A professional person who performs accounting functions.

Accounting
To provide a record such as funds paid or received for a person or business. Accounting summarizes and submits this information in reports and statements. The reports are intended both for the firm itself and outside parties.

Accredited Investor
A term used by the SEC under Regulation D to define investors that are financially sophisticated and have no need for the protection provided by certain government filings. Also known as a qualified purchaser.

Acquisition
When one company purchases a majority interest in another business entity.

Acquisition Debt
A debt incurred to construct, improve or acquire a principal or secondary residence.

Activity Based Management - ABM
Using an activity-based costing system to improve the operations of an organization.

ADR (American Depositary Receipt)
A negotiable certificate issued by a U.S. bank representing a specific number of shares of a foreign stock traded on a U.S. stock exchange. ADRs make it easier for Americans to invest in foreign companies, due to the widespread availability of dollar-denominated price information, lower transaction costs, and timely dividend distributions.

AMEX
American Stock Exchange.

Amex listing
The process of having a companies securities eligible for trading on the American Stock Exchange.

AMEX Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

Angel Investor
A financial backer providing venture capital funds for small start-ups or entrepreneurs.

Appraisal
A valuation of property (e.g. real estate, a business, an antique) by the estimate of an authorized person.

Arbitrage
The simultaneous purchase and selling of a security in order to profit from a differential in the price. This usually takes place on different exchanges or marketplaces.

Articles of Incorporation
A set of documents filed with a government body for the purpose of legally documenting the creation of a corporation. Also referred to as the "corporate charter."

Asian Option
An option whose payoff depends on the average price of the underlying asset over a certain period of time as opposed to at maturity. Also known as an average option.

Asset
1. A resource that an individual, corporation, or country owns or controls that has economic value and that is expected to provide future benefit.

2. A balance sheet item representing what a firm owns.

Asset Allocation Fund - AAF
A mutual fund that splits its investment assets among stocks, bonds and other investment vehicles in an attempt to provide a consistent return for the investor. Also referred to as a "diversification fund".

Asset Based Finance
A specialized method of providing structured working capital and term loans that are secured by accounts receivable, inventory, machinery, equipment and/or real estate. This type of funding is great for startup companies, refinancing existing loans, financing growth, mergers and acquisitions, and management buy-outs (MBOs) and buy-ins (MBIs).

Asset Based Lending
A business loan secured by collateral (assets). The loan, or line of credit, is secured by inventory, accounts receivable and/or other balance-sheet assets.

Also known as "commercial finance" or "asset-based financing".

Asset Class
A specific category of assets or investments.

Asset Financing
Using balance sheet assets (such as accounts receivable, short term investments, or inventory) to secure a loan or borrow money.

Asset Management
1. The management of the financial assets of a company in order to maximize return.

2. An account at a financial institution that includes checking services, credit cards, debit cards, margin loans, the automatic sweep of cash balances into a money market fund, as well as brokerage services.

Asset/Liability Management
A technique companies employ in coordinating the management of assets and liabilities so that an adequate return may be earned. Also known as "surplus management."

Australian Stock Exchange - ASX
The stock exchange headquartered in Sydney, Australia.

Authorized Stock
The maximum number of shares that a corporation is legally permitted to issue under its articles of incorporation. This figure is usually listed in the capital accounts section of the balance sheet.

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Back Door Listing
A strategy of going public used by a company that fails to meet the criteria for listing on a stock exchange. To get onto the exchange, the company desiring to go public acquires an already listed company.

Bahrain Stock Exchange - BSE
The stock exchange headquartered in Manama, Bahrain.

Balanced Investment Strategy
A portfolio allocation and management method aimed at balancing risk and return.

Bank
A commercial institution licensed as a receiver of deposits. Banks are mainly concerned with making and receiving payments as well as supplying short-term loans to individuals.

Bankruptcy
The state of a person or firm unable to repay debts.

Barter
The act of trading goods and services without the use of money.

Basis Point - BPS
A unit for measuring a bond's yield that is equal to 1/100th of 1% of yield. Also known as "bips."

Bear Market
A market condition in which the prices of securities are falling or are expected to fall. Although figures can vary, a downturn of 15%-20% or more in multiple indexes (Dow or S&P 500) is considered an entry into a bear market.

Bear Trap
A false signal that the rising trend of a stock or index has reversed when it has not.

Bearer Form
A security not registered in the books of issuing corporation but that is payable to its bearer (the person possessing it). Securities can be issued in two forms: registered or bearer. Registered form means the issuing firm keeps records of a security's owner and mails out payments to him/her. Bearer form means the security is traded without any record of ownership, so physical possession of the security is the sole evidence of ownership. Most securities issued today are in registered form.

Bermuda Stock Exchange - BSX
The stock exchange headquartered in Hamilton, Bermuda.

Blank Check Company
A company in a developmental stage that doesn't have an established business plan or has a business plan that revolves around a merger or an acquisition of another firm.

Blank Check Preferred Stock
A method companies use to simplify the process of creating new classes of preferred stock to raise additional funds from sophisticated investors without obtaining separate shareholder approval.

Blue Chip Stock
Stock of a well-established and financially-sound company that has demonstrated its ability to pay dividends in both good and bad times.

Blue Sky Laws
State regulations designed to protect investors against securities fraud by requiring sellers of new issues to register their offerings and provide financial details. This allows investors to base their judgments on trustworthy data.

Board of Directors - B of D
A group of individuals who are elected by stockholders to establish corporate management policies and make decisions on major company issues, such as dividend policies.

Bolsa Boliviana de Valores - BBV
The stock exchange headquartered in La Paz, Bolivia .

Bond
A debt investment, with which the investor loans money to an entity (company or government) that borrows the funds for a defined period of time at a specified interest rate.

Bond Fund
A mutual fund whose investment objective is to provide stable income while taking on minimal risk.

Bond Rating
A specification of a bond issuer's probability of defaulting based on an analysis of the issuer's financial condition and profit potential.

Book Value per Common Share - refer back to the book
A measure used by owners of common shares in a firm to determine the level of safety associated with each individual share after all debts are paid accordingly.

Bourse
Any European stock exchange.

Boutique
A small investment firm specializing in offering specific, but limited services to a select number of individuals.

Broker
An individual or firm that charges a fee or commission for executing buy and sell orders submitted by an investor.

Broker-Dealer
A person or firm in the business of buying and selling securities operating as both a broker and dealer depending on the transaction.

Brokered Deposit
A large-denomination deposit similar to a certificate of deposit

Brokerage Firm
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Bull
An investor who thinks the market, a specific security or an industry will rise.

Bull Market
A financial market of a certain group of securities in which prices are rising or are expected to rise. The term "bull market" is most often used in respect to the stock market, but really can be applied to anything that is traded, such as bonds, currencies, commodities, etc.

Bull markets are characterized by optimism, investor confidence and expectations that strong results will continue. Of course, no bull market can last forever, and sooner or later a bear market (in which prices fall) will come. It's tough if not impossible to predict consistently when the trends in the market will change. Part of the difficulty is that psychological effects and speculation can sometimes play a large (if not dominant) role in the markets. The extreme on the high end is a stock-market bubble, and on the low end a crash.

Bulletin Board
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

Bulletin Board Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

Business Development Bank of Canada - BDC
A financial institution that is wholly owned by the government of Canada providing financial and consulting services to small Canadian businesses.

Business Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Business Consulting
An act of facilitating organizational change and/or providing subject matter expertise on technical, functional and business topics during development or implementation.

Business Finance
To lend money or finances primarily to businesses

Business Law
Rules that covers all aspect of business or company.

Business Management
Influencing of people to help accomplish the goals of an organization and business. It involves planning, organizing, and guiding employees and activities surrounding these events.

Business to Business - B2B
Business conducted between companies, rather than between a company and individual consumers.

Buy
1. A recommendation to purchase a specific security.

2. To acquire an asset in exchange for currency.

Buy and Hold
A passive investment strategy with which an investor buys stocks and holds them for a long period regardless of fluctuations in the market.

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CUSIP
A number identifying all stocks and registered bonds. The Committee on Uniform Securities Identification Procedures (CUSIP) oversees the entire CUSIP system.

Call
1. The period of time between the opening and closing of some future markets wherein the prices are established through an auction process.

2. An option contract giving the owner the right (but not the obligation) to buy a specified amount of an underlying security at a specified price within a specified time.

Canadian Originated Preferred Securities - COPrS
A long-term subordinated debt instrument, issued in Canada.

Capital
1. Financial assets or the financial value of assets such as cash.

2. The factories, machinery, and equipment owned by a business.

Capital Appreciation
A rise in the market price of an asset.

Capital Asset
A long-term asset that is not bought or sold in the regular course of business.

Capital Asset Pricing
A model describing the relationship between risk and expected return that is used in the pricing of risky securities. CAPM says that the expected return of a security or a portfolio equals the rate on a risk-free security plus a risk premium. If this expected return does not meet or beat the required return then the investment should not be undertaken.

Capital Base
1. The capital acquired during an IPO, or the additional offerings of a company, plus any retained earnings.

2. An initial investment plus subsequent investments made by an investor into their portfolio

Capital Intensive
A process or industry that requires large sums of financial resources to produce a particular good.

Capital Markets
Markets where capital, such as stocks and bonds, are traded.

Capital Note
Fixed income products issued by companies as a source of short term debt.

Capital Share
The class of shares offered by a dual-purpose fund that has opportunity for capital appreciation but does not offer the holder any portion of the fixed income earned within the portfolio.

Capital Stock
The common and preferred stock a company is authorized to issue, according to their corporate charter.

Capital Structure
The means by which a firm is financed.

Capital Surplus
Equity which cannot otherwise be classified as capital stock or retained earnings. It's usually created from a stock issued at a premium over par value.

Capitalism
An economic system based on a free market, open competition, profit motive and private ownership of the means of production. Capitalism encourages private investment and business, compared to a government-controlled economy. Investors in these private companies (i.e. shareholders) also own the firms and are known as capitalists

Capitalization
1. In accounting, it is where costs to acquire an asset are included in the price of the asset.

2. The sum of a corporation's stock, long-term debt and retained earnings. Also known as "invested capital".

3. A company's outstanding shares multiplied by its share price, better known as "market capitalization".

Capitalize
An accounting method used to delay the recognition of expenses by recording the expense as a long-term asset.

Captive Finance Company
A subsidiary whose purpose is to provide financing to customers buying the parent company's product.

Captive Fund
A fund that provides investment services solely to the one firm holding ownership.

Cash Flow
The amount of cash a company generates and uses during a period, calculated by adding non cash charges (such as depreciation) to the net income after taxes. Cash Flow can be used as an indication of a company's financial strength. It is also sometimes referred to as the "money value" of trades in a stock during a trading day.

Cash Flow Return on Investment - CFROI
A valuation model that assumes the stock market sets prices based on cash flow, not on corporate performance and earnings.

Casino Finance
Any investment strategy that is classified as extremely high risk.

CBOE Nasdaq Volatility Index - VXN
A volatility index on the Chicago Board Options Exchange, known by its ticker symbol VXN. The VXN is a measure of implied volatility for the Nasdaq 100 (NDX).

Central Bank
The entity responsible for overseeing the monetary system for a nation (or group of nations). Central banks have a wide range of responsibilities - from overseeing monetary policy to implementing specific goals such as currency stability, low inflation and full employment. Central banks also generally issue currency, function as the bank of the government, regulate the credit system, oversee commercial banks, manage exchange reserves and act as a lender of last resort.

CEO
Chief Executive Officer - This is the senior manager who is responsible for overseeing the activities of an entire company.

CFO
Chief Financial Officer - This is the senior manager who is responsible for overseeing the financial activities of an entire company. This includes signing checks, monitoring cash flow, and financial planning.

Certificated Stock
A stock of commodity that has been inspected by qualified representatives and determined to be of basis grade.

Certificates of Accrual on Treasury Securities
Issued by the U.S. Treasury and stripped by a financial intermediary, these products are sold at a significant discount from face value and pay no interest during their lifetime. However, they return full face value and cannot be called away.

Certified Investment Management Consultant - CIMC
CIMC's have completed extensive course work and passed NASD proctored examinations for Levels I and II of the Institute for Certified Investment Management Consultants' course. CIMCs must also meet the Institute's requirements concerning experience in consulting and managed accounts, and adhere to its Code of Ethics and continuing education requirements.

Certified Public Accountant
A designation by the American Institute of Certified Public Accountants for those who pass an exam and meet work-experience requirements.

Chairman
The highest-ranking officer in a corporation's board of directors. Presides over corporate meetings. Sometimes has executive authority over a firm, sometimes does not.

Chairman of the Board
1. An executive of a company who shares responsibility for the operation of his/her company.
2. The highest-ranking officer in a corporation's board of directors. Presides over corporate meetings. Sometimes has executive authority over a firm, sometimes does not.

Charitable Remainder Trust
A tax-exempt irrevocable trust designed to reduce the taxable income of individuals by first dispersing income to the beneficiaries of the trust for a specified period of time and then donating the remainder of the trust to the designated charity.

Chartered Financial Analyst
A professional designation given by CFA Institute (formerly AIMR) that measures the competence and integrity of financial analysts. Candidates are required to pass three levels of exams covering areas such as accounting, economics, ethics, money management, and security analysis.

Chicago Board of Trade - CBOT
A commodity exchange that trades in both agricultural and financial contracts.

Chief Executive
The executive who is responsible for a company's operations, usually the President or the Chairman of the Board.

Chief Executive Officer
1. An executive of a company who shares responsibility for the operation of his/her company.
2. The executive who is responsible for a company's operations, usually the President or the Chairman of the Board.

Chief Financial Officer
An executive of a company who shares responsibility for the operation of his/her company.

Chief Operating Officer
An executive of a company who shares responsibility for the operation of his/her company.

Chinese Wall
The ethical (not physical) barrier between different divisions of a financial (or other) institution to avoid conflict of interest. A Chinese Wall is said to exist, for example, between the corporate-advisory area and the brokering department to separate those giving corporate advice on takeovers from those advising clients about buying shares. The "wall" is thrown up to prevent leaks of corporate inside information, which could influence the advice given to clients making investments, and allow staff to take advantage of facts that are not yet known to the general public.

Commercial Mortgaged Backed Securities - CMBS
Similar to a Mortgage Backed Security, but secured by loans with commercial property instead of residential property.

Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Consulting Service
The services performed by a consultant.

Corporate
Pertaining to corporations.

Corporate Development
Development of a corporation to achieve specific goals.

Corporate Development Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Corporate Finance
Any financial or monetary activity that deals with a company and its money.

Corporate Finance Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Corporate Governance
1. The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law.
2. A generic term which describes the ways in which rights and responsibilities are shared between the various corporate participants, especially the management and the shareholders.

Corporate Inversion
The act of a parent company, whose headquarters are located within U.S. borders, switching registration with their offshore subsidiary in order to take advantage of foreign tax benefits.

Corporate Officer
An officer of a corporation.

Corporate Services
Services pertaining to corporations.

Corporation
A legal entity that is separate and distinct from its owners. Corporations enjoy most of the rights and responsibilities that an individual possesses; that is, a corporation has the right to enter into contracts, loan and borrow money, sue and be sued, hire employees, own assets and pay taxes.

The most important aspect of a corporation is limited liability. That is, shareholders have the right to participate in the profits, through dividends and/or the appreciation of stock, but are not held personally liable for the company's debts.

Coupon
The interest rate stated on a bond when it's issued. The coupon is typically paid semiannually.

Coupon Bond
A debt obligation with coupons attached that represent semiannual interest payments.

CPA
Certified Public Accountant.

Crossover Fund
An investment fund that invests in both public and private equity.

Currency
Money circulated within an economy, including coins and paper notes.

CUSIP Number
A number identifying all stocks and registered bonds. The Committee on Uniform Securities Identification Procedures (CUSIP) oversees the entire CUSIP system.

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Debt Private Placement
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors

Depository Trust & Clearing Corporation - DTCC
Established in 1999, the DTCC is a holding company consisting of 5 clearing corporations and 1 depository, making it the world's largest financial services corporation dealing in post trade transactions.

Depository Trust Company - DTC
One of the world's largest securities depositories, it holds in excess of $10 trillion worth of securities in custody. The DTC acts like a clearing house to settle trades in corporate and municipal securities.

Direct Public Offering (DPO)
Offering securities directly without a brokerage firm.

Director
An executive of a company who shares responsibility for the operation of his/her company.

Diversified Common Stock Fund
A mutual fund that invests its assets in a wide range of common stocks. The fund's objectives can be growth, income, or a combination of both.

Dividend Enhanced Convertible Stock - DECS
Preferred stock that provides the holder with premium dividends in addition to an embedded short put option and a long call on the issuing company's stock.

Dow Jones Industrial Average
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.

Dow Jones Transportation Average - DJTA
The Dow Jones Transportation Average is a price-weighted average of 20 transportation stocks traded in the United States. The average was started back in 1884.

DPO (Direct Public Offering)
Offering securities directly without a brokerage firm.

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Earnings per Share - EPS
The portion of a company's profit allocated to each outstanding share of common stock.

EBIT
An indicator of a company's financial performance calculated as revenue minus expenses excluding tax and interest. Also referred to as operating earnings.

EBITD
An indicator of a company's financial performance calculated as:
= Revenue - Expenses (excluding tax, interest, and depreciation)

EBITDA
An indicator of a company's financial performance calculated as
= Revenue - Expenses (excluding tax, interest, depreciation, and amortization)

EBITDA can be used to analyze the profitability between companies and industries, because it eliminates the effects of financing and accounting decisions.

EBITDAX
An indicator of a company's financial performance calculated as:
Revenue minus Expenses (excluding tax, interest, depreciation, depletion, amortization, and exploration expenses)

EDGAR
The Securities and Exchange Commission's electronic system. It is used by all publicly-traded companies for submitting their required filings to the SEC.

EDGAR Filing
Electronic data gathering and retrieval system.

Electronic Communication Network - ECN
An electronic system that attempts to eliminate the role of a third party in the execution of orders entered by an exchange market maker or an over-the-counter market maker, and permits such orders to be entirely or partly executed.

Employee Stock Ownership Plan - ESOP
An organized plan for the employees of a company to buy shares of its stock. These plans are becoming increasingly popular.

ERISA
The Employee Retirement Income Security Act of 1974 (ERISA) protects the retirement assets of Americans, by implementing rules that qualified plans must follow to ensure that plan fiduciaries do not misuse plan assets.

Equity
1. Stock or any other security representing an ownership interest.

2. On the balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses). Also referred to as "shareholder's equity".

3. In the context of margin trading, the value of securities in a margin account minus what has been borrowed from the brokerage.

4. In the context of real estate, the difference between the current market value of the property and the amount the property owner still owes on the mortgage. Thus, it is the amount, if any, the owner would receive after selling a property and paying off the mortgage.

Equity Capital
Capital raised from owners.

Equity Offering
An offering of a security (stock).

Equity Private Placement
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors

Eurobank
A financial institution that readily accepts foreign currency denominated deposits and makes foreign currency loans.

Exchange-Traded Fund - ETF
A security that tracks an index and represents a basket of stocks like an index fund, but trades like a stock on an exchange, thus experiencing price changes throughout the day as it is bought and sold.

Exemption
A deduction allowed by law to reduce the amount of income that would otherwise be taxed. An exemption is based on a status or circumstance rather than economic standing.

Exchange Act
The Exchange Act requires publicly held companies to disclose information continually about their business operations, financial conditions, and managements. These companies, and in many cases their officers, directors and significant shareholders, must file periodic reports or other disclosure documents with the SEC. In some cases, the company must deliver the information directly to investors.

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F-10
A form that is filed with the Securities and Exchange Commission.

Finance
Any financial or monetary activity, either debt or equity.

Financial Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Form 10
A form that is filed with the Securities and Exchange Commission.

Form 10-SB
A form that is filed with the Securities and Exchange Commission.

Form 144
A form that must be filed with the SEC when an executive officer, director, or affiliate of a company places an order to sell that company's stock. Also known as Rule 144.

Form 8-K
A form that is filed with the Securities and Exchange Commission.

Forward Triangular Merger
A type of merger that occurs when the subsidiary of the acquiring corporation merges with the target firm.

FTSE
A company that specializes in index calculation. Although not part of a stock exchange, co-owners include the London Stock Exchange and the Financial Times.

Fund Manager
The person responsible for investing a mutual fund's assets, implementing its investment strategy, and managing the day-to-day portfolio trading.

Fund of Funds
A mutual fund that invests in other mutual funds.

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GAAP
The common set of accounting principles, standards and procedures. GAAP is a combination of authoritative standards (set by policy boards) and the accepted ways of doing accounting.

Ginnie Mae
A wholly-owned U.S. government corporation within the U.S. Department of Housing and Urban Development (HUD). The main focus of Ginnie Mae is to ensure liquidity for U.S. government-insured mortgages including those insured by the Federal Housing Administration (FHA), the Veterans Administration (VA) and the Rural Housing Administration (RHA). The majority of mortgages securitized as Ginnie Mae MBS are those guaranteed by FHA. FHA mortgagors are typically first-time home buyers and low-income borrowers.

Global Depository Receipt - GDR
1. A bank certificate issued in more than one country for shares in a foreign company. The shares are held by a foreign branch of an international branch. The shares trade as domestic shares, but are offered for sale globally through the various bank branches.

2. A financial instrument used by private markets to raise capital denominated in either U.S. dollars or Euros.

Going Public
The process of selling shares that were formerly privately held to new investors for the first time. Otherwise known as an initial public offering (IPO).

Government National Mortgage Association - GNMA
A wholly-owned U.S. government corporation within the U.S. Department of Housing and Urban Development (HUD). The main focus of Ginnie Mae is to ensure liquidity for U.S. government-insured mortgages including those insured by the Federal Housing Administration (FHA), the Veterans Administration (VA) and the Rural Housing Administration (RHA). The majority of mortgages securitized as Ginnie Mae MBS are those guaranteed by FHA. FHA mortgagors are typically first-time home buyers and low-income borrowers.

Gross Domestic Product - GDP
This inflation-adjusted measure that reflects the value of all goods and services produced in a given year, expressed in base-year prices. Often referred to as "constant-price", "inflation-corrected" GDP or "constant dollar GDP".

Growth Company
A company that is nearly or completely finished a period of high sales and earnings growth.

Growth Fund
A diversified portfolio of stocks that has capital appreciation as its primary goal, and thereby invests in companies that reinvest their earnings into expansion, acquisitions, and/or research and development.

Growth Industry
A sector of the economy experiencing a higher-than-average growth rate.

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Holding Company
A parent corporation that owns enough voting stock in another corporation to control its board of directors (and, therefore, controls its policies and management).

Horizontal Market
A market diversified so that the products created are able to meet the needs of more than one industry.

Horizontal Merger
A merger occurring between companies producing similar goods or offering similar services.

Horizontal Spread
An options strategy involving the simultaneous purchase and sale of two options of the same type, having the same strike price, but different expiration dates.

Hostile Takeover
A takeover attempt that is strongly resisted by the target firm.

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Index
A statistical measure of change in an economy or a securities market. In the case of financial markets, an index is essentially an imaginary portfolio of securities representing a particular market or a portion of it. Each index has its own calculation methodology and is usually expressed in terms of a change from a base value. Thus, the percentage changes is more important that the actually numeric value. For example, knowing that a stock exchange is at, say, 5000 doesn't tell you much. However, knowing that the index has risen 30% over the last year to 5000 gives a much better demonstration of performance.

Indication of Interest - IOI
An underwriting expression showing a conditional, non-binding interest in buying a security that is currently in registration (awaiting effectiveness by the SEC). The investor's broker is required to provide the investor with a preliminary prospectus.

Indicator
Anything used to predict future financial or economic trends.

Initial Public Offering (IPO)
The first sale of stock by a private company to the public. IPOs are often smaller, younger companies seeking capital to expand their business.

Insider
An executive of a company who shares responsibility for the operation of his/her company.

Instinet
An electronic securities order-matching (trading) and information system that allows members (primarily professional traders and investors) to display bid and offer quotes for stocks, and to transact between themselves using brokers. As a global securities broker, Instinet enables over 1,500 institutional customers to trade securities in over 40 global markets around the world in locations such as London, Paris, Frankfurt, Sydney, Tokyo and others, including the U.S.

International Business Consultant
A person in the International arena facilitates organizational change and/or provides subject matter expertise on technical, functional, and business topics during development or implementation.

International Bond
Bonds that are issued in a country by a non-domestic entity.

International Depository Receipt - IDR
A negotiable, bank-issued certificate representing ownership of stock securities by an investor outside the country of origin.

International Fund
A mutual fund that can invest in companies located anywhere outside of your own country.

International Monetary Fund - IMF
An international organization created for the purpose of:

1. Promoting global monetary and exchange stability.
2. Facilitating the expansion and balanced growth of international trade.
3. Assisting in the establishment of a multilateral system of payments for current transactions.

International Trade Consultant
A person in the International arena facilitates organizational change and/or provides subject matter expertise on technical, functional, and business topics during development or implementation.

International Venture Capital
Venture Capital provided by sources other than those located in the USA.

Investing
The act of committing money or capital to an endeavor (a business, project, real estate, etc.) with the expectation of obtaining an additional income or profit.

Investment
An asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth. In finance, an investment is a monetary asset purchased with the idea that the asset will provide income in the future or appreciate and be sold at a higher price.

Invest Bank
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Investment Bank (IB)
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Investment Banker
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Investment Banking
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Investment Consultant
A person who facilitates organizational change and/or provides subject matter expertise on technical, functional and business topics during development or implementation.

Investor Relations - IR
1. A department, present in most medium to large public companies, that provides investors with an accurate account of the affairs of the company. This helps investors to make informed buy or sell decisions.
2. A department within a public company that distributes information about the company and its financial performance to existing and potential shareholders.

IPO (Initial Public Offering)
The first sale of stock by a private company to the public. IPOs are often smaller, younger companies seeking capital to expand their business.

IPO Consultant (Initial Public Offering Consultant)
A consultant that is involved with companies about to do an IPO.

IPO Consulting
Consulting pertaining to an Initial Public Offering (IPO).

IPO News
The latest news on offerings coming to market.

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Joint Venture
The cooperation of two or more individuals or businesses--each agreeing to share profit, loss and control--in a specific enterprise.

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Leverage
1. The use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment.

2. The amount of debt used to finance a firms assets. A firm with significantly more debt than equity is considered to be highly leveraged.

Leverage Buyout
A strategy involving the acquisition of another company using borrowed money (bonds or loans). The acquiring company uses its own assets as collateral for the loan in hopes that the future cash flows will cover the loan payments.

Leveraged Finance
Leveraged finance is funding a company or business unit with more debt than would be considered normal for that company or industry. More-than-normal debt implies that the funding is riskier, and therefore more costly, than normal borrowing. As a result, levered finance is commonly employed to achieve a specific, often temporary objective: to make an acquisition, to effect a buy-out, to repurchase shares or fund a one-time dividend, or to invest in a self-sustaining cash-generating asset.

Limited Liability Company
A corporate structure whereby the shareholders of the company have a limited liability to the firms actions.

Limited Partnership
Two or more partners formed to conduct a business jointly, and in which one or more of the partners is liable only to the extent of the amount of money they have invested.
Limited partners do not receive dividends, but enjoy direct access to the flow of income and expenses.

Listing
Definition 1: The acceptance of a security for trading on a registered exchange.
Definition 2: A written agreement between a real estate owner and an agent authorizing the agent to search for a buyer for the property.

Listed Security
Securities that have been accepted for trading purposes by a recognized and regulated exchange.

Listing Requirements
The requirements to trade on NYSE, AMEX, etc.

London Interbank Bid Rate - LIBID
This is the rate bid by banks on eurocurrency deposits.

London Stock Exchange - LSE
The primary stock exchange in the United Kingdom (U.K.) and the largest in Europe. Originated in 1773, the U.K.'s six regional exchanges joined together in 1973 to form the Stock Exchange of Great Britain and Ireland, later renamed the London Stock Exchange (LSE). The Financial Times Stock Exchange (FTSE) 100 Index, otherwise known as the "Footsie", is the dominant index, which contains 100 of the top blue-chips stocks on the exchange.

Long (Long Position)
1. The buying of a security such as a stock, commodity or currency, with the expectation that the asset will rise in value.
2. In the context of options, the buying of an options contract.

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M & A
The merging and acquiring of corporations.

M & A Consultant
A person who consultant pertaining to mergers and acquisitions.

M&A Firm
A firm that consults on the merging and acquiring of other corporations.

Market
1. Typically refers to the equity market where stocks are traded, but can also refer to the bond, options, or commodity market.

2. People with the desire and ability to buy a specific product.

Market Arbitrage
Purchasing and selling the same security at the same time in different markets to take advantage of a price difference between the two separate markets.

Market Maker
A broker-dealer firm that facilitates trading in a security. Each market maker competes for customer order flow by displaying buy and sell quotations. This process takes place in mere seconds.

Marketmaker (previously defined, some spell it as one word)
A broker-dealer firm that facilitates trading in a security. Each market maker competes for customer order flow by displaying buy and sell quotations. This process takes place in mere seconds.

Market Maker Spread
The difference between the price at which a Market Maker is willing to buy a security and the price at which the firm is willing to sell it (the difference between the bid and ask for a given security). Since each market maker can either buy or sell a stock at any given time, the spread represents the market maker's profit on each trade.

Merchant Bank
A bank that deals mostly in (but is not limited to) international finance, long-term loans for companies and underwriting. Merchant banks do not provide regular banking services to the general public.

Merger
The combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock.

Merger Consultant
A person who consultant pertaining to mergers and acquisitions.

Merger and Acquisition (M & A)
The merging and acquiring of corporations.

Mergers and Acquisitions (M & A)
The merging and acquiring of corporations.

Mergers and Acquisitions Consultant
A person who consultant pertaining to mergers and acquisitions.

Mergers and Acquisitions Firm
A firm that consults on the merging and acquiring of other corporations.

Merrill Lynch & Co.
One of the better known management and advisory companies. Merrill Lynch provides a wide range of services to both individual and institutional investors.

Mezzanine Financing
A hybrid of debt and equity financing. It is typically used to finance the expansion of existing companies and is basically debt capital that give the lender the rights to convert to an ownership or equity interest in the company if the loan is not paid back in time and in full. It is generally subordinated to debt provided by senior lenders such as banks and venture capital companies. Since mezzanine financing is usually provided to the borrower very quickly with little due diligence (on the part of the lender) and little or no collateral (on the part of the borrower), this type of financing is aggressively priced with the lender seeking a return in the 20%-30% range.

Micro-cap
Micro cap refers to a company with a market capitalization of between $50 million to $300 million.

Micro-Hedge
An investment technique used to eliminate the risk of a single asset. In most cases, this means taking an offsetting position in that single asset. If this asset is part of a larger portfolio, the hedge will eliminate the risk of the one asset but will have less of an effect on the risk associated with the portfolio.

Monetize
1. To convert into money.

2. To convert from securities into currency that can be used to purchase goods and services.

Money
1. A commodity or asset, such as gold, an officially issued currency, coin, or paper note, that can be legally exchanged for something equivalent, such as goods or services.

2. As defined by common law: a medium of exchange authorized or adopted by a domestic or foreign government and includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more nations.

Money Management
The process of managing money. It is typically performed by professional money managers (also known as portfolio managers) who oversee and have full discretion over large investment portfolios of pension funds, endowments and institutional and individual investors. Also known as "investment management".

Money Manager
A business or bank responsible for managing the securities portfolio of an individual or institutional investor. Typically, a money manager employs people with various expertise ranging from research and selection of investment options to monitoring the assets and deciding when to sell them. In return for a fee, the money manager has the fiduciary duty to choose and manage investments prudently for his or her clients, including developing an appropriate investment strategy, buying and selling securities to meet those goals. Also known as "portfolio manager" or "investment manager".

Money Market
The securities market dealing in short-term debt and monetary instruments. Money market instruments are forms of debt that mature in less than one year and are very liquid.

Mortgage Backed Securities - MBS
An investment instrument that represents ownership of an undivided interest in a group of mortgages. Principal and interest from the individual mortgages are used to pay investors' principal and interest on the MBS. Also known as "mortgage pass-through."

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Nano-Cap
Small public company with a market capitalization below $50 million.

NASD (National Association of Securities Dealers)
A securities industry organization responsible for the operation and regulation of the Nasdaq stock market and over-the-counter markets. They also administrate exams for investment professionals, such as the series 7 exam.

Nasdaq
Created in 1971, the Nasdaq was the world's first electronic stock market. The Nasdaq is a computerized system that facilitates trading and provides price quotations on some 5,000 of the more actively traded over-the-counter stocks. The term "Nasdaq" used to be capitalized "NASDAQ" as an acronym for National Association of Securities Dealers Automated Quotation. In recent times, the acronym was dropped, and Nasdaq is now used as a proper noun.

Nasdaq Listing
The process of having a company's securities trading on Nasdaq, a computerized system that facilitates trading and provides price quotations on some 5,000 of the more actively traded over-the-counter stocks.

Nasdaq National Market Securities - Nasdaq-NM
The Nasdaq National Market consists of over 3000 companies that have a national or international shareholder base, meet stringent financial requirements, and agree to specific corporate governance standards.

Nasdaq Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

National Association of Securities Dealers (NASD)
A securities industry organization responsible for the operation and regulation of the Nasdaq stock market and over-the-counter markets. They also administrate exams for investment professionals, such as the series 7 exam.

National Market System
A system with two main functions:
1. To facilitate trading of OTC stocks whose size, profitability, and trading activity meet specific criteria.

2. To post prices for securities on the NYSE and other regional exchanges simultaneously, allowing investors to obtain the best price.

National Quotations Bureau (Pink Sheets)
Electronic quotation system by the National Quotation Bureau containing price quotations for over-the-counter stocks. The Pink Sheets pre date NASDAQ. Since becoming electronically quoted in 1999 they are becoming more and more popular. Even larger sized companies are trading there as the Pink Sheets grow in prominence.

Net Asset Value - NAV
1. In the context of mutual funds, the total value of the fund's portfolio less liabilities. The NAV is usually calculated on a daily basis.
2. In terms of corporate valuations, the book value of assets less liabilities.

Net Asset Value Per Share - NAVPS
1. The value of a mutual fund share. Calculated by dividing the total net asset value of the fund by its number of outstanding shares.
2. A fundamental analysis indicator that gives an estimate of the value of a fund's shares after all assets are sold and all liabilities are paid off.

Net Income - NI
An individual or company's total earnings, reflecting revenues adjusted for costs of doing business, depreciation, interest, taxes, and other expenses.

Net Operating Income - NOI
A company's operating income minus income taxes and minority interest. If it is a positive value it is referred to as net operating income if it is a negative value it is referred to as a net operating loss (NOL).

Net Tangible Assets
Calculated as the total assets of a company, minus any intangible assets such as goodwill, patents and trademarks, less all liabilities and the par value of preferred stock. Also known as "net asset value" or "book value".

New Issue
The event of a security being sold to the public for the first time.

New York Board of Trade - NYBOT
A commodities exchange in New York that trades futures and options on sugar, cotton, coffee, cocoa, and orange juice, in addition to interest rates, currency, and indexes.

New York Mercantile Exchange - NYMEX
The world's largest physical commodity futures exchange. Trading is conducted through two divisions: the NYMEX Division, which is home to the energy, platinum and palladium markets, and the COMEX Division, where metals like gold, silver and copper and the FTSE 100 index options are traded. The NYMEX uses an outcry trading system during the day and an electronic trading system after hours.

New York Stock Exchange - NYSE
A corporation, operated by a board of directors, responsible for listing securities, setting policies, and supervising the stock exchange and its member activities. The NYSE also oversees the transfer of members' seats on the Exchange, judging whether a potential applicant is qualified to be a specialist.

Non-Reporting Shell
A public shell that is not reporting.

NYSE
New York Stock Exchange.

NYSE Composite Index
Measures all common stocks listed on the New York Stock Exchange and four subgroup indexes: Industrial, Transportation, Utility, and Finance. The index tracks the change in market value of NYSE common stocks, adjusted to eliminate the effects of new listings and de-listings. The market value of each stock is calculated by multiplying its price per share by the number of shares listed.

NYSE Listing
Listing a company's securities for trading on the New York Stock Exchange.

NYSE Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

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Offering
An offering of stocks or bonds.

Offering Circular
An abbreviated prospectus for a new security listing. Delivered to individuals and brokerage houses, these documents are issued to arouse interest in the new issue.

Offering Memorandum
A legal document stating the objectives, risks, and terms of investment involved with a private placement.

Officer
An executive of a company who shares responsibility for the operation of his/her company.

Online Banking
The performance of banking activities via the Internet.

Online Trading
Making trades via the Internet.

Open End Fund
A mutual fund that continues to sell shares to investors, and will buy back shares when investors wish to sell.

Organization for Economic Co-operation and Development - OECD
The OECD is a group of 30 member countries who discuss and develop economic and social policy.

OTC (Over The Counter)
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

OTC Bulletin Board
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for
over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

OTC Bulletin Board Listing
The process having a company's securities eligible for trading on the over the counter bulletin board.

OTCBB (Over The Counter Bulletin Board)
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

OTCBB Listing
The process having a company's securities eligible for trading on the over the counter bulletin board.

OTCBB Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

OTC Options
Exotic options traded on the over-the-counter market, where participants can choose the characteristics of the options traded.

Over The Counter (OTC)
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

Over The Counter Bulletin Board (OTCBB)
An electronic trading service offered by the National Association of Security Dealers (NASD) that shows real-time quotes, last-sale prices, and volume information for over-the-counter (OTC) equity securities. OTC securities include newer small cap companies, national, regional and foreign equity issues, warrants, units, American Depositary Receipts (ADRs) and Direct Participation Programs (DPPs).

Over the Counter Listing
The process having a company's securities eligible for trading on the over the counter bulletin board.

Overnight Rate
The interest rate at which a depository institution lends immediately available funds (balances within the central bank) to another depository institution overnight.

Oxley Sarbanes
An act passed by U.S. Congress to protect investors from the possibility of fraudulent accounting activities by corporations.

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Pacific Exchange - PCX
A corporation, operated by a board of directors, responsible for listing securities, setting policies, and supervising the stock exchange and its member activities. The NYSE also oversees the transfer of members' seats on the Exchange, judging whether a potential applicant is qualified to be a specialist.

Passive Foreign Investment Company - PFIC
A foreign company whose income is 75% passive or has over 50% of its assets in investments earning interest, dividends, and/or capital gains.

Penny Stock
A stock which sells for less than one dollar per share (or in some cases, less than five dollars per share). Penny stocks are almost always small cap stocks, but the reverse isn't necessarily true. They are traded on the OTC Bulletin Board and the Pink Sheets.

Penny Stock List
A list of stock that sells for less than $1 a share but may also rise to as much as $10/share as a result of heavy promotion. All penny stocks are traded OTC or on the pink sheets.

Personal Finance
Financial planning for individuals. Generally, it involves analyzing their current financial position, predicting short-term and long-term needs, and recommending a financial strategy. This may involve advice on pensions, school fees, mortgages, life insurance, and investments

Philadelphia Stock Exchange - PHLX
The first stock exchange to be formed in the United States.

Piggy Back Registration
When an underwriter allows existing holdings of a company's shares to be sold in conjunction with an offering of new public shares.

Pink Sheets
A daily publication compiled by the National Quotation Bureau containing price quotations for over-the-counter stocks. Unlike companies on a stock exchange, companies quoted on the pink sheets system are not required to meet minimum requirements or file with the SEC.

Pink Sheet Listing
The process having a companies securities eligible for trading on the Pink Sheets (National Quotations Bureau).

Pink Sheet Stock
Stocks trading on the Pink Sheets.

Pink Sheets
Electronic quotation system by the National Quotation Bureau containing price quotations for over-the-counter stocks. The Pink Sheets pre date NASDAQ. Since becoming electronically quoted in 1999 they are becoming more and more popular. Even larger sized companies are trading there as the Pink Sheets grow in prominence.

Pink Sheets Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

PIPE Funding
A private investment firm or mutual funds purchases of stock in a company at a discount to the current market value per share.

PIPE Offering
A transaction in which accredited investors are allowed to purchase stock in a public company, usually below the market price. The stock is registered with the SEC so that it may later be resold to the public.

PIPES
A transaction in which accredited investors are allowed to purchase stock in a public company, usually below the market price. The stock is registered with the SEC so that it may later be resold to the public.

PIPES Financing
A private investment firm or mutual funds purchases of stock in a company at a discount to the current market value per share.

PIPES Offering
A transaction in which accredited investors are allowed to purchase stock in a public company, usually below the market price. The stock is registered with the SEC so that it may later be resold to the public.

Portfolio Management
The art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk vs. performance.

Portfolio Manager
The person responsible for investing a mutual fund's assets, implementing its investment strategy, and managing the day-to-day portfolio trading.

Preferred Dividend Coveraged Ratio
A coverage ratio that measures a company's ability to pay off its required preferred dividend payments. A healthy company will have a high coverage ratio, indicating that it has little difficulty in paying off its preferred dividend requirements.

Preferred Redeemable Increased Dividend Equity Security - PRIDES
First introduced by Merrill Lynch, PRIDES are synthetic securities consisting of a forward contract to purchase the issuer's underlying security and an interest bearing deposit. Interest payments are made at regular intervals, and conversion into the underlying security is mandatory at maturity.

Preferred Stock
A class of ownership in a corporation with a stated dividend that must be paid before dividends to common stock holders. Preferred stock does not usually have voting rights.

Premium Bond
A bond that is priced higher than its par value.

President
An executive of a company who shares responsibility for the operation of his/her company.

Price-Earnings Ratio - P/E Ratio
A valuation ratio of a company's current share price compared to its per-share earnings.

Principal
1. The amount borrowed or the amount still owed on a loan, separate from interest.
2. The original amount invested, separate from earnings.
3. The face value of a bond.
4. The owner of a private company.
5. The main party to a transaction, acting as either a buyer or seller for his/her own account and risk.

Private Banking
Beyond just providing credit or managing investments, private banking addresses your entire financial situation. Services include everything from protecting and growing your assets in the present, to planning retirement and passing wealth on to future generations.

Private Company
A company whose ownership is private and, thus, do not need to meet the strict SEC filing requirements of public companies.

Private Equity
When equity capital is made available to companies or investors from private sources.

Private Investment in Public Equity (PIPE)
A transaction in which accredited investors are allowed to purchase stock in a public company, usually below the market price. The stock is registered with the SEC so that it may later be resold to the public.

Private Placement
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors.

Private Placement Memorandum
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors.

Private Placement Offering
Raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors.

Prospectus
1. A formal legal document describing details of a corporation. The prospectus is generally created for a proposed offering (usually an IPO), but they can still be obtained from existing businesses as well. The prospectus includes company facts that are vitally important to potential investors.
2. In this case of mutual funds, a prospectus describes the fund's objectives, history, manager background, and financial statements.

Proxy
A formal document signed by a shareholder to authorize another shareholder, or commonly the company's management, to vote the holder's shares at the annual meeting.

Public Company Accounting
Accounting for Public Companies.

Public Company Accounting Oversight Board (PCAOB)
A non-profit organization that regulates auditors of publicly traded companies.

Public Shell
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

Public Shells
Plural of Public Shell. A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

Publicly Traded Company
A public corporation.

Public Traded Partnership
A limited partnership that also has interests traded in the equity securities market.

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Raging Bull
Optimistic investors who are presently predicting good things for the market, and are attempting to profit from this upward movement. For example if you are bullish on the S&P 500 you will attempt to profit from a rise in the index by going long on it. Bulls are are the exact opposite of the market's bears, who are pessimistic and believe that a particular security, commodity or entity will suffer a decline in price.
Bullishness does not necessarily apply only to the stock market; you could for example be bullish on just about anything, including commodities like soy beans, crude oil or even peanuts.

Raising Money
Process of obtaining additional capitalization or funding.

Real Estate
Land plus anything permanently fixed to it, including buildings, sheds, and other items attached to the structure.

Real Estate Investment Trust - REIT
A security that sells like a stock on the major exchanges and invests in real estate directly, either through properties or mortgages.

Real Income
The income of an individual or group after taking into consideration the effects of inflation on purchasing power. For example, if you received a 2% raise in salary over the previous year and inflation for the year was 1%, then your real income only rose 1%. Conversely, if you received a 2% raise in salary and inflation stood at 3%, then your real income would have decreased 1%. Also known as real wages.

Red Herring
A preliminary registration statement that must be filed with the SEC describing a new issue of stock (IPO) and the prospects of the issuing company.

Regional Stock Exchange
Any exchange that resides beyond the country's main financial center.

Reg D
A Securities and Exchange Commission (SEC) regulation governing private placement exemptions.

Registered Investment Advisor - RIA
An advisor, registered with the Securities and Exchange Commission, who manages the investments of others.

Registered Representative
A person who works for a brokerage company that is licensed by the Security and Exchange Commission (SEC) and acts as an account executive for clients trading investment products such as stocks, bonds and mutual funds. Also known as an "account executive".

It is also refers to a person registered with the Commodity Futures Trading Commission (CFTC) who works for a commission house or a futures commission merchant.

Registered Spinoff
A spinoff involving a registration statement.

Registration Statement
A carefully prepared set of documents, including a prospectus, which is filed with the SEC prior to an initial public offering.

Regulation A
An SEC regulation that governs offerings of $5,000,000 or less, which qualify for simplified registration (an exemption).

Regulation D
A Securities and Exchange Commission (SEC) regulation governing private placement exemptions.

Regulation Fair Disclosure - Reg FD
A rule passed by the Securities and Exchange Commission in an effort to prevent selective disclosure by public companies to market professionals and certain shareholders.

The Reg FD rule reads as follows: "Whenever an issuer, or any person acting on its behalf, discloses any material nonpublic information regarding that issuer or its securities to [certain enumerated persons], the issuer shall make public disclosure of that information... simultaneously, in the case of an intentional disclosure; and... promptly, in the case of a non-intentional disclosure."

Regulation G
The Federal Reserve Board regulation that governs the extension of credit for securities transactions by commercial lenders and non-financial corporations.

Regulation M
An IRS regulation that allows regulated investment companies to pass taxes from capital gains, dividends, and interest distributions onto individual investors.

Regulation Q
A Federal Reserve Board regulation that limits the interest rate banks can pay on savings deposits.

Regulation T
The Federal Reserve Board regulation that governs customer cash accounts and the amount of credit that brokerage firms and dealers may extend to customers for the purchase of securities.

Regulation U
The Federal Reserve Board regulation that governs loans by banks for the purchase of securities.

REIT
A security that sells like a stock on the major exchanges and invests in real estate directly, either through properties or mortgages. REITs receive special tax considerations, and typically offer investors high yields as well as a highly liquid method of investing in real estate. Equity REITs: Equity REITS invest in and own properties (thus responsible for the equity or value of their real estate assets). Their revenues come principally from their properties' rents. Mortgage REITs: Mortgage REITs deal in investment and ownership of property mortgages. These REITs loan money for mortgages to owners of real estate, or invest in (purchase) existing mortgages or mortgage backed securities. Their revenues are generated primarily by the interest that they earn on the mortgage loans. Hybrid REITs: Hybrid REITs combine the investment strategies of Equity REITs and Mortgage REITs by investing in both properties and mortgages.

Reporting Public Shell
A public shell that is reporting with the SEC.

Repurchase Agreement - Repo
A form of short term borrowing for dealers in government securities. The dealer sells the government securities to investors, usually on an overnight basis, and buys them back the following day. For the party selling the security (and agreeing to repurchase it in the future) it is a repo; for the party on the other end of the transaction (buying the security and agreeing to sell in the future) it is a reverse repurchase agreement.

Research and Development - R and D
A company's activities that are directed at developing new products or procedures.

Restricted Stock
Insider holdings that are under some other kind of sales restriction. Restricted stock must be traded in compliance with special SEC regulations.

Retail Banking
Retail banking is typical mass-market banking where individual customers use local branches of larger commercial banks. Services offered include: savings and checking accounts, mortgages, personal loans, debit cards, credit cards, and so forth.

Retail Investor
Individual investors who buy and sell securities for their personal account, and not for another company or organization.

Return of Capital
A return from an investment that is not considered income. The return of capital is when some or all of the money an investor has in an investment is paid back to him or her, thus decreasing the value of the investment. This is not a gain of any type because it is not in excess of the original investment.

Return on Assets - ROA
A useful indicator of how profitable a company is relative to its total assets. Calculated by dividing a company's annual earnings by its total assets, ROA is displayed as a percentage. Sometimes this is referred to as Return on Investment.

Return on Investment - ROI
The profit or loss resulting from an investment transaction, usually expressed as an annual percentage return.

Reuters
A global information provider headquartered in London, England, and serving professionals in the financial services, media and corporate markets. The news agency provides text, graphics, video and pictures to subscribers around the world, including general and economic news. Reuters Group trades on the London Stock Exchange and Nasdaq as 'RTR' and 'RTRSY'.

Revenue
1. The dollar amount of sales during a specific period, including discounts and returned merchandise. It is the "top line" figure from which costs are subtracted to determine net income.

2. When evaluating stocks, revenue growth serves as an indication of a company's health.

Reverse Merger
A method used to go public. (Recently they have fallen out of favor because there are much easy ways to become a public company) A private company merges with an existing public company or a subsidiary of a public company. In a reverse merger, an operating private company merges with a public company which has no assets or known liabilities (the "shell" corporation). The public corporation is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. The private company obtains the majority of the shell’s stock (usually 90%). The private company normally will change the name of the public corporation (often to its own name) and will elect its Board of Directors which will appoint the officers.

Reverse Mortgage
A special type of loan used to convert the equity in a home into cash. The money obtained through a reverse mortgage is usually used to provide seniors with financial security in their retirement years.

Reverse Stock Split
A reduction in the number of a corporation's shares outstanding that increases the par value of its stock or its earnings per share. The market value of the total number of shares (market capitalization) remains the same.

Reverse Takeover - RTO
1. The buying out of larger company by a smaller company.

2. The purchasing of a public company by a private company.

Reverse Triangular Merger
When the subsidiary of the acquiring corporation merges with the target firm. In this case, the subsidiary's equity merges with the target firm's stock. As a result of the merger, the target would become a wholly-owned subsidiary of the acquirer and shareholders of the target would get shares of the acquirer.

Revocable Trust
A trust whereby provisions can be altered or cancelled dependent on the grantor. During the life of the trust, income earned is distributed to the grantor, and only after death does property transfer to the beneficiaries

Road Show
A presentation by an issuer of securities to potential buyers. It is intended to create interest in the securities.

ROI
The profit or loss resulting from an investment transaction, usually expressed as an annual percentage return.

RTO
Reverse takeover.

Rule 144A
A Securities & Exchange Commission rule modifying a two-year holding period requirement on privately placed securities to permit qualified institutional buyers to trade these positions among themselves.

Rule 504
A Securities and Exchange Commission (SEC) regulation governing private placement exemptions.

Rule 505
A Securities and Exchange Commission (SEC) regulation governing private placement exemptions.

Rule 506
A Securities and Exchange Commission (SEC) regulation governing private placement exemptions.

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SAR
In currencies, this is the abbreviation for the Saudi Riyal.

SBA
Small Business Administration - A Federal agency which makes loans to small businesses.

Sarbanes
An act passed by U.S. Congress to protect investors from the possibility of fraudulent accounting activities by corporations.

Sarbanes Oxley Act
An act of congress. See Sarbanes Oxley.

Sarbanes Oxley Compliance
Pertains to following the laws, set out in the Sarbanes Oxley Act.

Sarbanes Oxley
An act passed by U.S. Congress to protect investors from the possibility of fraudulent accounting activities by corporations.

Sarbanes-Oxley Act of 2002 - SOX
An act passed by U.S. Congress to protect investors from the possibility of fraudulent accounting activities by corporations.

S-3 Filing
The most simplified registration form. It can only be used by companies that have been required to report under the '34 Act for a minimum of twelve months and have met the timely filing requirements set forth under Form S-2.

S-8 Filing
A SEC filing required for companies wishing to issue equity to their employees.

Safe Harbor
1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated.

2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. In effect, this gives the target company a "safe harbor."

3. An accounting method that avoids legal or tax regulations and allows for a simpler method (usually) of determining a tax consequence than those methods described by the precise language of the tax code.

Sallie Mae - Student Loan Marketing
A publicly traded company that is the largest provider of educational loans in the U.S. Along with providing student loans, Sallie Mae purchases student loans from the original lenders and provides financing to state student-loan agencies.

SB-1
A type of Registration statement for small business issuers.

SB-2
A type of Registration statement for small business issuers.

Sarbanes-Oxlex Act of 2002 - SOX
An act passed by U.S. Congress to protect investors from the possibility of fraudulent accounting activities by corporations.

SEC
Securities and Exchange Commission

SEC EDGAR
The SEC's system used by all public companies to transmit required filings, such as quarterly reports and annual reports and ongoing disclosure obligations. Also called Electronic Data Gathering, Analysis, and Retrieval (EDGAR).

Secondary Market
A market in which an investor purchases an asset from another investor, rather than an issuing corporation.

Secondary Offering
A sale of securities in which one or more major stockholders in a company sell all or a large portion of their holdings. The underwriting proceeds are paid to the stockholders, rather than to the corporation.

Securities
An instrument representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

Securities Act
The Securities Act generally requires companies to give investors "full disclosure" of all "material facts," the facts investors would find important in making an investment decision. This Act also requires companies to file a registration statement with the SEC that includes information for investors. The SEC does not evaluate the merits of offerings, or determine if the securities offered are "good" investments. The SEC staff reviews registration statements and declares them "effective" if companies satisfy our disclosure rules.

Securities Attorney
An attorney specializing in the laws pertaining to instruments representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

Securities Law
The laws pertaining to instruments representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

Securities Lawyer
An attorney specializing in the laws pertaining to instruments representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

Security
An instrument representing ownership (stocks), a debt agreement (bonds), or the rights to ownership (derivatives).

SEDAR
The electronic filing system for the disclosure of documents of public companies and mutual funds across Canada.

Series 63
A securities license entitling the holder to solicit orders for any type of security in a particular state. This license is required in addition to the Series 7 or Series 6.

Series 7
A general securities registered representative license, it entitles the holder to sell all types of securities products with the exception of commodities/futures (which requires a Series 3 license).

Shareholder
Any person, company, or other institution that owns at least 1 share in a company. A shareholder may also be referred to as a stockholder.

Shareholder's Equity
A firms total assets minus its total liabilities, or equivalently, share capital plus retained earnings minus treasury shares. It is the amount of the company that is financed through common and preferred shares.

Shares
Certificates representing ownership in a corporation.

Shelf Offering
An SEC provision allowing an issuer to register a new issue security without selling the entire issue at once.

Shelf Registration
An term used for the SEC rule 415, which allows a corporation the ability to comply with registration requirements up to 2 years before doing a public offering. The corporation must still file the required annual and quarterly reports to the SEC.

Shell Corporation
A corporation without active business operations or significant assets.

Shells
A public corporation that is called a "shell" since all that exists of the original company is its corporate shell structure and shareholders. It has no business operation or significant assets.

Silicon Valley
Nickname for the region in North California (around San Jose) that contains a huge concentration of computer and Internet companies.

Small Business Administration
A Federal agency which makes loans to small businesses.

Small Cap
Refers to stocks with a relatively small market capitalization. The definition of small cap can vary among brokerages, but generally it is a company with a market capitalization of between $300 million to $2 billion.

Socially Responsible Investment - SRI
Investments or funds containing stock in companies whose activities are considered ethical.

SOES Bandits
A slang term for traders who make rapid buy and sell orders, using the SOES system, in order to make a profit from small price changes.

Specialist
A person on the trading floor of certain exchanges who holds an inventory of particular stocks. The specialist is responsible for managing limit trades, but does not make information on outstanding limit orders available to other traders.

Spread
1. The difference between the bid and the ask prices of a security or asset.
2. An options position established by purchasing one option and selling another option of the same class, but of a different series.

Standard and Poor's - S&P
A financial services company that rates stocks and corporate and municipal bonds according to risk profiles.

Standard and Poor's 500 Index - S&P 500
An index consisting of 500 stocks chosen for market size, liquidity and industry group representation, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities, and it is meant to reflect the risk/return characteristics of the large-cap universe.

Companies included in the index are selected by the S&P Index Committee, which is a team of analysts and economists at Standard and Poor's. The S&P 500 is a market-value weighted index, which means each stock's weight in the index is proportionate to its market value.

Stock
A type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings.

There are two main types of stock: common and preferred. Common stock usually entitles the owner the right to vote at shareholder meetings and to receive dividends that the company has declared. Preferred stock generally does not have voting rights, but has a higher claim on assets and earnings than the common shares. For example, owners of preferred stock receive dividends before common shareholders and have priority in the event a company goes bankrupt and is liquidated.

Also known as shares, or equity.

Spinoff
A new, independent company created through selling or distributing new shares for an existing part of another company.

Stock Broker
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Stock Brokerage
A financial intermediary that performs a variety of services. This includes underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations.

Stock Dividend
A dividend payment made in the form of additional shares, rather than a cash payout.

Stock Listing Requirements
The requirements to trade on NYSE, AMEX, etc.

Stock Market
General term for the organized trading of stocks through exchanges and over-the-counter.

Stock Offering
An offering of a security (stock).

Stock Option
A privilege, sold by one party to another, that gives the buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an agreed-upon price during a certain period of time or on a specific date.

Stockbroker
An individual or firm that charges a fee or commission for executing buy and sell orders submitted by an investor.

Stock Market Listing
The acceptance of a security for trading on a registered exchange.

Stock Split
The dividing of a company's existing stock into multiple shares. In a 2-for-1 split, each stockholder receives an additional share for each share he or she holds.

Stock Symbol
A unique symbol assigned to a security. NYSE and AMEX listed stocks have symbols of three characters or less. Nasdaq-listed securities have four or five characters. If a fifth letter appears, it identifies the security as other than a single issue of common stock. Stock symbols are also known as tickers or ticker symbols.

Stockholder's Equity
The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock, and intangible assets.

Strategic Alliance
An arrangement between two companies who have decided to share resources in a specific project.

Strategic Asset Allocation
A portfolio strategy that involves periodically re-balancing the portfolio in order to maintain a long-term goal for asset allocation.

Subsidiary
A company whose voting stock is more than 50% controlled by another company, usually referred to as the parent company.

Syndicate
A group of bankers, insurers, etcetera, who work together on a large project.

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Takedown
1. The price at which underwriters obtain securities to be offered to the public.
2. The portion of securities that each investment banker will distribute in a secondary or initial pubic offering.

Takeover
A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the acquiring company will make an offer for the outstanding shares.

The Bond Buyer
A century-old U.S. newspaper published five times a week covering the municipal bond industry. Banks, underwriters, government agencies, Wall Street firms, insurance companies and others read it for municipal bond news, trends and analysis.

Ticker Tape
A computerized device that relays financial information to investors around the world, including the stock symbol, the latest price, and volume on securities as they are traded.

Toronto Stock Exchange - TSX
The largest stock exchange in Canada, traditionally home to a large number of natural resource companies.

Trade
1. A transaction involving the sale and purchase of a security.
2. In general, the buying and selling of goods and services.

TSE
The stock exchange headquartered in Tokyo, Japan.

Turnaround
A situation where a company that has had poor performance for an extended period of time experiences a positive reversal.

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Undervalued
A stock or other security that is trading below its true value.

Underwriter
An organization that raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt).

Underwriting
The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt).

Upside
The potential dollar amount by which the market or a stock could rise.

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Venture Capital
Financing for new businesses. In other words, money provided by investors to startup firms and small businesses with perceived, long-term growth potential. This is a very important source of funding for startups that do not have access to capital markets and typically entails high risk for the investor but has the potential for above-average returns

Venture Capitalist
An investor who provides capital to either start-up ventures or support small companies who wish to expand but do not have access to public funding.

Venture Capital Funds
An investment fund that manages money from investors seeking private equity stakes in small and medium-size enterprises with strong growth potential.

Vertical Merger
A merger between two companies producing different goods or services for one specific finished product.

Vertical Spread
An options trading strategy with which a trader makes a simultaneous purchase and sale of two options of the same type that have the same expiration dates but different strike prices.

VIX - CBOE Volatility Index
The ticker symbol for the Chicago Board Options Exchange (CBOE) Volatility Index and represents the implied volatility on the S&P 100 (OEX) option. This volatility is meant to be forward looking and is calculated from both calls and puts that are near-the-money. The VIX is a popular and widely used measure of market risk.

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White Knight
A company that makes a friendly takeover offer to a target company that is being faced with a hostile takeover from a separate party.

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X
1. A Nasdaq stock symbol specifying that it is a mutual fund.
2. A symbol used in stock transaction tables found on the internet and in newspapers to indicate that a stock is trading ex-dividends or ex-rights.

XD
A symbol used to signify that a security is trading ex-dividend.

XDIS
A symbol used specifically upon the consolidated tape to indicate a security trading ex-distribution.

XRT
A symbol used specifically upon the consolidated tape to indicate a security trading ex-rights.

XW
A symbol used to signify that a security is trading ex-warrant.

Xenocurrency
A currency that trades outside of its domestic borders.

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Y
A Nasdaq stock symbol specifying that a particular stock is an American Depositary Receipt (ADR).

YOY
An acronym that stands for Year Over Year.

YTD - Year to Date
The period beginning January 1st of the current year up until today's date

YTM
The rate of return anticipated on a bond if it is held until the maturity date. YTM is considered a long-term bond yield expressed as an annual rate. The calculation of YTM takes into account the current market price, par value, coupon interest rate and time to maturity. It is also assumed that all coupons are reinvested at the same rate. Sometimes this is simply referred to as "yield" for short.

Yankee Bond
A bond denominated in U.S. dollars and issued in the United States by foreign banks and corporations.

Yankee CD
A certificate of deposit (CD) issued in the U.S. market, typically in New York, by a branch of a foreign bank.

Yard
Slang for one billion units in currency.

Year
In taxation, year refers to the calendar year that runs from January 1st to December 31st. However, corporations can generally set the time period for which they report financial results to be different than the calendar year.

Yellow Knight
A company that was once making a takeover attempt but ends up discussing a merger with the target company.

Yellow Sheets
A U.S. bulletin that gives updated bid and ask prices as well as other information on OTC bonds.

Yield
The rate of income generated from a stock in the form of dividends, or the effective rate of interest paid on a bond, calculated by the coupon rate divided by the bond's market price. Furthermore, for any investment, yield is the annual rate of return expressed as a percentage.

Yield Curve
A graphic line chart that shows interest rates at a specific point for all securities having equal risk, but different maturity dates. For bonds, it typically compares the 2 or 5 year treasury with the 30 year.

Yield Elbow
The point on the yield curve indicating the year in which the economy's highest interest rates occur.

Yield Equivalence
The interest rate on a taxable security that would render a return equivalent to that of a tax-exempt security, and vice versa.

Yield Maintenance
A prepayment premium that allows investors to attain the same yield as if the borrower made all scheduled mortgage payments until maturity.

Yield Pickup
A gain in yield achieved by selling one bond and buying another with a higher yield.

Yield to Call
The yield of a bond or note if you were to buy and hold the security until the call date. This yield is valid only if the security is called prior to maturity. The calculation of yield to call is based on the coupon rate, the length of time to the call date, and the market price.

Yield To Maturity -YTM
The rate of return anticipated on a bond if it is held until the maturity date. YTM is considered a long-term bond yield expressed as an annual rate. The calculation of YTM takes into account the current market price, par value, coupon interest rate and time to maturity. It is also assumed that all coupons are reinvested at the same rate. Sometimes this is simply referred to as "yield" for short.

Yield to Worst
The yield to maturity if the worst possible bond repayment takes place. If market yields are higher than the coupon, the yield to worst would assume no prepayment. If market yields are below the coupon, the yield to worst would assume prepayment. In other words, yield to worst assumes that market yields are unchanged.

Yo-Yo
Slang for a very volatile market.

YOY
An acronym that stands for Year Over Year.

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Z
A Nasdaq stock symbol specifying that it is a miscellaneous situation such as a depositary receipt, stub, additional warrant, or unit.

ZAR
In currencies, this is the abbreviation for the South African Rand.

ZBA
A checking account in which a balance of zero is maintained by automatically transferring funds from a master account in an amount only large enough to cover checks presented.

ZBB
A method of budgeting in which all expenditures must be justified each new period, as opposed to only explaining the amounts requested in excess of the previous period's funding.

ZEBRA
A swap agreement between a municipality and a financial intermediary. Also known as a "perfect swap" or "actual rate swap".

ZMK
In currencies, this is the abbreviation for the Zambian Kwacha.

ZMD
In currencies, this is the abbreviation for the Zibabwe Dollar.

Z-Score
A statistical measure that quantifies the distance (measured in standard deviations) a data point is from the mean of a data set. In a more financial sense, Z-score is the output from a credit-strength test that gauges the likelihood of bankruptcy.

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This information is intended as a public resource for those gathering information and conducting due diligence for reverse mergers and public shells. It is not a solicitation to buy or sell securities and should not be construed as legal advice or considered to be a replacement for retaining securities legal counsel.