Glossary 2 Flashcards
Call Option
Contract that provides the right to buy a number of shares of a security at a fixed price at any time until a certain date.
Capital Account
Difference between the amount of foreigners invest in a countryand the amount that residents of the country invest abroad.
Call premium
For callable bonds, the amount by which the call price exceeds the bond’s face value.
Call Protection
Feature some callable bonds that prevents the issuer from redeeming the bond before a certain date, usually 10 or more years after the issue.
Call provision
Measure in some bond indentures that enables the issuing company to buy back (call in) the bond before maturity
Call rate (or broker loan rate)
Risk that the issuer of a callable bond might redeem the bond prior to maturity, thereby reducing an investor’s expected return
Callable Preferred
Preferred stock that the issuer can call (buy back) if interest rates fall; typically pays a higher dividend rate because of the call feature.
Blanket Fidelity Bond
An insurance policy that NYSE member firms must purchase to protect their investors against fraud or embezzlement.
Blind Pool Investment
An investment program specifying only the kind of investment it will make, not the actual investments.
Blind pool investment
An investment program specifying the only kind of investments it will make, not the actual investment.
Block Trade
A trade involving 10,000 shares or more.
Blue Sky Laws
State laws with whcih a company must comply in order to sell its securities within the state’s boundaries.
Board Broker
Exchange member who helps OBOs with trades for the most active options
Bonafide Quote
Price given on a security by a broker who is prepared to honor at that time, but who can change the quote prior to the transaction if market conditions change.
Bond
Transferable long-term debt instruments that pays a fixed interest rate. Issuers must repay the principal at maturity to bondholders, who do not have ownership rights in the issuing firm.
