Term
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Definition
| the most basic form of ownership for a corporation |
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Term
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Definition
| money received from the sale of shares of ownership in a business |
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Term
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Definition
| a distribution of money, stock, or other property that a corporation pays to stockholders |
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Term
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Definition
| a legal form that lists the issues to be decided at a stockholders' meeting and requests that stockholders transfer their voting rights to some individual or individuals |
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Term
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Definition
| the date on which a stockholder must be registered on the corporation's books in order to receive dividend payments |
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Term
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Definition
| a situation when a stock trades "without dividend," and the seller - not the buyer - is entitled to declare dividend payment |
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Term
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Definition
| a procedure in which the shares of stock owned by existing stockholder are divided into a larger number of shares |
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Term
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Definition
| a type of stock that gives the owner the advantage of receiving cash dividends before common stockholders are paid any dividends |
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Term
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Definition
| a situation in which stocks are trading at prices above their actual worth |
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Term
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Definition
| a corporation's after-tax income divided by the number of outstanding shares of a firm's common stock |
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Term
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Definition
| the price of a share of stock divided by the corporation's earning per share of stock |
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Term
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Definition
| the percentage of a firm's earnings paid to stockholders in cash |
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Term
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Definition
| the annual dividend amount generated by the investment's current price per share |
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Term
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Definition
| a calculation that includes the annual dollar amount of dividends as well as any increase or decrease in the original purchase price of the investment |
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Term
| annualized holding period yield |
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Definition
| a yield calculation that takes into account the total return, the original investment, and the time the investment is held |
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Term
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Definition
| a measure that compares the volatility associated with a specific stock issue with the volatility of the Standard & Poor's 500 Stock Index |
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Term
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Definition
| determined by deducting all liabilities from the corporation's assets and dividing the remainder by the number of outstanding shares of common stock |
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Term
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Definition
| the current market value of one share of stock divided by the book value for one share of stock |
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Term
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Definition
| an investment practice based on the assumption that a stock's intrinsic or real value is determined by the company's future earnings |
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Term
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Definition
| an investment practice based on the assumption that a stock's market value is determined by the forces of supply and demand in the stock market as a whole |
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Term
| efficient market hypothesis (EMH) |
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Definition
| an investment theory based on the assumption that stock price movements are purely random |
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Term
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Definition
| a market in which an investor purchases financial securities, via an investment bank or other representative, from the issuer of those securities |
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Term
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Definition
| a financial firm that assists corporations in raising funds, usually by helping to sell new security issues |
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Term
| initial public offering (IPO) |
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Definition
| occurs when a corporation sells stock to the general public for the first time |
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Term
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Definition
| a market for existing financial securities that are currently traded among investors |
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Term
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Definition
| a marketplace where member brokers who represent investor meet to buy and sell securities |
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Term
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Definition
| buys or sells a particular stock in an effort to maintain an orderly market |
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Term
| over-the-counter (OTC) market |
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Definition
| a network of dealer who buy and sell the stocks of corporations that are not listed on a securities exchange |
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Term
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Definition
| an electronic marketplace for approximately 3,200 different stocks |
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Term
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Definition
| a licensed individual who buys or sells securities for clients; also called a stockbroker |
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Term
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Definition
| a request to buy or sell a stock at the current market value |
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Term
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Definition
| a request to buy or sell a stock at a specified price or better |
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Term
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Definition
| an order to sell a particular stock at the next available opportunity after its market price reaches a specified amount |
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Term
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Definition
| a long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals |
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Term
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Definition
| a plan that allows stockholders to purchase stock directly from a corporation without having to use an account executive or a brokerage firm |
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Term
| dividend reinvestment plan |
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Definition
| a plan that allows current stockholders the option to reinvest or use their cash dividends to purchase stock of the corporation |
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Term
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Definition
| an individual who buys and then later sells stocks and other securities in a very short period of time |
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Term
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Definition
| a speculative technique whereby an investor borrows part of the money needed to buy a particular stock |
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Term
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Definition
| selling stock that has been borrowed from a brokerage firm and must be replaced a later date |
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Term
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Definition
| the right to buy or sell a stock at a predetermined price during a specified period of time |
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Term
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Definition
| a corporation's written pledge to repay a specified amount of money with interest |
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Term
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Definition
| the dollar amount the bondholder will receive at the bond's maturity |
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Term
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Definition
| for a corporate bond, the date on which the corporation is to repay the borrowed money |
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Term
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Definition
| a legal document that details all of the conditions relating to a bond issue |
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Term
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Definition
| a bond that is baked only by the reputation of the issuing corporation |
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Term
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Definition
| a corporate bond secured by various assets of the issuing firm |
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Term
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Definition
| an unsecured bond that gives bondholders a claim secondary to that of other designated bondholders with respect to interest payments, repayment, and assets |
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Term
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Definition
| a bond that can be exchanged, at the owner's option, for a specified number of shares of the corporation's common stock |
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Term
| convertible corporate note |
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Definition
| legal debt that is convertible to shares of common stock at the investor's option |
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Term
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Definition
| corporate bonds that pay higher interest, but also have a higher risk of default |
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Term
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Definition
| a feature that allows the corporation to call in or buy outstanding bonds from current bondholders before the maturity date |
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Term
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Definition
| a fund to which annual or semiannual deposits are made for the purpose of redeeming a bond issue |
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Term
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Definition
| bonds of a single issue that mature on different dates |
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Term
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Definition
| a bond that is registered in the owner's name by the issuing company |
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Term
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Definition
| a bond registered for principal only and not for interest |
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Term
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Definition
| a bond that is not registered in the investor's name |
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Term
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Definition
| the rate of return by an investor who holds a bond for a stated period of time - usually a 12-month period |
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Term
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Definition
| a strategy where investors divide their investment dollars among bonds that mature at regular intervals in order to balance risk and return |
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Term
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Definition
| a written pledge of a government of a municipality to repay a specified sum of money, along with interest |
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Term
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Definition
| a debt security issued by a state or local government |
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Term
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Definition
| a bond backed by the full faith, credit, and unlimited taxing power of the government that issued it |
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Term
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Definition
| a bond that is repaid from the income generated by the project it is designed to finance |
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Term
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Definition
| determined by dividing the annual dollar amount of income generated by an investment by the investment's current market value |
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Term
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Definition
| a yield calculation that takes into account the relationship among a bond's maturity value, the time to maturity, the current price, and the dollar amount of interest |
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Term
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Definition
| a fund whose shares are issued by an investment company only when the fund is organized |
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Term
| exchange-traded fun (ETF) |
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Definition
| a fund that generally invests in the stocks or other securities contained in a specific stock or securities index |
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Term
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Definition
| a mutual fund whose shares are issued and redeemed by the investment company at the request of investors |
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Term
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Definition
| the current market value of the securities contained in the mutual fund's portfolio minus the mutual fund's liabilities divided by the number of shares outstanding |
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Term
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Definition
| a mutual fund in which investors pay a commission (as high as 8.5 percent) every time they purchase sales |
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Term
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Definition
| a mutual fund for which the individual investor pays no sales charge |
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Term
| contingent deferred sales load |
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Definition
| a 1 to 5 percent charge that shareholders pay when they withdraw their investment from a mutual fund |
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Term
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Definition
| a fee that an investment company levies to defray the costs of distribution and marketing a mutual fund and commissions paid to a broker who sold you shares in the mutual fund |
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Term
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Definition
| all the different management fees, 12b-1 fees, if any, and additional fund operation costs for a specific mutual fund |
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Term
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Definition
| a group of mutual funds managed by one investment company |
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Term
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Definition
| the earnings a fund pays to shareholders from its dividend and interest income |
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Term
| capital gain distributions |
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Definition
| the payments made to a fund's shareholders that result from the sale of securities in the fund's portfolio |
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Term
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Definition
| the percentage of a fund's holdings that have changed or "been replaced" during a 12-month period |
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Term
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Definition
| a service provided by an investment company in which income dividends and capital gain distributions are automatically reinvested to purchase additional shares of the fund |
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Term
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Definition
| investment in which the investor holds legal title to property |
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Term
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Definition
| investment in which a trustee holds legal title to property on behalf of the investors |
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Term
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Definition
| land and buildings that produce lease or rental income |
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Term
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Definition
| a business or trade in which the investor does not materially participate |
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Term
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Definition
| the total amount of losses from a passive activity minus the total income from the passive activity |
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Term
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Definition
| a temporary association of individuals or firms organized to perform a specific task that requires a large amount of capital |
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Term
| real instate investment trust (REIT) |
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Definition
| a firm that pools investor funds and invest them in real estate or uses them to make construction or mortgage loans |
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Term
| participation certificate (PC) |
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Definition
| an equity investment in a pool of mortgages that have been purchased by a government agency, such as Ginnie Mae |
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Term
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Definition
| rare coins, works of art, antiques, stamps, rare books, and other items that appeal to collectors and investors |
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Term
| reverse annuity mortgage (RAM) |
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Definition
| a mortgage in which the lender uses the borrower's house as collateral to buy an annuity for the borrower from a life insurance company; also called an equity conversion |
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Term
| defined-contribution plan |
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Definition
| a plan--profit sharing, money purchase, Keogh, or 401(k)--that provides an individual account for each participant; also called an individual account plan |
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Term
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Definition
| a plan under which employees can defer current taxation on a portion of their salary |
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Term
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Definition
| an employee's right to at least a portion of the benefits accrued under an employer pension plan, even if the employee leaves the company before retiring |
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Term
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Definition
| a plan that specifies the benefits the employee will receive at the normal retirement age |
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Term
| individual retirement account (IRA) |
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Definition
| a special account in which the employee sets aside a portion of his or her income; taxes are not paid on the principal or interest until money is withdrawn from the account |
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Term
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Definition
| a plan in which tax-deductible contributions fund the retirement of self-employed people and their employees; also called a self-employed retirement plan |
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Term
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Definition
| a contract that provides an income for life |
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Term
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Definition
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Term
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Definition
| a definite plan for the administration and disposition of one's property during one's lifetime and at one's death |
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Term
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Definition
| the legal declaration of a person's mind as to the disposition of his or her property after death |
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Term
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Definition
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Term
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Definition
| a will that leaves everything to the spouse; also called an "I love you will". |
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Term
| traditional marital share will |
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Definition
| a will in which the grantor leaves one-half of the adjusted gross estate to the spouse |
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Term
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Definition
| the gross estate minus debts and costs |
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Term
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Definition
| a will in which everything passes to the spouse except the exemption ($2,000,000 in 2008 and $3,500,000 in 2009) |
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Term
| stated dollar amount will |
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Definition
| a will that allows you to pass on to your spouse any amount that satisfies your family objectives |
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Term
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Definition
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Term
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Definition
| a will that is usually prepared with an attorney's assistance |
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Term
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Definition
| a person who has been named to receive property under a will |
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Term
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Definition
| a formal will on a preprinted form |
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Term
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Definition
| a person who assumes responsibility for providing children with personal care and managing the deceased's estate for them |
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Term
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Definition
| a person or an institution that holds or manages property for the benefit of someone else under a trust agreement |
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Term
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Definition
| a document that modifies provisions in an existing will |
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Term
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Definition
| a documentary agreement between spouses before marriage |
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Term
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Definition
| a document that enables an individual, while well, to express the intention that life be allowed to end if he or she becomes terminally ill |
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Term
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Definition
| a document that dispenses emotional and spiritual wealth to heirs |
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Term
| durable power of attorney |
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Definition
| a legal document authorizing someone to act on one's behalf |
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Term
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Definition
| the creator of a trust; also called the grantor |
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Term
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Definition
| a legal arrangement through which one's assets are held by a trustee |
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Term
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Definition
| a trust whose terms the trustor retains the rights to change |
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Term
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Definition
| a trust that cannot be altered or ended by its creator |
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Term
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Definition
| a trust that allows married couples to leave everything to each other tax free |
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Term
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Definition
| a trust designed for a couple who do not yet have enough assets to need a credit-shelter trust but may need one one the future |
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Term
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Definition
| a trust that is created and provides benefits during the trustor's lifetime |
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Term
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Definition
| a trust established by the creator's will that becomes effective upon his or her death |
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Term
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Definition
| a trust whose assets are derived at least in part from the proceeds of life insurance |
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Term
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Definition
| any property that has been acquired by either spouse during the marriage |
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Term
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Definition
| a federal tax on the right of a deceased person to transfer property and life insurance at death |
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Term
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Definition
| a tax levied on the right of an heir to receive an estate |
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Term
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Definition
| a federal and state tax on the privilege of making gifts to others |
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