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Transferable put right

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Definition of Transferable put right

Transferable Put Right Image 1

Transferable put right

An option issued by the firm to its shareholders to sell the firm one share of its
common stock at a fixed price (the strike price) within a stated period (the time to maturity). The put right is
"transferable" because it can be traded in the capital markets.



Related Terms:

Absolute Right of Return

Goods may be returned to the seller by the purchaser without restrictions.


Appraisal rights

A right of shareholders in a merger to demand the payment of a fair price for their shares, as
determined independently.


computer-aided design (CAD)

a system using computer graphics for product designs


computer-aided manufacturing (CAM)

the use of computers to control production processes through numerically
controlled (NC) machines, robots, and automated assembly systems


computer integrated manufacturing (CIM)

the integration of two or more flexible manufacturing systems through the use of a host computer and an information networking system



Conversion Right

Term life insurance products are offered as non-convertible or convertible to a certain time in the future. The coversion right has a time limit, usually to the policy holder's age 60 or possibly even age 70. This right means that the policy holder has the right to convert their existing policy to another specific different plan of permanent insurance within the specified time period, without providing evidence of insurability. There is a slightly higher cost for a term policy with the conversion priviledge but it is a valuable feature should a policy holder's health change for the worst and continued insurance coverage becomes a necessity.
Most often this right is also granted to individuals covered under employee group benefit policies where individuals leaving the employee group have a limited amount of time, usually anywhere from 30 to 90 days, to convert to a specific permanent individual policy without evidence of insurability.


Covered Put

A put option position in which the option writer also is short the corresponding stock or has
deposited, in a cash account, cash or cash equivalents equal to the exercise of the option. This limits the
option writer's risk because money or stock is already set aside. In the event that the holder of the put option
decides to exercise the option, the writer's risk is more limited than it would be on an uncovered or naked put
option.


Transferable Put Right Image 2

Cum rights

With rights.


Dividend rights

A shareholders' rights to receive per-share dividends identical to those other shareholders receive.


Ex-rights

In connection with a rights offering, shares of stock that are trading without the rights attached.


Ex-rights date

The date on which a share of common stock begins trading ex-rights.


Full-Employment Output

The level of output produced by the economy when operating at the natural rate of unemployment.


Imputation tax system

Arrangement by which investors who receive a dividend also receive a tax credit for
corporate taxes that the firm has paid.


Impute

To assign a value to a good or service in place of a market value that is not available.


Imputed Rent

The value of consumption services obtained by owning one's house rather than having to pay rent.


input-output coefficient

a number (prefaced as a multiplier
to an unknown variable) that indicates the rate at which each
decision variable uses up (or depletes) the scarce resource


Transferable Put Right Image 3

Input-output tables

Tables that indicate how much each industry requires of the production of each other
industry in order to produce each dollar of its own output.


Liquidation rights

The rights of a firm's securityholders in the event the firm liquidates.



National Output

GDP.


Output Gap

The difference between full employment output and current output.


Outright rate

Actual forward rate expressed in dollars per currency unit, or vice versa.
Outsourcing
he practice of purchasing a significant percentage of intermediate components from outside suppliers.


Poison put

A covenant allowing the bondholder to demand repayment in the event of a hostile merger.


Potential Output or Potential GDP

Output produced when the economy is operating at its natural rate of unemployment.


Preemptive right

Common stockholder's right to anything of value distributed by the company.


Property rights

rights of individuals and companies to own and utilize property as they see fit and to receive
the stream of income that their property generates.


Protective put buying strategy

A strategy that involves buying a put option on the underlying security that is
held in a portfolio. Related: Hedge option strategies


Put

An option granting the right to sell the underlying futures contract. Opposite of a call.


Put

An option to sell a stipulated amount of stock or securities within a
specified time and at a fixed exercise price. See Call.



Put an option

To exercise a put option.


Put bond

A bond that the holder may choose either to exchange for par value at some date or to extend for a
given number of years.


Put-call parity relationship

The relationship between the price of a put and the price of a call on the same
underlying security with the same expiration date, which prevents arbitrage opportunities. Holding the stock
and buying a put will deliver the exact payoff as buying one call and investing the present value (PV) of the
exercise price. The call value equals C=S+P-PV(k).


Put option

This security gives investors the right to sell (or put) fixed number of shares at a fixed price within
a given time frame. An investor, for example, might wish to have the right to sell shares of a stock at a certain
price by a certain time in order to protect, or hedge, an existing investment.


Put Option

A contract that gives the holder the right to sell an asset for a
specified price on or before a given expiration (maturity) date


put option

right to sell an asset at a specified exercise price on or before the exercise date.


Put Option

Contract that grants the right to sell at a specified price at some time in the future.


Put price

The price at which the asset will be sold if a put option is exercised. Also called the strike or
exercise price of a put option.


Put provision

Gives the holder of a floating-rate bond the right to redeem his note at par on the coupon
payment date.


Put swaption

A financial tool in which the buyer has the right, or option, to enter into a swap as a floatingrate
payer. The writer of the swaption therefore becomes the floating-rate receiver/fixed-rate payer.


Putaway

The process of moving received items to storage and recording the related
transaction.


Puttable bond

A bond that allows the holder to redeem the bond at a
predetermined price at specified future dates. The bond contains an embedded
put option; i.e., the holder has bought a put option. See Callable bond.


Right

A short-lived (typically less than 90 days) call option for purchasing additional stock in a firm, issued
by the firm to all its shareholders on a pro rata basis.


Right of Return

A sales agreement provision that permits a buyer to return products purchased
for an agreed-upon period of time.


rights issue

Issue of securities offered only to current stockholders.


Rights offering

Issuance of "rights" to current shareholders allowing them to purchase additional shares,
usually at a discount to market price. Shareholders who do not exercise these rights are usually diluted by the
offering. rights are often transferable, allowing the holder to sell them on the open market to others who may
wish to exercise them. rights offerings are particularly common to closed end funds, which cannot otherwise
issue additional common stock.


Rights-on

Shares trading with rights attached to them.


Special drawing rights (SDR)

A form of international reserve assets, created by the IMF in 1967, whose
value is based on a portfolio of widely used currencies.


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


throughput

the total completed and sold output of a plant during a period


Throughput agreement

An agreement to put a specified amount of product per period through a particular
facility. For example, an agreement to ship a specified amount of crude oil per period through a particular
pipeline.


Throughput contribution

Sales revenue less the cost of materials.


Uncovered put

A short put option position in which the writer does not have a corresponding short stock
position or has not deposited, in a cash account, cash or cash equivalents equal to the exercise value of the
put. Also called "naked" puts, the writer has pledged to buy the stock at a certain price if the buyer of the
options chooses to exercise it. The nature of uncovered options means the writer's risk is unlimited.


Uniformed Services Employment and Reemployment Rights Act of 1994

A federal act that minimizes the impact on people serving in the Armed Forces
when they return to civilian employment by avoiding discrimination and increasing
their employment opportunities.


Voting rights

The right to vote on matters that are put to a vote of security holders. For example the right to
vote for directors.


With rights

Purchase of shares in which the buyer is entitled to the rights to buy shares in the company's
rights issue.



 

 

 

 

 

 

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