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Definition of multiprocess handling
the ability of a worker to monitor
an amount or percentage deducted from an equity interest to reflect lack of marketability.
model for calculating DLOM for minority interests r the discount rate
The discount rate that reflects only the business risks of a project and abstracts from the
Requirement that none of an order be executed unless all of it can be executed at the specified price.
Total costs, explicit and implicit.
An arrangement whereby a security issue is canceled if the underwriter is unable
Also called surplus management, the task of managing funds of a financial
The decision regarding how an institution's funds should be distributed among the
Checks deposited by a company that have not yet been cleared.
Any large principal payment due at maturity for a bond or loan with or without a a sinking
A method developed by BARRA, a consulting firm in
The probability of not achieving a portfolio expected return.
In the mortgage pipeline, the risk that prospective borrowers of loans committed to be
An option that gives the right to buy the underlying futures contract.
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
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
decision allocation of invested funds between risk-free assets versus the risky portfolio.
Communication barrier between financiers (investment bankers) and traders. This barrier is
Committee, AIMR Performance Presentation Standards Implementation Committee
The Association for Investment Management and Research (AIMR)'s performance Presentation Standards Implementation
Related: Unsystematic risk
Contingent pension liability
Under ERISA, the firm is liable to the plan participants for up to 39% of the net
A short call option position in which the writer owns the number of shares of the underlying
Covered call writing strategy
A strategy that involves writing a call option on securities that the investor
Cumulative probability distribution
A function that shows the probability that the random variable will
A provision that prohibits the company from calling the bond before a certain date. During this
Dynamic asset allocation
An asset allocation strategy in which the asset mix is mechanistically shifted in
Effective call price
The strike price in an optional redemption provision plus the accrued interest to the
A type of mortgage pipeline risk that is generally created when the terms of the loan to be
Federally related institutions
Arms of the federal government that are exempt from SEC registration and
See:diversifiable risk or unsystematic risk.
With CMOs, the start of the cash flow cycle for the cash flow window.
Generally Accepted Accounting Principals (GAAP)
A technical accounting term that encompasses the
A 1933 act in which Congress forbade commercial banks to own, underwrite, or deal in
The right of the homeowner to prepay, or call, the mortgage at any time.
The sale of an asset in exchange for a specified series of payments (the installments).
Internally efficient market
Operationally efficient market.
In the mortgage pipeline, risk that occurs when the originator commits loan terms to the
Irrational call option
The implied call imbedded in the MBS. Identified as irrational because the call is
A financial obligation, or the cash outlay that must be made at a specific time to satisfy the
Liability funding strategies
Investment strategies that select assets so that cash flows will equal or exceed
An interest rate swap used to alter the cash flow characteristics of an institution's liabilities so
Limitation of possible loss to what has already been invested.
A security, such as a call option, in which the owner can only lose his initial
A security, such as a call option, in which the owner can only lose his initial investment.
A demand for additional funds because of adverse price movement. Maintenance margin
A negotiable security is said to have good marketability if there is an active secondary market
To seek information about an agent's behavior; a device that provides such information.
Mutually exclusive investment decisions
Investment decisions in which the acceptance of a project
Non-parallel shift in the yield curve
A shift in the yield curve in which yields do not change by the same
Nondiversifiability of human capital
The difficulty of diversifying one's human capital (the unique
Normal probability distribution
A probability distribution for a continuous random variable that is forms a
Open (good-til-cancelled) order
An individual investor can place an order to buy or sell a security. That
Operationally efficient market
Also called an internally efficient market, one in which investors can obtain
When a security is expected to appreciate at a rate faster than the overall market.
A process whereby two companies in different countries borrow each other's currency for a
Parallel shift in the yield curve
A shift in the yield curve in which the change in the yield on all maturities is
Performance attribution analysis
The decomposition of a money manager's performance results to explain
The evaluation of a manager's performance which involves, first, determining
The calculation of the return realized by a money manager over some time interval.
Shares of stock given to managers on the basis of performance as measured by earnings
Policy asset allocation
A long-term asset allocation method, in which the investor seeks to assess an
The relative likelihood of a particular outcome among all possible outcomes.
Probability density function
The probability function for a continuous random variable.
Also called a probability function, a function that describes all the values that the random variable can
A function that assigns a probability to each and every possible outcome.
The present value of the future cash flows divided by the initial investment. Also called
Ratios that focus on the profitability of the firm. Profit margins measure performance
Provisional call feature
A feature in a convertible issue that allows the issuer to call the issue during the noncall
Put-call parity relationship
The relationship between the price of a put and the price of a call on the same
An upward movement of prices. Opposite of reaction.
A probability used to determine a "sure" expected value (sometimes called a
The risk of falling short of any investment target.
The tendency of small firms (in terms of total market capitalization) to outperform the
Small issues exemption
Securities issues that involve less than $1.5 million are not required to file a
Specific issues market
The market in which dealers reverse in securities they wish to short.
Tactical Asset Allocation (TAA)
An asset allocation strategy that allows active departures from the normal
A short call option position in which the writer does not own shares of underlying stock
When a security is expected to appreciate at a slower rate than the overall market.
Full liability for the debt and other obligations of a legal entity. The general partners of a
Generic term for firms that buy, sell, and underwrite securities.
Wall Street analyst
Related: Sell-side analyst.
Stock that has fallen out of favor with investors; tends to have a low P/E (price to earnings ratio).
Yield to call
The percentage rate of a bond or note, if you were to buy and hold the security until the call date.
SPECIFIC INVOICE PRICES
An inventory valuation method in which a company values the items in its ending inventory based
The process of satisfying stakeholders in the organization that managers have acted in the best interests of the stakeholders, a result of the stewardship function of managers, which takes place through accounting.
Allocation base A measure of activity or volume such as labour
hours, machine hours or volume of production
The process of spreading production overhead equitably over the volume of production of goods or services.
See cash value added.
Allowance for doubtful accounts
A contra account related to accounts receivable that represents the amounts that the company expects will not be collected.
A method of adjusting accounts receivable to the amount that is expected to be collected based on company experience.
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