|Information Coefficient (IC)|
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Definition of Information Coefficient (IC)
Information Coefficient (IC)
The correlation between predicted and actual stock returns, sometimes used to
A method for dividing inventory into classifications,
A monetary policy of matching wage and price increases with money supply increases so that the real money supply does not fall and push the economy into recession.
The principles, bases, conventions, rules and procedures adopted by management in preparing and presenting financial statements.
The sum of cash, accounts receivable, and short-term marketable
IRS rules used to allocate income on export sales to a foreign sales corporation.
Capitalizing and reporting as assets significant portions of
a process of service department cost allocation
Certificates issued by a U.S. depositary bank, representing foreign
An option that may be exercised at any time up to and including the expiration date.
An option that can be exercised any time until its
Securities certificates issued in the U.S. by a transfer agent acting on behalf of the foreign
The second-largest stock exchange in the United States. It trades
An option contract that can be exercised at any time between the date of purchase and
The process of attempting to infer the presence of potential problems
Arrangements whereby customers who pay before the final date may be entitled to deduct a
The party applying for an insurance policy.
A signed statement of facts made by a person applying for life insurance and then used by the insurance company to decide whether or not to issue a policy. The application becomes part of the insurance contract when the policy is issued.
Arbitrage-free option-pricing models
Yield curve option-pricing models.
Arbitrage Pricing Theory (APT)
An alternative model to the capital asset pricing model developed by
Arithmetic average (mean) rate of return
Arithmetic mean return.
Arithmetic mean return
An average of the subperiod returns, calculated by summing the subperiod returns
Arm's length price
The price at which a willing buyer and a willing unrelated seller would freely agree to
Articles of incorporation
Legal document establishing a corporation and its structure and purpose.
When numbers from different financial statements relate to one another.
A dealer's price to sell a security; also called the offer price.
Asset pricing model
A model for determining the required rate of return on an asset.
Asset pricing model
A model, such as the Capital Asset Pricing Model (CAPM), that determines the required
The amount of total risk that can be eliminated by diversification by
information that is known to some people but not to other people.
A situation wherein participants in a transaction have different net tax rates.
Automatic Benefits Payment
Automatic payment of moneys derived from a benefit.
Any feature built into the economy that automatically cushions fluctuations.
The restricting of liability holders from collection efforts of collateral seizure, which is
Automatic Waiver of Premium
A benefit that automatically forfeits premium payments.
Brokerage house clerical operations that support, but do not include, the trading of stocks and
BAN (Bank anticipation notes)
Notes issued by states and municipalities to obtain interim financing for
Gives the lessee the option to purchase the asset at a price below fair market
In a balance of payments, the basic balance is the net balance of the combination of the current
Basic business strategies
Key strategies a firm intends to pursue in carrying out its business plan.
basic earnings per share (EPS)
This important ratio equals the net
Basic Earnings Power Ratio
Percentage of earnings relative to total assets; indication of how
Basic IRR rule
Accept the project if IRR is greater than the discount rate; reject the project is lower than the
Price expressed in terms of yield to maturity or annual rate of return.
Picking for several summarized orders at the same time, thereby
A policy designed to increase an economy's prosperity at the expense of another country's prosperity.
This is the person who benefits from the terms of a trust, a will, an RRSP, a RRIF, a LIF, an annuity or a life insurance policy. In relation to RRSP's, RRIF's, LIF's, Annuities and of course life insurance, if the beneficiary is a spouse, parent, offspring or grand-child, they are considered to be a preferred beneficiary. If the insured has named a preferred beneficiary, the death benefit is invariably protected from creditors. There have been some court challenges of this right of protection but so far they have been unsuccessful. See "Creditor Protection" below. A beneficiary under the age of 18 must be represented by an individual guardian over the age of 18 or a public official who represents minors generally. A policy owner may, in the designation of a beneficiary, appoint someone to act as trustee for a minor. Death benefits are not subject to income taxes. If you make your beneficiary your estate, the death benefit will be included in your assets for probate. Probate filing fees are currently $14 per thousand of estate value in British Columbia and $15 per thousand of estate value in Ontario.
The person designated to receive proceeds entitled by a benefit. Payment of a benefit is triggered by an event.
Beneficiary (Credit Insurance)
The person or party designated to receive proceeds entitled by a benefit. Payment of a benefit is triggered by an event. In the case of credit insurance, the beneficiary will always be the creditor.
A measurement of the extent to which the returns on a given stock move with stock market.
This is the quoted bid, or the highest price an investor is willing to pay to buy a security. Practically
Bill and Hold Practices
Products that have been sold with an explicit agreement that delivery
Binomial option pricing model
An option pricing model in which the underlying asset can take on only two
Black-Scholes option-pricing model
A model for pricing call options based on arbitrage arguments that uses
The amount by which government spending exceeds government revenues.
The excess of government spending over tax receipts.
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 financial chart usually used to plot the high, low, open,
Capital asset pricing model (CAPM)
An economic theory that describes the relationship between risk and
Capital Asset Pricing Model (CAPM)
A model for estimating equilibrium rates of return and values of
capital asset pricing model (CAPM)
Theory of the relationship between risk and return which states that the expected risk
Capital market efficiency
Reflects the relative amount of wealth wasted in making transactions. An efficient
Cash deficiency agreement
An agreement to invest cash in a project to the extent required to cover any cash
Certificate of deposit (CD)
Also called a time deposit, this is a certificate issued by a bank or thrift that
Certificate of Deposit (CD)
A bank deposit that cannot be withdrawn for a specified period of time. See also term deposit.
The market model applied to a single security. The slope of the line is a security's beta.
Selecting specific assets for sale so as to record desired gains or losses.
Chicago Mercantile Exchange (CME)
A not-for-profit corporation owned by its members. Its primary
chief financial officer (CFO)
Officer who oversees the treasurer and controller and sets overall financial strategy.
The school of macroeconomic thought prior to the rise of Keynesianism.
Bond price excluding accrued interest.
coefficient of correlation
a measure of dispersion that indicates the degree of relative association existing between two variables
Coefficient of determination
A measure of the goodness of fit of the relationship between the dependent and
coefficient of determination
a measure of dispersion that
coefficient of variation
a measure of risk used when the standard deviations for multiple projects are approximately
Decreasing inflation by immediately decreasing the money growth rate to a new, low rate. Contrast with gradualism.
Procedures followed by a firm in attempting to collect accounts receivables.
Procedures to collect and monitor receivables.
Related: Unsystematic risk
See asset-specific risk
Policies which enhance each other.
Movement of cash from different lockbox locations into a single concentration
A measure of investors' faith in the economy and the securities market. A low or
Conflict between bondholders and stockholders
These two groups may have interests in a corporation that
Consumer Price Index (CPI)
The CPI, as it is called, measures the prices of consumer goods and services and is a
Consumer Price Index (CPI)
An index calculated by tracking the cost of a typical bundle of consumer goods and services over time. It is commonly used to measure inflation.
This is the person designated to receive the death benefit of a life insurance policy if the primary beneficiary dies before the life insured. This is a consideration when husband and wife make each other the beneficiary of their coverage. Should they both die in the same car accident or plane crash, the death benefits would go to each others estate and creditor claims could be made against them. Particularly if minor children could be survivors, then a trustee contingent beneficiary should be named.
Conversion parity price
Related:Market conversion price
The contractually specified price per share at which a convertible security can be
A standardized statistical measure of the dependence of two random variables,
A measure of the tendency of two variables to change values
A statistic in which the covariance is scaled to a
cost-benefit analysis the analytical process of comparing the
relative costs and benefits that result from a specific course
A method of pricing in which a mark-up is added to the total product/service cost.
Falling during expansions and rising during recessions. A countercyclical policy stimulates during a recession and contracts during an expansion.
Creative Accounting Practices
Any and all steps used to play the financial numbers game, including
Standards set to determine the amount and nature of credit to extend to customers.
Critical Growth Periods
Times in a company's history when growth is essential and without which survival of the business might be in jeopardy.
Critical Illness Insurance
Coverage that provides a lump-sum payment should you be diagnosed with a critical illness and survive a pre-determined period of time. There are no restrictions on how you use your benefit.
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