Glossary 3 Flashcards
(16 cards)
Arbitration
The settling of a dispute through non-judicial means; all parties must accept the decisions of an arbitrator.
Ask Price *or offered price/asked
Lowest price a potential seller is prepared to accept for a stock.
Ask quote
Price at which a market maker is willing to sell a stock
Assessed valuation
Value that a municipality assigns to a parcel of property for purposes of computing taxes owned on that property.
Asset
Anything of value owned by a business
Assignment
The match of a holder who wants to exercise an option with a writer of the identical option. After being notified by the holder’s broker, the OCC randomly assigns the option to a broker dealer representing an appropriate writer. The broker, in turn, selects a particular writer, either randomly or on a first in, first out FIFO basis.
Associated Person
Employee who is registered with a securities firm and has passed the required licensing exam.
Assumed Interest Rate (AIR)
Insurance company’s non-binding estimate of the expected return on a variable annuity.
At the close
Order intended to be executed as close to the day’s closing price as possible
At the money
For put options, when the strike price is the same as the market price of the underlying security.
At the opening
Order intended to be executed at the stock’s opening price (or as close as possible) on a given day
Auction Market
Securities marketplace that has a physical trading floor, where prices are established by competitive bids and offers. One specialist creates orderly market for each stock and operates from a trading post on the floor.
Auditor
Independent accounting firm hired by a mutual fund to compile its financial statements and a list of securities in its portfolio
Authorized Stock
Amount of stock a corporation’s charter allows it to sell
Average Life
Expected maturity of a pool of mortgages, given the prepayment speed predicted by the PSA model
Away from the market
Term of any order that is not at the current market price
