: the ratio of
A nonnegotiable debt SECurity that can be redeemed at some fixed price or according to
Foreign Sales Corporation (FSC)
A special type of corporation created by the Tax Reform Act of 1984 that
Foreign tax credit
Home country credit against domestic income tax for foreign taxes paid on foreign
Forward Fed funds
Fed funds traded for future delivery.
The organization of data to show how often certain values or ranges of values occur.
The fee initially paid by the buyer upon entering a split-fee option contract.
Full faith-and-credit obligations
The SECurity pledges for larger municipal bond issuers, such as states and
Set of funds with different investment objectives offered by one management company. In many
SECurity analysis that seeks to detect misvalued SECurities by an analysis of the firm's
The product of a statistical model to predict the fundamental risk of a SECurity using not
In the model for calculating fundamental beta, ratios in risk indexes other than
Debt maturing after more than one year.
The ratio of a pension plan's assets to its liabilities.
Related: interest rate risk
Funds From Operations (FFO)
used by real estate and other investment trusts to define the cash flow from
A mutual fund that can invest anywhere in the world, including the U.S.
When the Fed offers to buy SECurities, to sell SECurities, to do repo, or to do reverses, it solicits
Publicly owned stock in a firm is replaced with complete equity ownership by a
Gold exchange standard
A system of fixing exchange rates adopted in the Bretton Woods agreement. It
An international monetary system in which currencies are defined in terms of their gold
Compensation paid to top-level management by a target firm if a takeover occurs.
A delivery in which everything - endorsement, any necessary attached legal papers, etc. - is in
Good delivery and settlement procedures
Refers to PSA Uniform Practices such as cutoff times on delivery
Good 'til canceled
Sometimes simply called "GTC", it means an order to buy or sell stock that is good until
excess of the purchase price over the fair market value of the net assets acquired under purchase
See: government SECurities.
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