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Файл:Английский для экономистов. Учебное пособие
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Front-end Load
The percentage of the purchase price that is charged and deducted from the
investment. Same as Sales Charge. For example, if you invest $1000 in a 4% front-
end load mutual fund, you only purchase $960 worth of shares.
Futures
Investment contracts which specify the quantity and price of a commodity to be
purchased or sold at a later date. On contract date, the buyer must take physical
possession or make delivery of the commodity, which can only be avoided by
closing out the contract(s) before that date. Futures can be used for speculation or
hedging.
General Obligation Bond
A municipal bond which is backed by the full faith and credit of a municipality. It
includes the authority to raise taxes and/or borrow to pay back interest and
principal.
Ginnie Mae
Nickname for Government National Mortgage Association (GNMA), a wholly-
owned corporation of the U.S. Government that functions as part of the
Department of Housing and Urban Development (HUD). Also means a security
that represents a pool of mortgages exceeding $1 million that is packaged from
individual home mortgages and resold to investors who receive both principal and
interest, just like a bank that holds a home mortgage. These securities are liquid
and U.S. Government insured.
Glamour Stock
A stock with a wide public and institutional following. You may want to avoid
investing in these stocks because they are over-hyped and extremely vulnerable to
a downward slide.
Global Bonds
Mutual fund investing primarily in debt obligations (i.e. bonds) of foreign
governments and/or corporations. Global bond funds can also be subject to foreign
currency exchange risks.
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Global Equities
Stocks purchased from companies all over the world, including the Unites States.
Global equities can also expose you to foreign currency risk.
Gold
A precious metal usually sought after during times of rapidly rising inflation. For
mutual fund investors, gold can also refer to the stock of gold mining companies,
as well as bullion.
Government Bonds
Mutual fund investing primarily in debt obligations (i.e. bonds) of the U.S.
government. Government bond funds can be short-term, intermediate-term or long-
term, reflecting the average maturity of the bonds held in the portfolio.
Gross Domestic Product (GDP)
A measure of the economy which includes the value of all products and services
produced by a nation in a given year. The growth rate of GDP is used to compare
the economic progress of various nations.
Growth & Income
A security purchased for long-term price appreciation (similar to long-term
growth) and also for potential dividend (or interest) income.
Growth Rate
The percentage rate of change in some financial characteristic of a company. See
Historical 5-year Growth Rate, Projected 5-year Growth Rate, Dividend Growth
Rate, Sales 3-year Growth Rate, and Net Income 3-year Growth Rate.
Hedging
An investment strategy of lowering risk by buying securities that have offsetting
risk characteristics. A perfect hedge eliminates risk entirely. Hedging strategies
lower return since there is a cost involved in hedging. For example, a portfolio
manager could short a futures contract which will perfectly offset any decrease in
the value of the portfolio. Options and short selling stock can also be used for
hedging. Hedge funds are investment pools that are free to use any hedging
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techniques they desire and they often make large bets in a relatively small number
of different holdings.
Hidden Asset
An asset that is omitted or understated in the balance sheet of a company.
Discovering hidden assets before the market does can lead to appreciable price
gains for savvy investors.
High Flyer
A highly speculative stock with a rising price and high volatility which makes it
vulnerable to dramatic crashes.
Holding
All the shares (mutual funds & stocks), contracts (options), or face amount (bonds)
you own of an investment.
Hybrid Investment
An investment which has the major characteristics of two or more other
investments. For example, a convertible preferred stock generally pays a steady
dividend and has steady principal like a high quality corporate bond, but it can be
converted into common stock. Hybrids can be complicated to understand and are
best left to sophisticated investors.
Imputed Interest
Interest which is not actually paid to bond holders but which the IRS may tax
anyway. Common with zero coupon bond interest.
In-The-Money Option
A call option is in-the-money if the strike price is less than the market price of the
underlying security. A put option is in-the-money if the strike price is greater than
the market price of the underlying security.
Income
Dividends or interest received by owners of equity or bonds respectively.
Dividends represent a portion of earnings paid to shareholders while interest is
compensation to bondholders in the form of cash or more bonds for the lending of
capital. Reinvested income can significantly add to returns. See Projected Income.
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Income Account
An account that receives interest from bonds and credit balances, or dividends
from stock positions.
Indexing
Constructing a portfolio to match the performance of a specific index, such as the
S&P 500. Individuals can do this by purchasing shares in an index mutual fund.
Indices
Click Dow Jones Indices and S&P Indices in the Glossary list for these definitions.
Inflation - CPI
The rise in price of goods and services, or Consumer Price Index (CPI), when too
much money chases too few goods on the market. Moderate inflation is a result of
economic growth. Hyperinflation (CPI rising at rates of 100% or more annually)
causes people to lose confidence in their economy and put their money in hard
assets such as gold and real estate.
Inflation Rate
The annual percentage change in the price of goods and services. At the consumer
level, it is the Consumer Price Index (CPI) and at the wholesale level it is the
Producer Price Index (PPI).
Information
See Stock Information for these definitions.
Institution
The name of the institution issuing a CD or money market.
Institutions Holding
The percentage of outstanding shares held by institutions for investment purposes.
Includes charitable trusts, pension funds, mutual funds, brokerage firms, and
banks.
Interest
Compensation to bondholders in the form of cash or more bonds for the lending of
capital. Accumulated or accrued interest is the interest due to the seller of a bond
from the day after the last interest payment to the day before the settlement date. It
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is paid by the buyer of the bond. Imputed interest is not paid to the bondholder but
it is calculated as if it was so that taxes can be paid on it anyway. Reinvested
interest can significantly add to returns.
Interest Dates
Displays the frequency and dates that interest on a given bond is paid. By carefully
selecting interest dates, you can receive income monthly from a group of bonds,
with staggered interest dates.
Intermediate Government Bonds
A U.S. government debt instrument having a maturity of between 3 to 10 years.
International Equities
Stocks purchased from companies based in countries other than the Unites States.
International equities can also expose you to foreign currency risk.
Investment
An appreciating or income producing asset. An open investment is one you
currently own. A closed investment is one you once owned. A long investment is
an open investment that you bought. A short investment is an open investment that
you sold short - i.e., you borrowed the investment from someone else, sold it,
pocketed the proceeds, you hope it decreases in value, and you are obliged to buy it
back in the future and return it to the original owner. An investment can be short
and long at the same time if it contains both long and short lots. All investments
are classified by type as a way of organizing your investments.
Issuer
The official name of the company issuing a given bond.
Jumbo CD
A certificate of deposit with a high minimum deposit required, often $90,000 or
more. They carry a slightly higher interest rate; however, if the value of the CD
plus interest held in the account exceeds $100,000, this excess is not insured by the
FDIC. To be safe, you can hold several jumbo CDs at different banks.
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Junk Bond
A junk bond (or high-yield bond) is one with a S&P credit rating of BB or lower
and that carries higher risk of interest or principal default than better rated
investment grade bonds. Junk bonds are issued in leveraged buyouts and other
takeovers by companies without long track records of sales and earnings, or by
those with questionable credit strength.
Keogh Plan
Tax-deferred pension account designated for employees of unincorporated
businesses or for persons who are self-employed, either full -time or part-time.
Kicker
A provision for equity participation which is often added to a new debt issue to
make it more attractive in the market. Rights, warrants, and convertibility are
common examples. Also called sweeteners.
Leverage
A company is leveraged when it has a high ratio of debt to equity. If the company
can use the extra debt to expand and generate more than enough additional revenue
to cover the higher interest costs, then the leverage is beneficial to the current
shareholders, that is, each share has been leveraged.
Limit Order
Order that sets a specific price (Limit Price) that is the highest a buyer will pay or
the lowest a seller wants to receive. Buyer will accept price lower than limit and
seller higher than limit. It may be a Day or GTC (Good Until Canceled) order. If
no price is indicated, the order is a market order by default.
Limited Partnership
A business or investment where limited partners provide capital, share in profits,
have limited legal liability, and leave the management of the business to general
partners. Can be tradable and listed on an exchange, packaged and sold by brokers
and not exchange tradable, or tradable to other partners only. REITS (real estate
investment trusts) are popular LPs. Most LPs provide both income and
appreciation. Some are highly liquid and others not.
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Liquidity
The ability to turn an asset into cash. A highly liquid asset is easy to sell because
an active market exists that sets prices which are continuously adjusted for supply
and demand. An example is a listed stock or mutual fund. A less liquid asset is real
estate or a collectible.
Loan Value
Maximum percentage of current market value of margin eligible securities that a
brokerage firm can lend a margin account client.
Long Investments
Long investments are investments that you have bought with the goal of price
appreciation and/or income generation. Short investments, on the other hand, are
first sold and then bought back.
Long-Term Growth
Securities whose price appreciation is anticipated over the long term; i.e., a year or
more. Long-term growth securities tend to be more stable and appreciate at a
slower, albeit steadier rate than do maximum capital gains securities.
Lot
A group of identical UNITS (for securities) or nearly identical units (for
collectibles) of an investment that are traded at the same time and price. Open lots
are the contents of open investments and can be long (buys) or short (short sell).
Closed lots are the contents of closed investments and can be long (sell) or short
(buy to cover).
Margin Account
An investment account which allows you to purchase securities with funds
borrowed from the broker at a specified interest rate.
Margin Balance
A debit in your account secured with stocks and/or bonds which regulators have
authorized for use as collateral.
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Margin Debt
A debit in your account that is owed to the broker. The debit is secured with stocks
and bonds which regulators have authorized for use as collateral. It excludes funds
due which are debits resulting from purchases in a cash account.
Margin Loan Availability
The amount of money you may withdraw from your account using margin eligible
securities in your margin account as collateral.
Marginal Tax Rate
The combined federal, state, and local tax rate applied to the next additional dollar
of income. For example, if your federal tax bracket is 28%, and your state tax rate
is 5%, when you earn another dollar of income, it would be taxed at a 33% tax rate.
Market Order
An order to buy or sell a security at the next available price.
Market Timing
Attempting to buy and sell securities to ride up trends and avoid down trends in the
stock, bond, currency, or commodity markets. In theory, this can dramatically
increase your rate of return, but practically, it is extremely difficult or impossible
to consistently make the right decisions at the right time over the long term.
Market Value
The number of outstanding common shares of a given corporation times latest
price per share. It is also referred to as market capitalization.
Note: ADRs and ADSs do not display Market Value.
Maturity
The date a given bond will mature and pay off its principal in full. A bond issued
for $1,000 will pay off the $1,000 at maturity. A single company can issue more
than one series of bonds. These bond series can be differentiated by their
maturities.
Maximum Capital Gains
The attempt to maximize the positive difference between the buying and selling
price of a security. Maximum capital gains securities are typically more risky, or
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volatile, than the average (S&P 500) security. They rise more during bull markets
but also fall more during bear markets and are typically stocks of fast-growing
small companies.
Minimum Deposit
The minimum deposit accepted by the Institution for the particular CD. Jumbo and
MiniJumbo CDs indicate minimum deposits of $100,000 for Jumbos and $25,000
and $50,000 for MiniJumbos.
Minimum Investment
Minimum Initial indicates the minimum deposit required to open a regular or
IRA/SEP/Keogh tax-deferred account with the mutual fund. Minimum subsequent
indicates the minimum required to make deposits in an already opened regular or
tax-deferred account with the mutual fund.
Mixed Lot
The combination of round lot (100 shares) or multiple round lots and an odd lot (99
shares or less), e.g. 163 shares.
Money Market Fund
A mutual fund that invests in cash and equivalents. Generally, has a stable $1 per
share net asset value (NAV) and a variable rate of return. Not federally insured but
short term nature of investments plus private insurance make them quite safe.
Dividends are paid periodically and are automatically reinvested in more shares.
Available from banks, mutual fund companies, and brokerage firms, these funds
are used as a convenient place to park cash and earn "interest" (really dividends, as
mentioned above). Most brokerage and mutual accounts have an associated money
market fund account. Money market funds can be taxable or tax-exempt. Each day,
the balance in the cash / margin account, which comes from the proceeds of trades
and distributions, is swept into the money market fund. See Account.
Municipal Bond
A bond issued by state or local government. Interest from these bonds is generally
tax-free to residents but in some cases, interest is federally taxable if subject to
Alternative Minimum Tax. Note that any capital gain realized by trading a
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municipal bond is subject to capital gains tax. Because of this hybrid tax situation,
municipal bonds are normally put in taxable brokerage accounts since there is no
special account for them. See Bonds.
Mutual Fund Cash Level
Measures the average percentage of cash held by managers of mutual funds in their
funds. When levels are over 11%, managers are holding onto a lot of cash because
they are bearish on the market. Levels below 6% means they are bullish as they
have spent all their cash; fund managers usually need to keep about 5% cash just to
meet daily redemption requirements. This indicator is usually considered a
contrary indicator, as fund managers tend to be wrong at market extremes.
NASDAQ Composite Index
A market value weighted index comprised of about 3,500 stocks traded on the
NASDAQ exchange. Large technology stocks have a major effect on this index
value. NASDAQ represents the top tier of the over-the-counter (OTC) market.
Net Amount
Quantity times price, plus or minus commission.
Net Asset Value (NAV)
The per share price of a mutual fund. For a no-load fund, NAV is the price
received by both buyers and sellers. For front loaded mutual funds, NAV is
equivalent of the bid price (what shareholders can get for selling a share), while the
offering price is the price buyers must pay per share (and includes front load). The
NAV is usually calculated at the end of each trading day by taking the closing
prices of all securities owned plus cash and equivalents and subtracting all
liabilities then dividing by the number of shares outstanding, which for open-end
funds, fluctuates depending on daily number of redemptions and purchases. Many
new funds are issued at a NAV of $10. After a distribution, the NAV falls by the
amount equal to the distribution.
Net Income
The net income after taxes but before payout of common and preferred dividends
for the indicated fiscal year for a given corporation.
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