Alphabet Soup Flashcards
Z tranche
Represents the riskiest level that an investor in a collateralized mortgage obligation can assume
Carries no holding period interest and is the last selection to receive a payout
BPS
Basis points
100 bps = 1%
CMO
Collateralized mortgage obligation
A substantial pool of mortgage backed securities created by a brokerage firm
An investor buys a particular “tranche” each of which presents a unique risk level
Reg D
Represents a bond of securities and exchange rules that apply to new issues of private placement securities
Requires disclosure and limits the number of non-accredited investors
EFC
Expected family contribution
The amount of money that a student and family would need to contribute to college costs before financial aid becomes available
FOMC
Federal Open Market Committee
Influences US money supply by alternately infusing the domestic banking system with cash or securities
Has strong influence on short term interest rates and unemployment rates
K1
Reports the amount of annual profit, gain or loss attributable to owners of pass through entities
Includes LP, FLP, trusts, estates
LLC
Limited liability company
Corporation is choosing to be taxed as a partnership
Offers limited liability if corporations as well as pass through nature of a partnership
OASDI
Old age, survivors and disability tax
Portion of FICA tax that does not address Medicare
Is imposes on earned income up to the taxable wage base
QBI
Qualified business income
Income distributed to an owner or investor from a pass through entity like a LLC, s corp, REIT
A below the line deduction of up to 20% QBI may be available
RSU
Restricted stock unit
Executive perk generally based on performance and years of service grants stock
Presuming the granting employer remains afloat, the will have a value
UIT
Unit investment trust
Unmanaged portfolio of securities
Usually municipal bonds
