|Stock replacement strategy
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Definition of Stock replacement strategy
Stock replacement strategy
A strategy for enhancing a portfolio's return, employed when the futures
A merger or consolidation in which an acquirer purchases the acquiree's stock.
A strategy that uses available information and forecasting techniques to seek a
Publicly traded issues that may be collateralized by mortgages and MBSs.
The second-largest stock exchange in the United States. It trades
Floating rate preferred stock, the dividend on which is adjusted every
A strategy in which the maturities of the securities included in the portfolio are concentrated
The beta of a stock is determined as follows:
A strategy in which a portfolio is constructed so that the maturities of its securities are highly
A passive investment strategy with no active buying and selling of stocks from the
A strategy in which a put and with the same strike price and expiration are either both
These are securities that represent equity ownership in a company. Common shares let an
Value of outstanding common shares at par, plus accumulated retained
A convertible security that is traded like an equity issue because the optioned
The market for trading equities, not including preferred stock.
Ratios that are designed to measure the relative claims of stockholders to earnings
Conflict between bondholders and stockholders
These two groups may have interests in a corporation that
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.
Covered call writing strategy
A strategy that involves writing a call option on securities that the investor
Cumulative preferred stock
Preferred stock whose dividends accrue, should the issuer not make timely
Refers to multi-period cash flow matching.
Direct stock-purchase programs
The purchase by investors of securities directly from the issuer.
Dividend yield (Stocks)
Indicated yield represents annual dividends divided by current stock price.
Employee stock fund
A firm-sponsored program that enables employees to purchase shares of the firm's
Employee stock ownership plan (ESOP)
A company contributes to a trust fund that buys stock on behalf of
Exchange of stock
Acquisition of another company by purchase of its stock in exchange for cash or shares.
Common stock of a company that has an opportunity to invest money and earn more than the
A bond portfolio strategy whose goal is to eliminate the portfolio's risk against a
Import-substitution development strategy
A development strategy followed by many Latin American
Common stock with a high dividend yield and few profitable investment opportunities.
A bond portfolio strategy in which the portfolio is constructed to have approximately equal
Privately placed common stock, so-called because the SEC requires a letter from the purchaser
stocks that are traded on an exchange.
stocks that are traded on an exchange.
Margin account (Stocks)
A leverageable account in which stocks can be purchased for a combination of
New York Stock Exchange (NYSE)
Also known as the Big Board or The Exhange. More than 2,00 common
Non-cumulative preferred stock
Preferred stock whose holders must forgo dividend payments when the
A strategy of using futures for asset allocation by pension sponsors to avoid disrupting the
Passive portfolio strategy
A strategy that involves minimal expectational input, and instead relies on
Passive investment strategy
See: passive management.
Philadelphia Stock Exchange (PHLX)
A securities exchange where American and European foreign
Preferred equity redemption stock (PERC)
Preferred stock that converts automatically into equity at a
A security that ranks junior to preferred stock but senior to common stock in the right to
A security that shows ownership in a corporation and gives the holder a claim, prior to the
Preferred stock agreement
A contract for preferred stock.
Protective put buying strategy
A strategy that involves buying a put option on the underlying security that is
A strategy of introducing into the decision-making process a random element that is
Cost to replace a firm's assets.
The frequency with which an asset is replaced by an equivalent asset.
Current cost of replacing the firm's assets.
Idea that future replacement decisions must be taken into account in selecting
Repurchase of stock
Device to pay cash to firm's shareholders that provides more preferable tax treatment
Reverse stock split
A proportionate decrease in the number of shares, but not the value of shares of stock
A strategy that involves a position in one or more options so that the cost of buying an
Ownership of a corporation which is represented by shares which represent a piece of the corporation's
Payment of a corporate dividend in the form of stock rather than cash. The stock dividend
Formal organizations, approved and regulated by the Securities and Exchange Commission
A firm's repurchase of outstanding shares of its common stock.
An active portfolio management technique that focuses on advantageous selection of
Balance sheet item that includes the book value of ownership in the corporation. It
Stock index option
An option in which the underlying is a common stock index.
Also called the equity market, the market for trading equities.
An option in which the underlying is the common stock of a corporation.
Occurs when a firm issues new shares of stock but in turn lowers the current market price of its
This is a lettered symbol assigned to securities and mutual funds that trade on U.S.financial exchanges.
Holder of equity shares in a firm.
Set of books kept by firm management for its annual report that follows Financial
The residual claims that stockholders have against a firm's assets, calculated by
Running out of inventory.
Structured portfolio strategy
A strategy in which a portfolio is designed to achieve the performance of some
Common stock that has been repurchased by the company and held in the company's treasury.
BOOK VALUE OF COMMON STOCK
The theoretical amount per share that each stockholder would receive if a companyâ€™s assets were sold on the balance sheetâ€™s date. Book value equals:
Earnings per share of common stock
How much profit a company made on each share of common stock this year.
RATE OF RETURN ON STOCKHOLDERSâ€™ EQUITY
The percentage return or profit that management made on each dollar stockholders invested in a company. Hereâ€™s how you figure it:
RATIO OF DEBT TO STOCKHOLDERSâ€™ EQUITY
A ratio that shows which groupâ€”creditors or stockholdersâ€”has the biggest stake in or the most control of a company:
Certificates that signify ownership in a corporation. A share of stock represents a claim on a portion of the companyâ€™s assets.
STOCKHOLDERSâ€™ (OR OWNERSâ€™) EQUITY
The value of the ownersâ€™ interests in a company.
Shares of ownership sold to the public.
No par value stock
stock issued by the company that does not have an arbitrary value (par value) assigned to it.
Stated value stock
stock issued by the company that does not have a par value, but does have a stated value. For accounting purposes, stated value is functionally equivalent to par value.
The total amount of contributed capital and retained earnings; synonymous with shareholdersâ€™ equity.
Shares that were sold to the public but have since been repurchased by the company in the open market. Treasury stock is deducted from the equity section, and is therefore a contraequity account.
Ownership shares issued by a business corporation. A business
stockholders' equity, statement of changes in
Although often considered
A financial security that represents an ownership claim on the
Cost of Common Stock
The rate of return required by the investors in the common stock of
Cost of Preferred Stock
The rate of return required by the investors in the preferred stock of
A type of equity security where holders have a claim on the assets
The amount necessary to duplicate a company's assets at current
a foundation for the compensation plan that addresses the role compensation should play in the organization
an organizational strategy in which company management decides to confront, rather than avoid, competition; an organizational strategy in which company management still attempts to differentiate company
cost leadership strategy
a plan to achieve the position in a
a technique for avoiding competition by distinguishing a product or service from that of competitors through adding sufficient value (including quality and/or features) that customers are willing to pay
Employee Stock Ownership Plan (ESOP)
a profit-sharing compensation program in which investments are made in
an amount that a firm would pay to replace an asset or buy a new one that performs the same functions as an asset currently held
a buffer level of inventory kept on hand by a company in the event of fluctuating usage or unusual delays in lead time
stock appreciation right
a right to receive cash, stock, or a combination of cash and stock based on the difference between a specified dollar amount per share of stock and the quoted market price per share at some future date
a right allowing the holder to purchase shares of common stock during some future time frame and at a specified price
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