Financial Definitions; R thru Z

The ever increasing number of investing merchandises and financial services in the marketplace today can be confusing. We have got set together this glossary of financial definitions designed to assist you understand some of the more than common investing and financial terms you may encounter. Your financial advisor can explicate these terms more completely and discourse with you those which are relevant to your situation.

Rally - A lively rise following a diminution in the general terms degree of the market, or in an individual stock.

Record Date - The day of the month on which you must be registered as a shareholder of a company in order to have a declared dividend or, among other things, to vote on company affairs.

Redemption Price - The terms at which a chemical bond may be redeemed before maturity, at the option of the issuing company. Redemption value also uses to the terms the company must pay to name in certain types of preferable stock.

REIT - Real Number Estate Investing Trust, an organisation similar to an investing company in some respects but concentrating its retentions in existent estate investments. The output is generally broad since REITs are required to administer as much as 90% of their income.

Refinancing - Same as refunding. New securities are sold by a company and the money is used to retire existent securities. Object may be to salvage interest costs, widen the adulthood of the loan, or both.

Registered Chemical Bond - A chemical bond that is registered on the books of the issuing company in the name of the owner. It can be transferred only when endorsed by the registered owner.

Registered Competitive Market Maker - Members of the New House Of York Stock Exchange who trade on the flooring for their ain or their firm's account and who have got an obligation, when called upon by an Exchange official, to contract a quote or better the depth of an existent quote by their ain command or offer.

Registered Representative - The adult male or adult female who functions the investor clients of a broker/dealer. In a New House Of York Stock Exchange member organization, a Registered Representative must ran into the demands of the Exchange as to background and knowledge of the securities business. Also known as an Account Executive or Customer's Broker.

Registrar - Usually a trust company or bank charged with the duty of keeping record of the proprietors of a corporation's securities and preventing the issue of more than than the authorised amount.

Registration - Before a public offering may be made of new securities by a company, the securities must be registered under the Securities Act of 1933. A registration statement is filed with the second by the issuer. It must let on to the point information relating to the company's operations, securities, management and intent of the public offering. Before a security may be admitted to dealings on a national securities exchange, it must be registered under the Securities Exchange Act of 1934. The application for registration must be filed with the exchange and the second by the company issuing the securities.

Regular Manner Delivery - Unless otherwise specified, securities sold on the New House Of York Stock Exchange are to be delivered to the purchasing broker by the merchandising broker and payment made to the merchandising broker by the purchasing broker on the 3rd business twenty-four hours after the transaction. Regular manner bringing for chemical bonds is the following business day.

Regulation Deoxythymidine Monophosphate - The federal ordinance government the amount of credit that may be advanced by brokers and dealers to clients for the purchase of securities.

Regulation Uracil - The federal ordinance government the amount of credit that may be advanced by a bank to its clients for the purchase of listed stocks.

Rights - When a company desires to raise more than finances by issuing further securities, it may give its stockholders the opportunity, ahead of others, to purchase the new securities in proportionality to the number of shares each owns. The piece of paper evidencing this privilege is called a right. Because the further stock is usually offered to stockholders below the current market price, rights ordinarily have got a market value of their ain and are actively traded. In most cases they must be exercised within a relatively short period. Failure to exert or sell rights may ensue in pecuniary loss to the holder.

Round Batch - A unit of measurement of trading or a multiple thereof. On the New York Stock Exchange the unit of measurement of trading is generally 100 shares in pillory and $1,000 or $5,000 par value in the lawsuit of bonds. In some inactive stocks, the unit of measurement of trading is 10 shares.

Scale Order - An order to purchase (or sell) a security, that stipulates the sum amount to be bought (or sold) at specified terms variations.

Scripophily - A term coined in the mid-1970's to depict the avocation of collecting old-timer bonds, pillory and other financial instruments. Values are affected by beauty of the certification and the issuer's function in human race finance and economical development.

Seat - A traditional figure-of-speech for a rank on an exchange.

SEC - The Securities and Exchange Commission, established by United States Congress to assist protect investors. The second administrates the Securities Act of 1933, the Securities Exchange Act of 1934, the Securities Act Amendments of 1975, the Trust Indentation Act, the Investing Company Act, the Investing Advisers Act, and the Populace Utility Retention Company Act.

Secondary Distribution - Also known as secondary offering. The redistribution of a block of stock some clip after it have been sold by the issuing company. The sale is handled off the New York Stock Exchange by a securities firm or grouping of firms and the shares are usually offered at a fixed terms related to the current market terms of the stock. Usually the block is a large one, such as as mightiness be involved in the settlement of an estate. The security may be listed or unlisted.

Seller's Option - A peculiar transaction on the New York Stock Exchange that gives the marketer the right to present the stock or chemical bond at any clip within a specified period, ranging from not less than two business years to not more than than 60 days.

Serial Chemical Bond - An issue that maturates in portion at periodical declared intervals.

Settlement - Decision of a securities transaction when a client pays a broker/dealer for securities purchased or presents securities sold and have from the broker the go back of a sale.

Short Covering - Buying stock to return stock previously borrowed to do bringing on a short sale.

Short Position - Stocks, options, or hereafters contracts sold short and not covered as of a particular date. On the NYSE, a tabular matter is issued once a calendar calendar month listing all issues on the Exchange in which there was a short place of 5,000 or more than than shares and issues in which the short place had changed by 2,000 or more shares in the preceding month. Short place also intends the sum amount of stock an individual have sold short and have not covered, as of a peculiar date.

Short Sale - A transaction by a individual who believes a security will worsen and sells it, though the individual makes not ain any. For instance: You instruct your broker to sell short 100 shares of XYZ. Your broker borrows the stock so bringing can be made to the buyer. The money value of the shares borrowed is deposited by your broker with the lender. Sooner or later you must cover your short sale by purchasing the same amount of stock you borrowed for tax return to the lender. If you are able to purchase XYZ at a lower terms than you sold it for, your net income is the difference between the two terms - not counting committees and taxes. But if you have got to pay more than for the stock than the terms you received, that is the amount of your loss. Stock exchange and federal ordinances regulate and bounds the statuses under which a short sale may be made on a national securities exchange. Sometimes people will sell short a stock they already ain in order to protect a paper profit. This is cognize as merchandising short against the box.

SIAC - Securities Industry Automation Corporation, an independent organisation established by the New House Of York and American Stock Exchanges as a jointly owned subordinate to supply automation, information processing, glade and communication theory services.

Sinking Fund - Money regularly put aside by a company to deliver its bonds, unsecured bonds or preferable stock from clip to clip as specified in the indentation or charter.

SIPC - Securities Investor Protection Corporation, which supplies finances for use, if necessary, to protect customers' cash and securities that may be on sedimentation with a SIPC member firm in the event the firm neglects and is liquidated under the commissariat of the SIPC Act. SIPC is not a authorities agency. It is a non-profit membership corporation created, however, by an enactment of Congress.

Specialist - A member of the New House Of York Stock Exchange who have two primary functions: first, to keep an orderly market in the securities registered to the specialist. In order to keep an orderly market, the Exchange anticipates specializers to purchase or sell for their ain account, to a sensible degree, when there is a impermanent disparity between supply and demand; second, the specializer Acts as a broker's broker. When committee brokers on the Exchange flooring have a bounds order, say, to purchase at $50 a stock then selling at $60 - they cannot delay at the station where the stock is traded to see if the terms attains the specified level. They go forth the order with a specialist, who will seek to carry it in the market if and when the stock diminutions to the specified price. At all modern times the specializers must set their customers' interest above their own.

Speculation - The employment of finances by a speculator. Safety of principal is a secondary factor.

Speculator - One who is willing to presume a relatively large hazard in the hope of gain.

Spin Off - The separation of a subordinate or division of a corporation from its parent by issuing shares in a new corporate entity. Shareowners in the parent have shares in the new company in proportionality to their original retention and the sum value stays approximately the same.

Split - The division of the outstanding shares of a corporation into a larger number of shares. A 3-for-1 split by a company with 1 million shares outstanding consequences in 3 million shares outstanding. Each holder of 100 shares before the 3-for-1 split would have got 300 shares, although the proportionate equity in the company would stay the same; 100 parts of 1 million are the equivalent of 300 parts of 3 million. Ordinarily divides must be voted by directors and approved by shareholders.

Stock Exchange - An organized marketplace for securities featured by the centralisation of supply and demand for the transaction of orders by member brokers for institutional and individual investors.

Stock Dividend - A dividend paid in securities rather than in cash. The dividend may be further shares of the issuing company, or in shares of another company (usually a subsidiary) held by the company.

Stockholder of Record - A stockholder whose name is registered on the books of the issuing corporation.

Stock Index Futures - Futures contracts based on market indexes, e.g. New York Stock Exchange Complex Index Futures Contracts.

Stock Heart Symbols - Every corporation whose transactions are reported on the New York Stock Exchange or American Stock Exchange heart or on NASDAQ have been given a alone designation symbol of up to four letters. These symbols abbreviate the complete corporate name and ease trading and heart reporting. Some of the most celebrated symbols are: T(American Telephone & Telegraph), XON (Exxon), gram (General Motors), IBM (International Business Machines), Second (Sears Roebuck), and XRX (Xerox).

Stop Limit Order - A halt order that goes a bounds order after the specified halt terms have been reached.

Stop Order - An order to purchase at a terms above or sell at a terms below the current market. Stop bargain orders are generally used to restrict loss or protect unfulfilled net income on a short sale. Stop sell orders are generally used to protect unfulfilled net income or bounds loss on a holding. A halt order goes a market order when the stock sells at or beyond the specified terms and, thus, may not necessarily be executed at that price.

Street Name - Securities held in the name of a broker instead of a customer's name are said to be carried in "street name." This happens when the securities have got been bought on border or when the client wishings the security to be held by the broker.

Swapping - Selling 1 security and purchasing a similar one almost at the same clip to take a loss, usually for tax purposes.

Syndicate - A grouping of investing bankers who together subvent and administer a new issue of securities or a large block of an outstanding issue.

Technical Research - Analysis of the market and pillory based on supply and demand. The technician surveys terms movements, volume, tendencies and patterns, which are revealed by charting these factors, and attempts to measure the possible consequence of current market action on future supply and demand for securities and individual issues.

Tender Offer - A populace offer to purchase shares from existing stockholders of one public corporation by another public corporation under specified terms good for a certain clip period. Stockholders are asked to "tender" (surrender) their retentions for declared value, usually at a insurance premium above current market price, subject to the tendering of a minimum and upper limit number of shares.

Third Market - Trading of stock exchange listed securities in the over-the-counter market by non-exchange member brokers.

Ticker - A telegraphic system that continuously supplies the last sale terms and volume of securities transactions on exchanges. Information is either printed or displayed on a moving tape after each trade.

Time Value - The portion of an option insurance premium that is in extra of the intrinsical value.

Trader - Individuals who purchase and sell for their ain accounts for short-term profit. Also, an employee of a broker/dealer Oregon financial establishment who specialises in handling purchases and sales of securities for the firm and/or its clients.

Trading Post - The construction on the flooring of the New House Of York Stock Exchange at which pillory or options are bought and sold.

Transfer - This term may mention to two different operations. For one, the bringing of a stock certification from the seller's broker to the buyer's broker and legal change of ownership, normally accomplished within a few days. For another, to enter the change of ownership on the books of the corporation by the transfer agent. When the purchaser's name is recorded, dividends, notices of meetings, proxies, financial reports and all to the point literature sent by the issuer to its securities holders are mailed direct to the new owner.

Transfer Agent - A transfer agent maintains a record of the name of each registered shareowner, his or her address, the number of shares owned, and sees that certifications presented for transfer are properly canceled and new certifications issued in the name of the new owner.

Treasury Stock - Stock issued by a company but later reacquired. It may be held in the company's exchequer indefinitely, reissued to the public, or retired. Treasury stock have no dividends and have no ballot while held by the company.

Turnover Rate - The volume of shares traded in a twelvemonth as a percentage of entire shares listed on an Exchange, outstanding for an individual issue or held in an institutional portfolio.

Underlying - The security that one have the right to purchase or sell according to the terms of an option contract.

Unlisted Stock - A security not listed on a stock exchange.

Up Tick - A term used to denominate a transaction made at a terms higher than the preceding transaction. Also called a "plus-tick." A "zero-plus" tick is a term used for a transaction at the same terms as the preceding trade but higher than the preceding different price. Conversely, a down tick, or "minus" tick, is a term used to denominate a transaction made at a terms lower than the preceding trade. A plus sign, or a subtraction sign, is displayed throughout the twenty-four hours next to the last terms of each stock at the trading station on the flooring of the New House Of York Stock Exchange.

Variable Annuity - A life insurance policy where the rente insurance premium (a set amount of dollars) is immediately turned into units of measurement of a portfolio of stocks. Upon retirement, the policyholder is paid according to accumulated units, the dollar value of which changes according to the public presentation of the stock portfolio. Its aim is to preserve, through stock investment, the buying value of the rente which otherwise is subject to eroding through inflation.

Volume - The number of shares or contracts traded in a security or an full market during a given period. Volume is usually considered on a day-to-day footing and a day-to-day average is computed for longer periods.

Voting Right - The common stockholders' right to vote their stock in personal business of a company. Preferred stock usually have the right to vote when preferable dividends are in default for a specified period. The right to vote may be delegated by the stockholder to another person.

Warrant - A certification giving the holder the right to purchase securities at a stipulated terms within a specified clip bounds or perpetually. Sometimes a warrant is offered with securities as an incentive to buy.

When Issued - A short word form of "when, as and if issued." The term bespeaks a conditional transaction in a security authorized for issue but not as yet actually issued. All "when issued" transactions are on an "if" basis, to be settled if and when the existent security is issued and the exchange or National Association of Securities Dealers regulations the transactions are to be settled.

Working Control - Theoretically, ownership of 51 percent of a company's vote stock is necessary to exert control. In pattern - and this is particularly true in the lawsuit of a large corporation - effectual control sometimes can be exerted through ownership, individually or by a grouping playing in concert, of less than 50 percent.

Writer - A individual who presumes the duty to sell (call) or purchase (put) the implicit in security at an option's exercising price.

Yield - Also known as return. The dividends or interest paid by a company expressed as a percentage of the current price. A stock with a current market value of $40 a share paying dividends at the rate of $3.20 is said to go back 8 percent ($3.20 $40.00). The current output on a chemical chemical bond is figured the same way.

Yield To Adulthood - The output of a bond to adulthood takes into account the terms price reduction from or insurance premium over the human face amount. It is greater than the current output when the chemical chemical chemical bond is selling at a terms reduction and less than the current output when the bond is selling at a premium.

Zero Coupon Chemical Bond - A bond which pays no interest but is priced, at issue, at a price reduction from its salvation price.

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