Term
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Definition
| contingency provisions in bond indentures |
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Term
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Definition
| bonds can be called anytime after the first call date |
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Term
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Definition
| bonds can only be called on the call date specified |
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Term
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Definition
| bonds can be called on specidied dates after the first call days, often on coupon payment dats |
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Term
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Definition
way for bondholders to make extra money. warrants give their holders the right to buy the firms common shares at a given price over a given period of time
CoCos - (euro) convert to CS auto if event occurs |
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Term
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Definition
| bonds that are traded on a when issued basis. such trading prior the offering date of the bonds provides additional info about the deman dor and market clearing price yield |
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Term
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Definition
| IB sell bonds on a commision basis. Do not commit to purchase the whole issue - underwritten offer |
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Term
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Definition
| bond issue is registered w/ securities regulators in its aggregate value w/ a master prosepctus. issued when needed. only for the most financial sound companies |
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Term
| bilateral vs syndicated loan |
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Definition
| funding debt with one bank vs several banks |
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Term
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Definition
| can reduce funding costs with these ST debt securities. Interest cost of commerical paper is less than the interest on a bank loan. Issued with maturities of less than 270 days b/c they are exempt from SEC registration. they are usually rolled rover after maturity but faces rollover risk |
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Term
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Definition
| debt that is temp until perm financing can be secured |
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Term
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Definition
| represent the most recent issue in a specific maturity |
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Term
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Definition
Discount rate appropriate for discounting a bonds CFs
if > CR, trading at a discount |
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Term
| Spot rates (fixed income) |
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Definition
| market discount rates for a single payment to be received in the future. The DR fo 0 CR bonds are spot rates |
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Term
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Definition
| = full price - accrued interest |
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Term
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Definition
| yield spreads relative to swap rates (aka interpolated spreads) |
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Term
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Definition
| solvency is ability to meet long term obligations. liquidity is for ST |
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Term
| basic earnings vs diluted earnings |
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Definition
| basic - calculated using the weighted avg # of common shares. Diulted used the hypothetical amount, had stock options or convertible bonds been cashed in |
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Term
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Definition
futures exchange min price set
They ALSO set daily price move limit, settlement and trading times |
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Term
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Definition
| shareholders can buy at a discount to market. but not fond of because if dont buy, stocks are diluted |
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Term
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Definition
| capital flows freely across borders |
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Term
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Definition
| represent ownership in a foregin firm and are traded in the markets of other countries in local market currencies |
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Term
| sponsored vs unsponsored Depository Reciepts |
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Definition
| Voting rights vs bank keeps votes |
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Term
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Definition
| the return on invested capital minus its cost |
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Term
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Definition
MV of all a firms outstanding securities minus cash and short term investments
common stock value can be est by subtrcting the value of Liabilities and preferred stock from an estimate of enterprise value |
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Term
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Definition
CFO - FCInv + Net Borrowing
**Net Borrowing = amt borrowed minus amt repaid (& is assumed to be available to shareholders) |
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Term
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Definition
| (1 - divivdend payout ratio) x ROE |
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Term
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Definition
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Term
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Definition
| bonds outside their currency and demoniated in a different currency |
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Term
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Definition
| refers to unsecured debt in the US. In GB and some others refers to collateralized by specific assets |
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Term
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Definition
| simliar to asset backed, but they remain on the BS of isseing |
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Term
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Definition
| the bonds can be called on specified dates adter the dist call date, often on coupon payment dates |
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Term
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Definition
| bond issue is restered with securities reulators in its aggregate vale with a master prospectus. They can then be issues when funds are needed |
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Term
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Definition
newly issued gov securities of a particular maturity.
Can also be referred to as benchmark because the yields of ther bonds are determined realtive to the benchmark |
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Term
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Definition
| full price minus accrued interest |
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Term
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Definition
| matrix pricing – estimate reqd YTM of bonds by averaging YTM of similarly credit rated bonds |
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Term
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Definition
upper and lower limits on prepay rates to which support traches can absorb
if outside - BROKEN PAC |
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Term
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Definition
| Senior bonds, mezzanine bonds, and subordinated bonds |
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Term
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Definition
| where the collateral is ABS, RMBD, other CDOs and SMBS |
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Term
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Definition
| those where the collateral is a portfolio of credit default swaps on structured securities |
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Term
| positive & negative duration gap |
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Definition
postiive - exposes the investor to market price risk
negative - reinvestment risl |
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Term
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Definition
| Senior bonds, mezzanine bonds, and subordinated bonds |
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Term
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Definition
| where the collateral is ABS, RMBD, other CDOs and SMBS |
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Term
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Definition
| those where the collateral is a portfolio of credit default swaps on structured securities |
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Term
| positive & negative duration gap |
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Definition
postiive - exposes the investor to market price risk
negative - reinvestment risl |
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Term
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Definition
| default risk x loss severity |
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Term
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Definition
| the rank of all debt in the same category |
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