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Definition of Re-entry
This is a provision in some term insurance policies that allow the insured the right to renew the policy at a more favourable rate by providing updated evidence of insurability.
An entry that is made at the beginning of the current period so that the systems and procedures do not have to be altered to allow for previously accrued items.
the additional value inherent in the control interest as contrasted to a minority interest, which reflects its power of control
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.
the combined discounts for lack of control and marketability. g the constant growth rate in cash flows or net income used in the ADF, Gordon model, or present value factor.
regression analysis a statistical technique that minimizes the sum of the squared deviations between a dependent variable and one or more independent variables and provides the user
Same as PV, but usually includes a subtraction for an initial cash outlay.
the value in today’s dollars of cash flows that occur in different time periods.
Part of the return that is not due to systematic influences (market wide influences). In
Schedule of depreciation rates allowed for tax purposes.
Any depreciation method that produces larger deductions for depreciation in the
The change in the value of a firm's foreign currency denominated accounts due to a
Money owed by customers.
The ratio of net credit sales to average accounts receivable, a measure of how
In portfolio accounting, a straight-line accumulation of capital gains on discount
The accumulated coupon interest earned but not yet paid to the seller of a bond by the
A firm that is being acquired.
A firm or individual that is acquiring something.
Adjustable rate preferred stock (ARPS)
Publicly traded issues that may be collateralized by mortgages and MBSs.
Adjusted present value (APV)
The net present value analysis of an asset if financed solely by equity
After-tax real rate of return
Money after-tax rate of return minus the inflation rate.
Process in corporate financial planning whereby the smaller investment proposals of each of the
American Depositary Receipts (ADRs)
Certificates issued by a U.S. depositary bank, representing foreign
Securities certificates issued in the U.S. by a transfer agent acting on behalf of the foreign
Amortizing interest rate swap
Swap in which the principal or national amount rises (falls) as interest rates
Yearly record of a publicly held company's financial condition. It includes a description of the
Annualized holding period return
The annual rate of return that when compounded t times, would have
Annuity in arrears
An annuity with a first payment on full period hence, rather than immediately.
Formal request for funds for capital investment project.
Arbitrage-free option-pricing models
Yield curve option-pricing models.
Arithmetic average (mean) rate of return
Arithmetic mean return.
Arithmetic mean return
An average of the subperiod returns, calculated by summing the subperiod returns
Asian currency units (ACUs)
Dollar deposits held in Singapore or other Asian centers.
A common element of a financial plan that describes projected capital spending and the
Auction rate preferred stock (ARPS)
Floating rate preferred stock, the dividend on which is adjusted every
A section of an annual report containing the auditor's opinion about the veracity of the
Number of shares authorized for issuance by a firm's corporate charter.
The correlation of a variable with itself over successive time intervals.
Using past data to predict future data.
Average accounting return
The average project earnings after taxes and depreciation divided by the average
Average age of accounts receivable
The weighted-average age of all of the firm's outstanding invoices.
Average collection period, or days' receivables
The ratio of accounts receivables to sales, or the total
Average (across-day) measures
An estimation of price that uses the average or representative price of a
Average rate of return (ARR)
The ratio of the average cash inflow to the amount invested.
Balance sheet exposure
A computer message system linking major banks. It is used not for effecting payments, but as a
Base interest rate
related: Benchmark interest rate.
Bonds that are not registered on the books of the issuer. Such bonds are held in physical form by
Before-tax profit margin
The ratio of net income before taxes to net sales.
Benchmark interest rate
Also called the base interest rate, it is the minimum interest rate investors will
The requirement that a claim holder voting against a plan of reorganization
A currency that is not freely convertible to other currencies due to exchange controls.
A contract for privately placed debt.
The contract that sets forth the promises of a corporate bond issuer and the rights of
Book value per share
The ratio of stockholder equity to the average number of common shares. Book value
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
A rapid and sharp price decline.
An analysis of the level of sales at which a project would make zero profit.
Break-even lease payment
The lease payment at which a party to a prospective lease is indifferent between
Break-even payment rate
The prepayment rate of a MBS coupon that will produce the same CFY as that of
Break-even tax rate
The tax rate at which a party to a prospective transaction is indifferent between entering
related: Premium payback period.
A rise in a security's price above a resistance level (commonly its previous high price) or drop
Bretton Woods Agreement
An agreement signed by the original United Nations members in 1944 that
The large clearing banks that dominate deposit taking and short-term lending in the domestic
A market where an intermediary offers search services to buyers and sellers.
A spread strategy in which an investor buys an out-of-the-money put option, financing it by
A business that has terminated with a loss to creditors.
Amount used during a particular period to acquire or improve long-term assets such as
The makeup of the liabilities and stockholders' equity side of the balance sheet, especially
Interest that is not immediately expensed, but rather is considered as an asset and is then
Cash deficiency agreement
An agreement to invest cash in a project to the extent required to cover any cash
Cash flow after interest and taxes
Net income plus depreciation.
Cash flow per common share
Cash flow from operations minus preferred stock dividends, divided by the
Cash-flow break-even point
The point below which the firm will need either to obtain additional financing
An amount the insurance company will pay if the policyholder ends a whole life
Committee, AIMR Performance Presentation Standards Implementation Committee
The Association for Investment Management and research (AIMR)'s Performance Presentation Standards Implementation
Comparative credit analysis
A method of analysis in which a firm is compared to others that have a desired
Interest paid on previously earned interest as well as on the principal.
The number of compounding periods in a year. For example, quarterly
Comprehensive due diligence investigation
The investigation of a firm's business in conjunction with a
An understanding between a company and the host government that specifies the
The mean of all financial analysts' forecasts for a company.
Credit granted by a firm to consumers for the purchase of goods or services. Also called
Contingent deferred sales charge (CDSC)
The formal name for the load of a back-end load fund.
Controlled foreign corporation (CFC)
A foreign corporation whose voting stock is more than 50% owned
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.
Primary area of competence. Narrowly defined fields or tasks at which a company or
See: Correlation coefficient.
A standardized statistical measure of the dependence of two random variables,
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
Covered interest arbitrage
A portfolio manager invests dollars in an instrument denominated in a foreign
Covered or hedge option strategies
Strategies that involve a position in an option as well as a position in the
A put option position in which the option writer also is short the corresponding stock or has
A signal that provides accurate information; a signal that can be distinguish among senders.
The process of analyzing information on companies and bond issues in order to estimate the
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