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Financial Terms | |
Red herring |
Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
Main Page: financial, credit, business, financial advisor, inventory, inventory control, tax advisor, stock trading, Also see related: mortgage, home, credit, homebuyer, homebuying, home buyer, buy home, home financing, first time homebuyer, |
Definition of Red herringRed herringA preliminary prospectus containing information required by the SEC. It excludes the offering
Related Terms:Accidental Dismemberment: (Credit Insurance)Provides additional financial security should an insured person be dismembered or lose the use of a limb as the result of an accident. Adjustable rate preferred stock (ARPS)Publicly traded issues that may be collateralized by mortgages and MBSs. Amortization (Credit Insurance)Refers to the reduction of debt by regular payments of interest and principal in order to pay off a loan by maturity. Auction rate preferred stock (ARPS)Floating rate preferred stock, the dividend on which is adjusted every 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. Best-interests-of-creditors testThe requirement that a claim holder voting against a plan of reorganization Borrower (Credit Insurance)A consumer who borrows money from a lender. ![]() Brokered marketA market where an intermediary offers search services to buyers and sellers. Commercial Business Loan (Credit Insurance)An agreement between a creditor and a borrower, where the creditor has loaned an amount to the borrower for business purposes. Comparative credit analysisA method of analysis in which a firm is compared to others that have a desired Consumer creditCredit granted by a firm to consumers for the purchase of goods or services. Also called Consumer Credit Protection ActA federal Act specifying the proportion of Contingent deferred sales charge (CDSC)The formal name for the load of a back-end load fund. Convertible exchangeable preferred stockConvertible preferred stock that may be exchanged, at the Convertible preferred stockPreferred stock that can be converted into common stock at the option of the holder. cost of goods manufactured (CGM)the total cost of the Cost of Preferred StockThe rate of return required by the investors in the preferred stock of cost reductionthe practice of lowering current costs, especially Covered callA short call option position in which the writer owns the number of shares of the underlying Covered call writing strategyA strategy that involves writing a call option on securities that the investor Covered interest arbitrageA portfolio manager invests dollars in an instrument denominated in a foreign Covered or hedge option strategiesStrategies that involve a position in an option as well as a position in the Covered PutA put option position in which the option writer also is short the corresponding stock or has Credible signalA signal that provides accurate information; a signal that can be distinguish among senders. CreditMoney loaned. CreditBuying or selling goods or services now with the intention of payment following at some time in CreditOne side of a journal entry, usually depicted as the right side. CreditA rating of a company's credit (ability to payback debt), usually by a third party credit agency. creditOn your bank statement, 'credit' represents funds that you have deposited into your account. The opposite of a credit is a debit. Credit analysisThe process of analyzing information on companies and bond issues in order to estimate the credit analysisProcedure to determine the likelihood a customer will pay its bills. credit bureauAn organization that provides financial institutions with credit information concerning existing or potential customers who are looking to obtain credit services. credit cardA revolving source of credit with a pre-established limit. You have to pay interest on a credit card if you have an outstanding balance. Credit CrunchA decline in the ability or willingness of banks to lend. Credit enhancementPurchase of the financial guarantee of a large insurance company to raise funds. Credit LossA loan receivable that has proven uncollectible and is written off. credit memoA record of the funds which have been credited to your account. Credit periodThe length of time for which the customer is granted credit. credit policyStandards set to determine the amount and nature of credit to extend to customers. Credit RationingRestriction of loans by lenders so that not all borrowers willing to pay the current interest rate are able to obtain loans. Credit riskThe risk that an issuer of debt securities or a borrower may default on his obligations, or that the Credit RiskFinancial and moral risk that an obligation will not be paid and a loss will result. Credit scoringA statistical technique wherein several financial characteristics are combined to form a single Credit spreadRelated:Quality spread Credit TermsConditions under which credit is extended by a lender to a borrower. Credit UnionCredit unions are community based financial co-operatives and most offer a full range of services. All are owned and controlled by members who are also shareholders. Credit unions are regulated provincially and insured by a stabilization fund, deposit insurance or guarantee corporation. Crediting rateThe interest rate offered on an investment type insurance policy. CreditorLender of money. CreditorPerson or business that is owed money. Creditor (Credit Insurance)A lender or lending institution that offers financing and loans to a borrower, for the purpose of acquiring a commodity. Creditor Proof ProtectionThe creditor proof status of such things as life insurance, non-registered life insurance investments, life insurance RRSPs and life insurance RRIFs make these attractive products for high net worth individuals, professionals and business owners who may have creditor concerns. Under most circumstances the creditor proof rules of the different provincial insurance acts take priority over the federal bankruptcy rules. CreditorsPurchases of goods or services from suppliers on credit to whom the debt is not yet paid. Or a Critical Illness Insurance (Credit Insurance)Coverage that provides a lump-sum payment should you become seriously ill with a specified illness. The payment is made to your creditors to pay off your debt owing. Cumulative preferred stockPreferred stock whose dividends accrue, should the issuer not make timely Debt (Credit Insurance)Money, goods or services that someone is obligated to pay someone else in accordance with an expressed or implied agreement. Debt may or may not be secured. Deferred-annuitiesTax-advantaged life insurance product. Deferred annuities offer deferral of taxes with the Deferred AnnuityAn annuity providing for income payments to commence at a specified future time. Deferred callA provision that prohibits the company from calling the bond before a certain date. During this deferred compensationpay related to current performance Deferred equityA common term for convertible bonds because of their equity component and the Deferred futuresThe most distant months of a futures contract. A bond that sells at a discount and does not Deferred Income Tax ExpenseThat portion of the total income tax provision that is the result Deferred nominal life annuityA monthly fixed-dollar payment beginning at retirement age. It is nominal Deferred Tax AssetFuture tax benefit that results from (1) the origination of a temporary difference Deferred Tax LiabilityFuture tax obligation that results from the origination of a temporary Deferred taxesA non-cash expense that provides a source of free cash flow. Amount allocated during the Demand line of creditA bank line of credit that enables a customer to borrow on a daily or on-demand basis. Disability Insurance (Credit Insurance)Group Insurance designed to cover monthly obligations due to a borrower being unable to work due to sickness or injury. EBDDT - Earnings before depreciation and deferred taxesThis measure is used principally by engineered costa cost that has been found to bear an observable EurocreditsIntermediate-term loans of Eurocurrencies made by banking syndicates to corporate and Evergreen creditRevolving credit without maturity. expired costan expense or a loss Export Credit InsuranceThe granting of insurance to cover the commercial and political risks of selling in foreign markets. Federal credit agenciesAgencies of the federal government set up to supply credit to various classes of Five Cs of creditFive characteristics that are used to form a judgement about a customer's creditworthiness: Floating-rate preferredPreferred stock paying dividends that vary with short-term interest rates. Foreign tax creditHome country credit against domestic income tax for foreign taxes paid on foreign Formalized Line of CreditA contractual commitment to make loans to a particular borrower up to a specified maximum during a specified period, usually one year. Freddie Mac (Federal Home Loan Mortgage Corporation)A Congressionally chartered corporation that Full Credit PeriodThe period of trade credit given by a supplier to its customer. Full faith-and-credit obligationsThe security pledges for larger municipal bond issuers, such as states and Government sponsored enterprisesPrivately owned, publicly chartered entities, such as the Student Loan High-Powered MoneySee money base. in the redMaking a loss. Insurance Policy (Credit Insurance)A policy under which the insurance company promises to pay a benefit of the person who is insured. InsuredThis is the person covered by the life insurance policy. Upon this person's death, a tax free benefit will be paid to that person's estate or a named beneficiary. InsuredPerson whose life is protected under a specific policy. Insured bondA municipal bond backed both by the credit of the municipal issuer and by commercial Insured MortgageAn insured mortgage protects only the mortgage lender in case you do not make your mortgage payments. This coverage is provided by CMHC [Canada Mortgage and Housing Corporation] and is required if a person has a high-ratio mortgage. [A mortgage is high-ratio if the amount borrowed is more than 75% of the purchase price or appraised value, whichever is less.] Insured plansDefined benefit pension plans that are guaranteed by life insurance products. Related: noninsured plans Insured Retirement PlanThis is a recently coined phrase describing the concept of using Universal Life Insurance to tax shelter earnings which can be used to generate tax-free income in retirement. The concept has been described by some as "the most effective tax-neutralization strategy that exists in Canada today." Investment tax creditProportion of new capital investment that can be used to reduce a company's tax bill Investment Tax CreditA reduction in taxes offered to firms to induce them to increase investment spending. Job Loss Insurance (Credit Insurance)Coverage that can pay down your debt should you become involuntarily unemployed. The payment is made to your creditors to reduce your debt owing. Labour-Sponsored Venture FundsVenture capital corporations established by labour unions. They function as other venture capital corporations but are subject to government regulation. Lease (Credit Insurance)Contract granting use of real estate, equipment or other fixed assets for a specified period of time in exchange for payment. The owner or a leased property is the lessor and the user the lessee. Lender (Credit Insurance)Individual or firm that extends money to a borrower with the expectation of being repaid, usually with interest. Lenders create debt in the form of loans. Lenders include financial institutions, leasing companies government lending agencies and automobile dealers. Letter of credit (L/C)A form of guarantee of payment issued by a bank used to guarantee the payment of Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit. |