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Definition of Pairoff
A buy-back to offset and effectively liquidate a prior sale of securities.
Rule in bankruptcy proceedings whereby senior creditors are required to be paid in full
Bond or note secured by assets of company.
A security that is collateralized by loans, leases, receivables, or installment contracts
A debt or equity security not classified as a held-to-maturity security or a trading security. Can be classified as a current or noncurrent investment depending on the intended holding period.
The fee paid on the extension date if the buyer wishes to continue the option.
The subsequent subtraction from inventory records of those parts used
Brokerage house clerical operations that support, but do not include, the trading of stocks and
This term refers to the simultaneous issue of a life annuity with a non-guaranteed period and a guaranteed life insurance policy [usually whole life or term to 100]. The face value of the life insurance would be the same amount that was used to purchase the annuity. This combination of life annuity providing the highest payout of all types of annuities, along with a guaranteed life insurance policy allowed an uninsurable person to convert his/her RRSP into the best choice of annuity and guarantee that upon his/her death, the full value of the annuity would be paid tax free through the life insurance policy to his family members. However, in the early 1990's, the Federal tax authorities put a stop to the issuing of standard life rates to rated or uninsurable applicants. Insuring a life annuity in this manner is still an excellent way to provide guaranteed tax free funds to family members but the application for the annuity and the application for the life insurance are separate transactions and today, most likely conducted through two different insurance companies so that there is no suspicion of preferential treatment given to the life insurance application.
An intercompany loan channeled through a bank.
A loan in which two companies in separate countries borrow each other's currency for a
1) When bond yields and prices fall, the market is said to back-up.
A procedure for making the effective date of a policy earlier than the application date. backdating is often used to make the age of the consumer at policy issue lower than it actually was in order to get a lower premium.
a streamlined cost accounting method that speeds up, simplifies, and reduces accounting effort in an environment that minimizes inventory balances, requires
A market condition in which futures prices are lower in the distant delivery months than in
A method of securities distribution/ underwriting in which the securities firm agrees to sell
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
Builder buydown loan
A mortgage loan on newly developed property that the builder subsidizes during the
To purchase an asset; taking a long position.
A passive investment strategy with no active buying and selling of stocks from the
Another term for a repo.
To cover, offset or close out a short position. Related: evening up, liquidation.
Buy limit order
A conditional trading order that indicates a security may be purchased only at the designated
Buy on close
To buy at the end of the trading session at a price within the closing range.
Buy on margin
A transaction in which an investor borrows to buy additional shares, using the shares
Buy on opening
To buy at the beginning of a trading session at a price within the opening range.
This is an agreement entered into by the owners of a business to define the conditions under which the interests of each shareholder will be bought and sold. The agreement sets the value of each shareholders interest and stipulates what happens when one of the owners wishes to dispose of his/her interest during his/her lifetime as well as disposal of interest upon death or disability. Life insurance, critical illness coverage and disability insurance are major considerations to help fund this type of agreement.
A financial analyst employed by a non-brokerage firm, typically one of the larger money
Mortgages in which monthly payments consist of principal and interest, with portions of these
Buying the index
Purchasing the stocks in the S&P 500 in the same proportion as the index to achieve the
Purchase of a controlling interest (or percent of shares) of a company's stock. A leveraged buy-out is
a system using transfer prices; see transfer
A transaction in which the seller's intention is to reduce or eliminate a long position in a stock,
One of two parties to a conditional sale agreement, the other being the conditional seller.
A type of agreement to sell whereby a seller retains title to goods sold and delivered to a purchaser until full payment has been made.
Conditional Sale Agreement
An agreement entered into between a conditional buyer and a conditional seller setting out the terms under which goods change hands.
Conditional sales contracts
Similar to equipment trust certificates except that the lender is either the
Contingent deferred sales charge (CDSC)
The formal name for the load of a back-end load fund.
Cost of sales
The manufacture or purchase price of goods sold in a period or the cost of providing a service.
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
Non-interest-bearing money market instruments that are issued at a discount and
Discounted payback period rule
An investment decision rule in which the cash flows are discounted at an
With respect to a project financing, an arrangement under which the sponsors of a project
Domestic International Sales Corporation (DISC)
A U.S. corporation that receives a tax incentive for
Refers to the investors percentage ownership of a company that can be re-acquired by the company, usually at a pre-determined amount.
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,
The retrospective process of measuring performance, comparing it with plan and taking corrective action.
Foreign Sales Corporation (FSC)
A special type of corporation created by the Tax Reform Act of 1984 that
The purchase of items exceeding the quantity levels indicated
A method for hedging price risk which involves an agreement between a lender and an investor
Up-front gain recognized from the securitization and sale of a pool
Negotiable U.S. Treasury securities.
The total sales recorded prior to sales discounts and returns.
The sale of an asset in exchange for a specified series of payments (the installments).
The purchase of one business entity by another, largely using borrowed
Leveraged buyout (LBO)
A transaction used for taking a public corporation private financed through the use
leveraged buyout (LBO)
Acquisition of the firm by a private group using substantial borrowed funds.
Limitation on merger, consolidation, or sale
A bond covenant that restricts in some way a firm's ability to
Limitation on sale-and-leaseback
A bond covenant that restricts in some way a firm's ability to enter into
An option that allows the buyer to choose as the option strike price any price of the
The offsetting of a current year loss against the reported taxable
a decision that compares the cost of
Management buyout (MBO)
Leveraged buyout whereby the acquiring group is led by the firm's management.
management buyout (MBO)
Acquisition of the firm by its own management in a leveraged buyout.
Manufactured housing securities (MHSs)
Loans on manufactured homes - that is, factory-built or
securities backed by a pool of mortgage loans.
Mortgage-Backed Securities Clearing Corporation
A wholly owned subsidiary of the Midwest Stock
A system, such as the arrangement between the CME and SIMEX, which allows trading
Situation in which the terms of an offering are determined by negotiation between the issuer
Total revenue, less the cost of sales returns, allowances, and discounts.
NET SALES (revenue)
The amount sold after customers’ returns, sales discounts, and other allowances are taken away from
Normal backwardation theory
Holds that the futures price will be bid down to a level below the expected
NUMBER OF DAYS SALES IN RECEIVABLES
(also called average collection period). The number of days of net sales that are tied up in credit sales (accounts receivable) that haven’t been collected yet.
Elimination of a long or short position by making an opposite transaction. Related: liquidation.
A transaction in which the seller's intention is to create or increase a short position in a given
A pool of fixed-income securities backed by a package of assets (i.e. mortgages)
The length of time it takes to recover the initial cost of a project, without regard to the time value of money.
A method of investment appraisal that calculates the number of years taken for the cash flows from an investment to cover the initial capital outlay.
The length of time required for the net revenues of an investment for the net revenues of an investment to return the cost of the investment.
A capital budgeting analysis method that calculates the amount of
The number of years necessary for the net cash flows of an
the time it takes an investor to recoup an
Time until cash flows recover the initial investment of the project.
percentage of sales models
Planning model in which sales forecasts are the driving variables and most other variables are
Related: retention rate.
Fraction of earnings retained by the firm.
point of sale (POS)
The terminal at which a customer uses his/her debit card to make a direct payment transaction. See also Interac Direct Payment.
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.
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.
Price/sales ratio (PS Ratio)
Determined by dividing current stock price by revenue per share (adjusted for stock splits).
A budget that allocates funds in line with strategies.
Project loan securities
securities backed by a variety of FHA-insured loan types - primarily multi-family
Protective put buying strategy
A strategy that involves buying a put option on the underlying security that is
Public Securities Administration (PSA)
The trade association for primary dealers in U.S. government
Purchase and sale
A method of securities distribution in which the securities firm purchases the securities
RATIO OF NET INCOME TO NET SALES
A ratio that shows how much net income (profit) a company made on each dollar of net sales. Here’s the formula:
RATIO OF NET SALES TO NET INCOME
A ratio that shows how much a company had to collect in net sales to make a dollar of profit. Figure it this way:
Restatement of Prior-Year Financial Statements
A recasting of prior-year financial statements to remove the effects of an error or other adjustment and report them on a new basis.
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