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Definition of Greenmail
Situation in which a large block of stock is held by an unfriendly company, forcing the target
A merger or consolidation in which an acquirer purchases the acquiree's stock.
Publicly traded issues that may be collateralized by mortgages and MBSs.
The second-largest stock exchange in the United States. It trades
Yearly amount payable by a client for a policy or component.
Floating rate preferred stock, the dividend on which is adjusted every
A benefit that automatically forfeits premium payments.
The beta of a stock is determined as follows:
Brokerage firms that help to find potential buyers or sellers of large block trades.
A large trading order, defined on the New York stock Exchange as an order that consists of
A group of shareholders banding together to vote their shares in a single block.
A currency that is not freely convertible to other currencies due to exchange controls.
large and creditworthy company.
The theoretical amount per share that each stockholder would receive if a company’s assets were sold on the balance sheet’s date. Book value equals:
Ownership shares issued by a business corporation. A business
The total amount of plant, equipment, and other physical capital.
These are securities that represent equity ownership in a company. Common shares let an
Shares of ownership sold to the public.
A financial security that represents an ownership claim on the
Ownership shares in a publicly held corporation.
That part of the capital stock of a corporation that carries voting rights and represents
Common stock equivalent
A convertible security that is traded like an equity issue because the optioned
Common stock market
The market for trading equities, not including preferred stock.
Common stock/other equity
Value of outstanding common shares at par, plus accumulated retained
Common stock ratios
Ratios that are designed to measure the relative claims of stockholders to earnings
Assets acquired to create money. May include plant, machinery and equipment, shares of another company etc.
company cost of capital
Expected rate of return demanded by investors in a company, determined by the average risk of the company’s assets and operations.
Related: Unsystematic risk
See asset-specific risk
Conflict between bondholders and stockholders
These two groups may have interests in a corporation that
Inventories owned by a company, but located on the premises
the additional value inherent in the control interest as contrasted to a minority interest, which reflects its power of control
The percentage by which the conversion price in a convertible security exceeds the
Convertible exchangeable preferred stock
Convertible preferred stock that may be exchanged, at the
Convertible preferred stock
Preferred stock that can be converted into common stock at the option of the holder.
Cost company arrangement
Arrangement whereby the shareholders of a project receive output free of
Cost of Common Stock
The rate of return required by the investors in the common stock of
Cost of Preferred Stock
The rate of return required by the investors in the preferred stock of
Cumulative preferred stock
Preferred stock whose dividends accrue, should the issuer not make timely
A differential in promised yield that compensates the investor for the risk inherent in
Difference in promised yields between a default-free bond and a riskier bond.
The informal and frequently unauthorized retention of excess inventory on the shop floor, which is used as buffer safety stock.
Depository Trust Company (DTC)
DTC is a user-owned securities depository which accepts deposits of
Direct stock-purchase programs
The purchase by investors of securities directly from the issuer.
Dividend yield (Stocks)
Indicated yield represents annual dividends divided by current stock price.
Earnings per share of common stock
How much profit a company made on each share of common stock this year.
Employee stock fund
A firm-sponsored program that enables employees to purchase shares of the firm's
Employee stock ownership plan (ESOP)
A company contributes to a trust fund that buys stock on behalf of
Employee Stock Ownership Plan (ESOP)
a profit-sharing compensation program in which investments are made in
Employee Stock Ownership Plan (ESOP)
A fund containing company stock and owned by employees, paid for by ongoing contributions by the employer.
Exchange of stock
Acquisition of another company by purchase of its stock in exchange for cash or shares.
Feasible target payout ratios
Payout ratios that are consistent with the availability of excess funds to make
company engaged in making loans to individuals or businesses. Unlike a bank, it does not receive deposits from the public.
Low-cost, high-usage inventory items stored near the shop floor,
A currency trades at a forward premium when its forward price is higher than its spot price.
Common stock of a company that has an opportunity to invest money and earn more than the
Heavenly Parachute Stock Option
A nonqualified stock option that allows a deceased option holder’s estate up to three years in which to exercise his or her
A debt security for which the investing entity has both the positive
A corporation that owns enough voting stock in another firm to control management and
Incentive Stock Option
An option to purchase company stock that is not taxable
Common stock with a high dividend yield and few profitable investment opportunities.
A firm licensed to sell insurance to the public.
Loan made by one unit of a corporation to another unit of the same corporation.
Transaction carried out between two units of the same corporation.
Law of large numbers
The mean of a random sample approaches the mean (expected value) of the
Privately placed common stock, so-called because the SEC requires a letter from the purchaser
A premium that remains unchanged throughout the life of a policy
Level Premium Life Insurance
This is a type of insurance for which the cost is distributed evenly over the premium payment period. The premium remains the same from year to year and is more than actual cost of protection in the earlier years of the policy and less than the actual cost of protection in the later years. The excess paid in the early years builds up a reserve to cover the higher cost in the later years.
limited liability company
an organizational form that is a hybrid of the corporate and partnership organizational
Forward rate minus expected future short-term interest rate.
stocks that are traded on an exchange.
stocks that are traded on an exchange.
A production scheduling system under which products are completed
Management/closely held shares
Percentage of shares held by persons closely related to a company, as
Margin account (Stocks)
A leverageable account in which stocks can be purchased for a combination of
market risk premium
Risk premium of market portfolio. Difference between market return and return on risk-free Treasury bills.
Extra average return from investing in longversus short-term Treasury securities.
New York Stock Exchange (NYSE)
Also known as the Big Board or The Exhange. More than 2,00 common
No par value stock
stock issued by the company that does not have an arbitrary value (par value) assigned to it.
Non-cumulative preferred stock
Preferred stock whose holders must forgo dividend payments when the
Nonqualified Stock Option
A stock option not given any favorable tax treatment
The option price.
Outbound stock point
A designated inventory location on the shop floor between
A company that retains control over one or more other companies.
Philadelphia Stock Exchange (PHLX)
A securities exchange where American and European foreign
A security that ranks junior to preferred stock but senior to common stock in the right to
Preferred equity redemption stock (PERC)
Preferred stock that converts automatically into equity at a
A security that shows ownership in a corporation and gives the holder a claim, prior to the
A type of equity security where holders have a claim on the assets
A type of stock that usually pays a fixed dividend prior to any distributions
stock that takes priority over common stock in regard to dividends.
Preferred stock agreement
A contract for preferred stock.
Preferred Stock Stock that has a claim on assets and dividends of a corporation that are prior
to that of common stock. Preferred stock typically does not carry the right to vote.
1) Amount paid for a bond above the par value.
This is your payment for the cost of insurance. You may pay annually, semi-annually, quarterly or monthly. The least expensive method is annually. Using any of the other payment modes will cost you more money. For example, paying monthly will cost about 17% more. If you pay annually and terminate your coverage part way through the year, you may not receive a refund for the remaining months to the annual renewal date.
Annual amount payable, by a client, for selected product or service.
A bond that is selling for more than its par value.
Premium (Credit Insurance)
Annual or monthly amounts payable, by a client, for a selected insurance coverage to insure debt obligations to their creditors are protected.
A nonqualified stock option whose option price is set substantially
Payment schedule of policy premiums, usually selected by the policy owner (monthly, quarterly, annually).
After premiums have been paid for a number of years, further annual premiums may be paid by the current dividends and the surrender of some of the paid-up additions which have built up in the policy. In effect, the policy can begin to pay for itself. Whether a policy becomes eligible for premium offset, the date on which it becomes eligible and whether it remains eligible once premium offset begins, will all depend on how the dividend scale changes over the years. Since dividends are not guaranteed, premium offset cannot be guaranteed either.
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