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Definition of Decile rank
Performance over time, rated on a scale of 1-10.1 indicates that a mutual fund's return was in the
a listing of service departments in an order that begins with the one providing the most service
Cash flow provided by operating
Automatic payment of moneys derived from a benefit.
With some exceptions, the cash effects of transactions
Cash receipts and payments involving
Cash receipts and payments involving
Costs and benefits that would occur if a particular course of action were
Employer-paid insurance that provides their employees with wage compensation if they are injured on the job.
Annual report required by the SEC each year. Provides a comprehensive overview of a company's state
mutual funds that do not charge an upfront or back-end commission, but instead take out up to
Part of the return that is not due to systematic influences (market wide influences). In
Goods may be returned to the seller by the purchaser without restrictions.
Schedule of depreciation rates Allowed for tax purposes.
Any depreciation method that produces larger deductions for depreciation in the
(1) The estimated useful life of the fixed asset being depreciated is
Any of several methods that recognize an increased amount
Accounting rate of return (ARR)
A method of investment appraisal that measures
accounting rate of return (ARR)
the rate of earnings obtained on the average capital investment over the life of a capital project; computed as average annual profits divided by average investment; not based on cash flow
Accounts receivable turnover
The ratio of net credit sales to average accounts receivable, a measure of how
accounts receivable turnover ratio
A ratio computed by dividing annual
Accumulated Other Comprehensive Income
Cumulative gains or losses reported in shareholders'
acid test ratio (also called the quick ratio)
The sum of cash, accounts receivable, and short-term marketable
Active portfolio strategy
A strategy that uses available information and forecasting techniques to seek a
an organizational unit that performs management activities benefiting the entire organization;
After-tax real rate of return
Money after-tax rate of return minus the inflation rate.
All equity rate
The discount rate that reflects only the business risks of a project and abstracts from the
Total costs, explicit and implicit.
All or none
Requirement that none of an order be executed unless All of it can be executed at the specified price.
An arrangement whereby a security issue is canceled if the underwriter is unable
assign based on the use of a cost driver, a cost predictor,
the systematic assignment of an amount to a recipient
The process of storing costs in one account and shifting them to other
Allocation base A measure of activity or volume such as labour
hours, machine hours or volume of production
Allowance for bad debts
An offset to the accounts receivable balance, against which
Allowance for doubtful accounts
A contra account related to accounts receivable that represents the amounts that the company expects will not be collected.
Allowance for Doubtful Accounts
An estimate of the uncollectible portion of accounts receivable
A method of adjusting accounts receivable to the amount that is expected to be collected based on company experience.
Annual fund operating expenses
For investment companies, the management fee and "other expenses,"
The fund return, for any 12-month period, including changes in unit value and the reinvestment of distributions, but not taking into account sales, redemption, distribution or other optional charges or income taxes payable by any unitholder that would reduce returns.
Annualized holding period return
The annual rate of return that when compounded t times, would have
the amount of overhead that has been assigned to Work in Process Inventory as a result of productive activity; credits for this amount are to an overhead account
approximated net realizable value at split-off allocation
a method of Allocating joint cost to joint products using a
Arithmetic average (mean) rate of return
Arithmetic mean return.
Arithmetic mean return
An average of the subperiod returns, calculated by summing the subperiod returns
Asset allocation decision
The decision regarding how an institution's funds should be distributed among the
Extent to which a company's net assets cover a particular debt obligation, class of preferred stock, or equity position.
A bond indenture restriction that permits additional borrowing on if the ratio of assets to
The ratio of net sales to total assets.
a ratio measuring asset productivity and showing the number of sales dollars generated by each dollar of assets
asset turnover ratio
A broad-gauge ratio computed by dividing annual
An option is at-the-money if the strike price of the option is equal to the market price of the
Average accounting return
The average project earnings after taxes and depreciation divided by the average
Average rate of return (ARR)
The ratio of the average cash inflow to the amount invested.
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
Any large principal payment due at maturity for a bond or loan with or without a a sinking
Money owed to the bank in a cheque account where payments exceed receipts.
A strategy in which the maturities of the securities included in the portfolio are concentrated
BARRA's performance analysis (PERFAN)
A method developed by BARRA, a consulting firm in
Beta equation (Mutual Funds)
The beta of a fund is determined as follows:
Beta (Mutual Funds)
The measure of a fund's or stocks risk in relation to the market. A beta of 0.7 means
A steep and rapid increase in price followed by a steep and rapid drop. This is an indicator seen
Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees
A committee formed in response to SEC chairman Arthur Levitt's initiative to improve the financial
book rate of return
Accounting income divided by book value.
Book yield is the investment income earned in a year on a portfolio of assets purchased over a number of years and at different interest rates, divided by the book value of those assets.
In the mortgage pipeline, the risk that prospective borrowers of loans committed to be
Related: Premium payback period.
A strategy in which a portfolio is constructed so that the maturities of its securities are highly
Business Expansion Investment
The use of capital to create more money through the addition of fixed assets or through income producing vehicles.
A passive investment strategy with no active buying and selling of stocks from the
Buy limit order
A conditional trading order that indicates a security may be purchased only at the designated
An option that gives the right to buy the underlying futures contract.
a. An option to buy a certain quantity of a stock or commodity for a
Call an option
To exercise a cAll option.
A date before maturity, specified at issuance, when the issuer of a bond may retire part of the bond
Call money rate
Also cAlled the broker loan rate , the interest rate that banks charge brokers to finance
An option contract that gives its holder the right (but not the obligation) to purchase a specified
A contract that gives the holder the right to buy an asset for a
Right to buy an asset at a specified exercise price on or before the exercise date.
The price, specified at issuance, at which the issuer of a bond may retire part of the bond at a
The price for which a bond can be repaid before maturity under a cAll provision.
A feature of some cAllable bonds that establishes an initial period when the bonds may not be
An embedded option granting a bond issuer the right to buy back All or part of the issue prior
The combination of cash flow uncertainty and reinvestment risk introduced by a cAll provision.
A swaption in which the buyer has the right to enter into a swap as a fixed-rate payer. The
A financial security such as a bond with a cAll option attached to it, i.e., the issuer has the right to
A bond that Allows the issuer to buy back the bond at a
Bond that may be repurchased by the issuer before maturity at specified cAll price.
decision Allocation of invested funds between risk-free assets versus the risky portfolio.
Capital Consumption Allowance
Capital Cost Allowance (CCA)
The annual depreciation expense Allowed by the Canadian Income Tax Act.
capital investment analysis
Refers to various techniques and procedures
Money used to purchase fixed assets for a business, such as land, buildings, or machinery. Also, money invested in a business on the understanding that it will be used to purchase permanent assets rather than to cover day-to-day operating expenses.
Refers to recouping, or regaining, invested capital over
CARs (cumulative abnormal returns)
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.
Cash flow coverage ratio
The number of times that financial obligations (for interest, principal payments,
Cash flow time-line
Line depicting the operating activities and cash flows for a firm over a particular period.
The number of cash cycles completed in one year.
Communication barrier between financiers (investment bankers) and traders. This barrier is
An investment company that sells shares like any other corporation and usuAlly does not
An internal department within a company staffed by specialists in collecting past due accounts or accounts receivable.
A strategy in which a put and with the same strike price and expiration are either both
Committee, AIMR Performance Presentation Standards Implementation Committee
The Association for investment Management and Research (AIMR)'s Performance Presentation Standards Implementation
Common stock/other equity
Value of outstanding common shares at par, plus accumulated retained
a foundation for the compensation plan that addresses the role compensation should play in the organization
Raw materials or subassemblies used to make either finished goods
computer integrated manufacturing (CIM)
the integration of two or more flexible manufacturing systems through the use of a host computer and an information networking system
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