Term
Common stock is difficult to value:
Reason #1 |
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Definition
| not even the promised cash flows are know in advance |
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Term
Common stock is difficult to value:
Reason #2 |
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Definition
| the life of the investment us forever, because the common stock has no maturity |
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Term
Common stock is difficult to value:
Reason #3 |
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Definition
| no way to easily observe the rate of return that the market requires |
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Term
| Special Cases: calculate value for the a stock #1 |
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Definition
| dividend has a zero growth rate |
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Term
| Special Cases: calculate value for the a stock #2 |
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Definition
| dividend grows at a constant rate |
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Term
| Special Cases: calculate value for the a stock #3 |
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Definition
| dividend grows at a non-constant rate |
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Term
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Definition
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Term
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Definition
| an asset with cash flows that grow at a constant rate forever |
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Term
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Definition
| dividend growth rate, the rate at which the value of an investment grows |
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Term
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Definition
| stock's expected cash dividend divided by current price |
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Term
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Definition
| equity without priority for dividends or in bankrupcy |
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Term
| Only shareholders have the right to? |
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Definition
| elect directors who hire management to carry out directives |
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Term
| Cumulative Voting (minority participation) |
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Definition
| procedure which a shareholder may cast all votes for one member of the board of directors |
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Term
| Straight Voting (one at a time) |
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Definition
| procedure which a shareholder cast all votes for each member of the board |
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Term
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Definition
| Nullifies cumulative voting, because of fewer directors being elected at one time |
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Term
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Definition
| makes takeover less likely, because difficult to vote the majority of directors |
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Term
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Definition
| grant of authority by shareholder allowing another individual to vote your shares |
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Term
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Definition
| right to share proportionally in any new stock sold |
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Term
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Definition
| payments by a corporation to shareholders, cash or stock |
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Term
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Definition
| stock with dividend priority over common stock, with fixed div. rate |
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Term
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Definition
| preferred shares have a stated liquidating value |
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Term
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Definition
| the market where new securities are originally sold to investors |
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Term
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Definition
| the market where previously issued securities are traded among investors |
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Term
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Definition
| agent who buys and sells securities from inventory |
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Term
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Definition
| agent who arranges security transactions among investors |
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Term
Licence holder of the NYSE #1:
Designated Market Makers (DMMs) |
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Definition
`NYSE members who act as dealers in particular stocks.
Formally: specialists |
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Term
Licence holder of the NYSE #2:
Floor Brokers |
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Definition
| NYSE members who execute customer buy and sell orders |
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Term
Licence holder of the NYSE #3:
Supplemental Liquidity Providers (SLPs) |
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Definition
| investment firms that are active participants in stocks assigned to them |
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Term
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Definition
| The flow of customer orders to buy and sell securities |
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Term
| Key difference between the NYSE and NASDAQ: #1 |
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Definition
| NASDAQ is a computer network with no physical location |
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Term
| Key difference between the NYSE and NASDAQ: #2 |
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Definition
| NASDAQ has a multiple market maker system rather than a DMM system |
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Term
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Definition
| the highest bid quotes and the lowest ask quotes for a security |
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Term
| (ECN) electronic communications network |
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Definition
| websites that allow intestors to trade directly with one another |
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Term
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Definition
price the dealer is willing to pay
(half the ask price) |
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Term
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Definition
| price the dealer will sell |
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Term
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Definition
| the difference between the bid and ask prices |
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