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ACON - The 'A' network of the Consolidated Tape. This network reports trading of securities listed on the New York Stock Exchange and identifies any other originating market.

AMBD - American Stock Exchange Bonds

AMERICAN BANKERS ASSOCIATION (ABA) - The national trade association of U.S. commercial banks. (

AMERICAN DEPOSITARY RECEIPT (ADR) - Certificates representing shares, held by a U.S. bank, or a foreign corporation listed on an overseas exchange. Bought and sold in dollars, they entitle the investor to dividends. Fluctuations in foreign currencies affect their value.

AMERICAN STOCK EXCHANGE (AMEX)- the primary exchange in U.S. for stocks, bonds, securities and options. (

AMOE - American Stock Exchange Options

ANNUAL REPORT - A company's report to its stockholders on its performance for the past fiscal year. Usually includes text, photos and all of the required financial numbers.

ANNUITY - An insurance company contract in which a client invests a lump sum and receives regular benefit payments over a period of years, usually after retirement. Annuities can have fixed or variable interest rates.

ASK (OFFER) - Generally, the lowest price at which a dealer will sell a given unit of stock. The difference between the BID price and the ASK price is called the SPREAD.

ASK (OFFER) OR BUY PRICE - The lowest price at which sellers of Nasdaq stock (including mutual funds) may sell shares. Also called the offer price. The difference between the bid price and the ask price is called the spread.

ASSET - Current cash and other items that can easily be converted into cash, usually within one year. A fixed asset is land, equipment, and long-term investments that cannot be readily converted into cash without disturbing the operation of the business.

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BALANCE SHEET - A listing of assets, liabilities and net worth showing the financial position of a company at the specific time. A bank balance sheet is generally referred to as a statement of condition.

BAND - A range within which a currency can trade. Some governments fix an exchange rate but allow their currency to trade perhaps 5 percent above or below that rate before intervening by buying or selling currency.

BANKRUPTCY - An individual or organization, acting voluntarily or by court order, liquidates its assets and distributes the proceeds to creditors. Types of bankruptcy are CHAPTER 7, CHAPTER 11, CHAPTER 12 and CHAPTER 13.

BASIS POINT - The movement of interest rates or yields expressed in hundredths of a percent. BB, B, CCC, CC, and C, for more speculative securities, and D for securities that are in payment default.

BCON - The 'B' network of the Consolidated Tape. This network reports trading of securities listed on the American Stock Exchange and also trading on regional exchanges.

BCOP - Bank for Cooperatives

BEAR MARKET - A period of generally declining stock prices.

BEARER BOND - A bond for which the owner's name is not registered on the books of the issuing company. Interest and principal is thus payable to the bondholder.

BEARER STOCK - Stock certificates that are not registered in any name. They are negotiable without endorsement and transferable by delivery.

BID - Generally, the highest price a buyer will offer for a given unit of stock. The difference between the BID price and the ASK price is called the SPREAD.

BIG BOARD - Also known as the New York Stock Exchange.

BLUE CHIP - A stock company known for its long-established record of making money and paying dividends.

BOND - A loan to a company or the government, which is payable at the end of a stated period. In return, the bond buyer is usually entitled to fixed payments on a regular basis until the bond comes due.

BOND FUND - A type of mutual fund that invests in government, corporate and other bonds. Most bond funds are created to provide income to shareholders and, unlike bonds, never mature or guarantee repayment.

BOND RATING - Grades assigned by credit rating agencies to corporate and municipal debt securities, based on the borrower's expected ability to repay. The higher the grade, the lower the interest rate a borrower must pay. The two major Wall Street credit rating firms are Moody's Investors Service Inc. and Standard & Poor's bond ratings. Both issue a variety of grades. S&P's bond ratings, for example, include 10 basic grades; in order, AAA, AA, A and BBB, given to borrowers with the strongest ability to repay;

BOOK VALUE - The difference between a company's assets and liabilities. The book value per share of common stock is the book value divided by the number of common shares outstanding.

BTI - Banks, Trusts and Insurance

BULL MARKET - A period of generally increasing market prices.

BULLION - Unminted precious metals of standards suitable for coining.


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CALL (BONDS) - The right to redeem outstanding bonds before their maturity date. An issuer will usually call a bond if the interest rate on the bond is higher than the rate for comparable bonds in the marketplace.

CALL (OPTIONS) - The right to buy a specific number of shares at a specified price on a specific date.

CAPITAL - Money, equipment or property used in a business by a person or corporation.

CAPITAL GAIN, CAPITAL LOSS - The difference between what a capital asset cost and the price it brought when sold. Capital gain is the profit from selling at a higher price than originally paid for. Capital loss is the loss incurred from selling an asset for less than the adjusted cost of buying it.



CENTRAL BANK - In most nations, the central bank is a government body that issues currency and sets interest rates in an effort to control the level of economic activity. In the United States, the Federal Reserve System fulfills this role.

CHANGE - The difference of the current price from the previous trading day's price.

CHAPTER 7 - Sometimes referred to as straight bankruptcy, this filing usually leads to liquidation of a company. A company in Chapter 7 proceedings is able to continue to operate under the direction of a court trustee until the matter is settled. If the company can resolve its problems and settle with creditors in the interim, it may not have to be liquidated.

CHAPTER 11 - The most common form of bankruptcy, this action frees a company from the threat of creditors' lawsuits while it reorganizes its finances. The debtor's reorganization plan must be accepted by a majority of its creditors. Unless the court rules otherwise, the debtor remains in control of the business and its assets.

CHAPTER 12 - This is an extension of Chapter 11, designed to help debt-burdened family farms. It allows family farmers to operate under bankruptcy court protection while paying off creditors.

CHAPTER 13 - Called the "wage earner" bankruptcy, this is available to individuals who promise to repay as many debtors as possible from available income.

CHARGE OFF - A loan that no longer is expected to be repaid and is written off as bad debt.

CHICAGO BOARD OF OPTIONS EXCHANGE (CBOE) - An options exchange set up by the Chicago Board of Trade (

CHICAGO BOARD OF TRADE (CBOT) - The largest commodity trading market in the United States. Trades grains, Treasury bonds and notes, precious metals and financial indexes. (

CHICAGO MERCANTILE EXCHANGE (CME) - Futures exchange that trades meat, livestock and currency. (

CLOSED-END FUND - A mutual fund with a limited number of shares, which are traded on a stock exchange. Closed-end funds are listed on the New York, American or Nasdaq exchanges.

CLOSELY HELD CORPORATION - A corporation in which stock shares and voting control are concentrated in the hands of a small number of investors, but for which some shares are available and traded on the market.


COFFEE, SUGAR AND COCOA EXCHANGE (CSCE) - The coffee, sugar and cocoa futures exchange in New York. (

COLLATERAL - Stock or other property that a borrower is obliged to turn over to a lender if unable to repay a loan.


COMMERCIAL PAPER - One of the various types of short-term negotiable instruments whereby industrial or finance companies obtain cash after agreeing to pay a specific amount of money on the date due.

COMMODITIES FUTURES CONTRACT - A contract to purchase or sell a specific amount of a given commodity at a specified future date.

COMMODITY - A tangible good that is bought or sold on the open market, such as gold, corn, oil or soybeans. Also refers to financial instruments such as CDs or Treasuries, on which futures contracts can be sold.

COMMON STOCK FUND - Mutual funds that invest almost exclusively in common stocks. The objectives of these fund groups are generally described as one of the following: Growth, Aggressive Growth, Growth & Income, Special Purpose or Index.

CONSOLIDATED TAPE - A data circuit consisting of an A Network, which reports NYSE based trading, and a B Network, which reports Amex based trading.

CONVERTIBLE BOND - A corporate bond that can be converted into another form of security, usually stock, at a later date.

COPT - Consolidated Options

CORPORATE BONDS - Basically a loan to a company. In return for lending money to the company, the owner of the bond gets regular interest payments and can sell the bond to other investors. The company can use the money to fund growth - expansion of its operations, hiring a larger work force, etc.

COUPON - The interest rate that the bond issuer agrees to pay a bondholder until the bond comes due. It is expressed as a percentage of the face value of the bond. For example, a bond with a 5 percent coupon will pay $5 per $100 face amount of the bond.

CRB - Commodities Research Bureau, an index compiled by Bridge Inc. to measure the overall performance of the commodity futures market.

CREDIT RATING - A grade (usually a letter grade) assigned to a corporate bond that rates its level of risk for the investor. The rating is often used by banks and investors to determine whether to buy the bond, or whether to loan the corporation money. A higher rating means the company stands a better chance of paying back investors. The three main credit rating firms are Moody's, Standard & Poor's and Fitch.

CREDIT UNION - A non-profit financial cooperative that offers financial services similar to a bank for people sharing a common bond, such as working for the same company. Credit unions often offer loans at a lower rate than traditional banks and accounts usually accrue higher interest rates. Credit Unions are regulated by the National Credit Union Administration.

CROSS RATE - The rate of exchange between two currencies calculated by referring to the rates between each and a third currency.


CURRENCY BOARD - An alternative to a central bank, often established in response to economic turmoil. A currency board, which generally includes some foreigners, replaces the central bank and sets a fixed exchange rate. Argentina instituted a currency board in April 1991, creating a new peso worth $1 and requiring the government to hold enough dollars in reserves so that every peso could be exchanged for a dollar. The move drastically cut inflation and also restored Argentina's ability to borrow money at reasonable interest rates. However, currency boards effectively strip a nation of the power to control its own economy. Economic factors such as wages, interest rates, the balance of payments, even rents, adjust to the fixed exchange rate.

CUSIP - Committee on Uniform Security Identification Procedures, the nine-digit identification code for a stock or mutual fund.

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DEFERRED SALES CHARGE - A fee charged when an investor sells back shares during the first few years of ownership.

DEVALUATION - A lowering of the value of a currency relative to other currencies.

DISCOUNT - Interest withheld when a note, draft or bill is purchased.

DISCOUNT RATE - The rate of interest charged by the Federal Reserve on loans it makes to member banks. This rate has an influence on the rates banks charge their customers.

DIVIDEND - A distribution of the company's earnings to shareholders, usually consisting of stock dividends, interest on bonds, or short-term capital gains on the sale of securities usually paid quarterly in the form of cash or stock.

DIVIDEND REINVESTMENT PLAN (DRIP) - Plans that require you to buy just a single share of a company's stock to enroll. Ideal for investors who want to start with a small position in a stock and add to it on a periodic basis and the dividends are automatically reinvested in more shares. An additional advantage is that one can invest in a company without having to pay brokerage commissions or buy 100 or more shares at once - as some brokers require.

DOLLAR VOLUME - The number of shares traded multiplied by the stock price. The resulting figure tells how much money was turned over in the stock on a given day.

DOW JONES INDUSTRIAL AVERAGE - A price weighted index of 30 active blue chip industrial stocks (ATT and American Express, though not industrial, are included). The Average is quoted in points, not dollar value. (

DOW JONES TRANSPORTATION AVERAGE (DJTA) - The oldest U.S. stock index, it measures the performance of 20 companies, from railroads to overnight delivery services, that move things from one place to another.

DOW JONES UTILITIES AVERAGE (DJUA) - An index of 15 leading utility companies. Some analysts believe a rise in utility stock prices is a signal that Wall Street expects interest rates to go down.

DOWNSIDE RISK - The probability that the price of an investment will fall.


DUMPING - Selling a product below cost in a foreign market in order to preserve its domestic market value.


EARNINGS PER SHARE (EPS) - One of the most widely watched numbers on Wall Street. To get the number, take overall earnings for the quarter or the year and divide by the company's total number of outstanding shares. Some companies also supply diluted earnings per share, which includes stock options in the total number of shares outstanding.

EQUITY - The value of property after the amount that is owed on it is subtracted.

EXCHANGE RATE - The price of one currency in terms of another. For example, one French franc may be worth 13.63 cents - or - one dollar is worth 7.33 French francs. Exchange rates fluctuate as currency traders and investors change their perceptions of world events and the stability of each nation's economy and government. Most countries try to maintain somewhat stable rates because this makes investors feel more secure. One way to ensure that stability is to link the currency to a specific amount of a commodity, like silver or gold, and keep a reserve of that commodity equal to the total value of the currency in circulation. Some nations link their currency to the dollar because it is perceived as stable. A linked system is considered "fixed", while a system that relies on market forces is considered "floating". Many strong economies, including the United States, float their currency. Many weaker economies fix their currency, hoping to lock in some security.

EX-DIVIDEND - The point at which new purchasers are no longer eligible for the most recent dividend payment. When the dividend is paid, the NAV or stock price is adjusted to reflect the payment.

EXPENSE RATIO - The fund's cost of doing business, expressed as a percentage of assets.

EXPIRATION DATE - (1) The date on which a futures contract can no longer be bought or sold and the buyer must take possession of the commodities contained in the contract (2) The last day on which an option may be exercised.

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FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) - insures deposits in commercial banks up to $100,000 per account.

FEDERAL FUNDS, FEDERAL FUNDS RATE - Money in excess of what the Federal Reserve says a bank must have on hand to back up deposits. The excess can be lent overnight to banks that need more cash on hand to meet their reserve requirements. The interest rate of these loans is the federal funds rate.

FEDERAL RESERVE SYSTEM - Established by Congress in 1913 to regulate the U.S. banking system. There are 12 regional Federal Reserve Banks and 24 branches. The Fed regulates the money supply of the nation, sets policy and monitors all the banks in the system. (

52-WEEK HIGH - The highest price a stock has reached, including intraday trading, for the past 52 weeks. Also the highest NAV a mutual fund has had for the same period.

52-WEEK LOW - The lowest price a stock has reached, including intraday trading, for the past 52 weeks. Also the lowest NAV a mutual fund has had for the same period.

FISCAL YEAR - The 12-month period that a corporation or governmental body uses for bookkeeping purposes. The federal government's fiscal year starts three months ahead of the calendar year.

FIXED ANNUITY - An annuity where buyers earn a specified return on their money each year for a specified number of years or for life. The account can grow free of yearly income taxes.

FLOAT - (1) Money that has been committed but not yet credited to an account like a check that has been written but has not yet cleared. (2) Removing currency controls like pegs or bands and allowing market forces to determine a currency's value. Market forces could include inflation, stock market rallies or tumbles, political changes, trade conflicts.

FOREIGN EXCHANGE RATE OR FOREIGN CURRENCY RATE - The rate at which money from one country can be exchanged for money from another. In the United States, it is usually expressed as the amount of foreign currency that can be bought for one U.S. dollar; or in the case of the British pound, as the amount of U.S. dollars that one pound will buy.

FORWARD RATE - The rate at which foreign currency is expected to be worth in the future, usually 30, 60 or 90 days ahead. Traders often buy or sell at forward rates to take advantage of the price spread between spot and forward rates. The practice is called covered interest arbitrage.

FULL FAITH AND CREDIT BOND - An alternate term for

GENERAL OBLIGATION BOND - often used to contrast such a bond with a moral obligation bond.

FUTURE - A contract to buy a commodity for a set price in the future. Investors buy futures to take advantage of price discounts, and to guarantee a supply of goods for the future. However, most futures contracts are bought and sold at least once before expiration, as brokers attempt to take advantage of the difference in price to make a profit.

FUTURES MARKET - Where futures contracts are bought and sold. The main markets are: the New York Commodity Exchange, aka Comex (gold, silver); the Coffee, Sugar and Cocoa Exchange; the New York Cotton Exchange; the Chicago Mercantile Exchange (livestock); the New York Mercantile Exchange (fuels); the Chicago Board of Trade (grains); and the New York Futures Exchange (currencies, indexes). Other major markets include the Kansas City Board of Trade, the Minneapolis Grain Exchange and the MidAmerica Commodity Exchange.

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GENERAL OBLIGATION BOND - A bond that has had the formal approval of either the voters or their legislature. The government's promise to repay the principal and pay the interest is constitutionally guaranteed on the strength of its ability to tax the population.


HEDGE - A strategy of protecting against losses - you buy stock hoping it will rise and a "put" stock option in case it doesn't. A "put" option allows you to borrow stock for a fraction of the cost and resell it at a specified time. When that time arrives, if the stock is lower than the price you borrowed it for, you can exercise your option and make a profit. If the price is higher, you let your option expire and lose the money you invested in the option.

HIGH - The highest price a stock reaches during a particular period, such as the daily high, which would be the highest point the stock traded at during the trading day.

HOLDING COMPANY - A company whose principal assets are the securities it owns in companies that actually provide goods or services. The usual reason for forming a holding company is to enable one corporation and its directors to control several companies by holding a majority of their stock.



INDEX - The value of a set group of securities, such as stocks, bonds or mutual funds. Indexes are used to show the relative value of certain securities, such as the Dow Jones utility index, which tracks the utility industry, or the Russell 2000, which tracks small company stocks. The Dow Jones industrial average and Standard & Poor's 500 are the most widely tracked indexes in the United States.

INDEX OPTION - An option based on an index. It allows investors to bet on the future direction of an index, without having to invest in the individual stocks in the index. A prospective buyer can buy an Index Option on oil rather than buying options on several oil companies.

INITIAL PUBLIC OFFERING (IPO) - The first sale of common stock by a private company.

INTERMARKET TRADING SYSTEM (ITS) - Links all the stock exchanges and allows brokers to trade in other regional markets. Part of the National Markets System.

INTERNATIONAL MONETARY FUND (IMF) - A supply of money supported by subscriptions of member nations, for the purpose of stabilizing international exchange and promoting orderly and balanced trade. Member nations may obtain foreign currency needed, making it possible to correct temporary maladjustments in their balance of payments without currency depreciation. (

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JUNK BOND - A bond with a lower credit rating. It usually has a higher yield for investors but may be riskier because of the company's financial standing.


KANSAS CITY BOARD OF TRADE (KBOT) - Trades grains, livestock, food, fibers and the Value Line Indexes. (


LAST - The price of the last trade of the day for a particular stock or bond.

LIBOR - London InterBank Offer Rate

LIFFE - London International Financial Futures Exchange

LIPPER - A service that provides information and analysis of mutual funds. (

LIQUIDATION - Converting stock or other assets into cash.

LIQUIDITY - The ease with which assets can be converted to cash, without loss or value.

LOAD - The amount investors are charged to buy shares in a fund. This amount is added to the NAV when determining the offer price. Also known as sales charge.

LOW - The lowest price a stock reaches during a particular period, such as the daily low, which would be the lowest point the stock traded at during the trading day.

LOW-LOAD - A smaller amount investors are charged to buy shares in a fund (1 or 2 percent - instead of 4 percent or more).

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MARGIN - The practice of purchasing securities in part with borrowed money, using the purchased securities as collateral in anticipation of an advance in the market price. If the advance occurs, the purchaser may be able to repay the loan and make a profit. If the price declines, the stock may have to be sold to settle the loan. The margin is the difference between the amount of the loan and the value of the securities used as collateral.

MARKET CAPITALIZATION - A statistic that is often used to reflect the size of a company. To determine a company's "market cap" multiply total shares of outstanding common stock by the most recent stock price.

MATURITY DATE - The date on which a bond becomes redeemable. When the bond is redeemed, the debtor must repay the bondholder the face value of the bond.

MIDAMERICA COMMODITY EXCHANGE (MCE) - Trades currency, livestock, grain, precious metals and financial futures.

MIDW - Midwest Stock Exchange (Chicago)

MINIMUM INITIAL INVESTMENT - The minimum amount of money that an investor must put up in order to buy shares in a mutual fund.

MINNEAPOLIS GRAIN EXCHANGE (MGEX) - Grain exchange in Minneapolis, Minnesota. (

MONEY MARKET FUND - A type of mutual fund that invests in short term securities. It is one of the most popular liquid investments because shareowners have check-writing capabilities and instant access to their funds.

MORAL OBLIGATION BOND - A government bond that has not had the formal approval of either the voters or their legislature. It is backed only by the government's "moral obligation" to repay the principal and interest on time.

MORNINGSTAR - provider of mutual fund, stock, and variable-insurance investment information. (

MUNICIPAL BOND - A general obligation bond issued by a state or local government. These bonds are often tax-exempt for residents of the municipality.

MUTL - Mutual Fund

MUTUAL FUND - A company organized to pool and invest money received from its shareholders. The fund manager invests the money in stocks, bonds or other securities according to the fund's investment goals. Investors make money (1) from dividends or interest earned on the stocks or bonds in the portfolio, or (2) from any profits made on the sale of securities held in the portfolio, which are known as capital gains.

MUTUAL FUND (OPEN-END FUND) - A PORTFOLIO of stocks/bonds/money-market-instruments administered by an investment company with a specific OBJECTIVE in mind.

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NASD - The National Association of Securities Dealers; also see Nasdaq. (

NASDAQ - National Association of Securities Dealers Automated Quotations system. A system, owned and operated by the National Association of Securities Dealers, which reports trading of over the counter and selected NYSE stocks. (

NASDAQ BANKING - This index includes about 350 banks and bank-related companies such as check-cashing agencies and safe deposit companies.

NASDAQ COMPOSITE - This broad-based index measures the performance of the Nasdaq Stock Market. It tracks more than 5,000 companies and is considered a gauge of how technology stocks are faring.

NASDAQ COMPUTER - This index includes about 560 computer hardware and software companies along with companies that make computers, office equipment and electronic components.

NASDAQ FINANCIAL SERVICES - This index consists of the 100 largest financial organizations listed on the Nasdaq.

NATIONAL MARKETS SYSTEM (NMS) - Created in 1975 by the SEC because Congress wanted a way to foster competition between exchanges to better benefit customers. The Intermarket Trading System is part of the NMS. NAV


NDOE - Nasdaq Options

NET ASSET VALUE - The price of a single share in a fund. Calculated by dividing the total net assets in the fund by the number of shares.

NET INCOME - The amount left over after a company deducts costs and expenses from revenue. Also known as net earnings, net income may be expressed as a total number, or on a per-share basis, which is found by dividing the total net income by the number of shares of common stock outstanding.

NEW YORK BOARD OF TRADE (NYBOT) - parent company of the Coffee, Sugar and Cocoa Exchange, Inc. (CSCE) and the New York Cotton Exchange (NYCE). Through its two exchanges and their subsidiaries and divisions, including the New York Futures Exchange (NYFE), FINEX, and Citrus Associates, NYBOT offers a wide variety of agricultural, currency and index products.

NEW YORK COMMODITIES EXCHANGE (CMX) - Also known as the Comex. Trades precious metals, copper and financial indexes.

NEW YORK MERCANTILE EXCHANGE (NMER) - Trades petroleum, natural gas and precious metals. (

NEW YORK STOCK EXCHANGE (NYSE) - The oldest and largest exchange in the U.S. (


NO-LOAD FUND (NL) - A fund without a sales charge.

NOTE - A certificate issued by a corporation or government stating the amount of a loan, the interest to be paid and the collateral pledged in the event payment cannot be made. The date for repayment is generally more than a year after issue but not more than seven or eight years later. The shorter interval for repayment is the principal difference between a note and a bond.

NQBD - Nasdaq Bonds (over the counter)

NYBD - New York Stock Exchange Bonds

NYOE - New York Stock Exchange Options.

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OBJECTIVE - A fund's investment goals. These goals may include stability, growth, income, or a combination. For a full list of objectives click here.


OFFICE OF THE COMPTROLLER OF THE CURRENCY (OCC) - An arm of the Treasury that is the chief regulator of national banks. It is also a director of the FDIC.(


OPEN INTEREST - The total number of futures contracts that are still available to be bought and sold for a particular commodity. Open interest is an indicator of how much interest there is in the contract.

OPEN PRICE - The day's first trading price for a contract.

OPTION - The right to buy a stock, commodity or other financial instrument at a future date and for a set price. In general, if the right is not exercised by the specified date, the option expires and the buyer forfeits his or her money.

OTC - Over the Counter stocks. These are stocks that are not listed or traded on an exchange, but rather through a computer/telephone network linking security traders. (


PBOE - Philadelphia Board of Options Exchange PCOE - Pacific Options Exchange ( See REGIONAL STOCK EXCHANGES


PEG - A tie to a currency or a fixed exchange rate, usually established by government intervention. For more than a decade, Hong Kong has pegged its currency at the rate of 7.8 Hong Kong dollars to one U.S. dollar.

PENNY STOCK - A stock that sells for less than $1 a share.

PERCENT CHANGE - The percentage difference of the current price from the previous trading day, week, quarter or year.

PORTFOLIO - A diverse group of investments in various stocks, bonds and money market instruments generally with a specific objective in mind.


PREFERRED STOCK - A class of shares in a public corporation with different - usually more desirable - rights than common stock. Preferred stock pays a set dividend, and may receive different voting rights in the company's business. Owners have preference over common stockholders in the payment of dividends and liquidated assets.

PRICE WEIGHTED INDEX - Index wherein the higher priced component stocks have a greater percentage impact on the index than do lower priced stocks. The Dow Jones industrial average is a price weighted Index.

PRICE/EARNINGS RATIO (PE), also called PRICE/SALES RATIO - The price of a stock divided by its earnings per share. PEs are used to gauge the relative worth of a company' stock. When compared to other companies in the same industry, the companies with the lowest PEs are generally earning higher profits.

PRIME RATE - A benchmark rate used by banks to set interest charges on a variety of corporate and consumer loans, including some adjustable home mortgages, revolving credit cards and business loans. Banks set the rate based on their borrowing costs, as reflected by the interest on short-term Treasury securities in the bond market.

PROJECTED PRICE EARNINGS RATIO (PPE) - A PPE that's higher than the current PE indicates analysts expect earnings to go down. A lower PPE indicates analysts think earnings will go up.

PROXY STATEMENT - A legal document that gives information on company changes that requires shareholder approval.

PUT (BONDS) - Bond holder's right to redeem a bond before maturity.

PUT (OPTIONS) - The right to sell a specific number of shares at a specified price by a certain date.

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REGIONAL STOCK EXCHANGES - These include Boston (, Cincinnati (, Intermountain (Salt Lake City), Midwest (Chicago), Pacific (Los Angeles and San Francisco) (, Philadelphia (includes Miami) ( and Spokane. Trading on these markets is reported on the ITS (Intermarket Trading System).

REVENUE - The total amount of money a company takes in from the sale of goods and services, as well as interest on the company's investments.

REVENUE BOND - A bond backed only by the revenue of the airport, turnpike or other facility that was built with the money it raised.

RIGHT - An offering to shareholders to buy new issues in a corporation before the issues are offered to the public.

ROLLING VOLUME AVERAGE - The average volume for a stock for a given period of time.

RUSSELL 2000 - A popular measure of how small-company stocks are doing, this index tracks 2,000 companies whose average market capitalization is $255 million.


S&P 500 - One of the most widely followed benchmarks on Wall Street. It consists of 500 companies selected on size, activity and industry group. ( Also see STANDARD & POOR'S

S&P SMALL CAP 600 - This index tracks the performance of 600 small companies. ( Also see STANDARD & POOR'S


SEASON HIGH/LOW - The highest and lowest price at which a contract has traded in the time the contract has been available in the market.

SEC - Securities and Exchange Commission. A federal agency established in 1934 to oversee to protect the investment community from fraud and dishonest selling practices. (


SETTLEMENT PRICE - The final price at which a contract trades for the day.

SG&A EXPENSES - Selling, General and Administrative Expenses

SHARES OUTSTANDING - The total number of shares of common stock that is being bought, sold or held by investors.

SHORT SALE - The sale of a stock or security when an investor expects a drop in the price. The investor borrows the stock and, after the price has dropped, will purchase the shares to make a profit.

SPOT MARKET - Where commodities are bought and sold for cash, in exchange for the immediate delivery of goods. Also called the cash market.

SPOT RATE - The rate at which foreign currency will be exchanged immediately on the open market.

SPREAD - The difference between bid and ask prices.

STANDARD & POOR'S - A company that rates stocks and bonds and provides investment services. (

STOCK - A share in a company. Companies usually sell stock on order to raise money, share risk, or share in the costs of running the company. The most popular kind is called common stock, which normally entitles the owner to share of the company's profits and voting rights in business affairs.

STOCK EXCHANGE - Organized trading floors, such as the NYSE and Amex, where orders from brokers filter through specialists who buy and sell shares of stock. Nasdaq is an electronic marketplace with no central trading floor and is not technically considered an exchange.

STRIKE PRICE - The price at which the underlying security can be bought or sold before the option expires.

STRIP - A type of bond whose interest payment has been separated from the bond itself, resulting in a zero-coupon bond.

STUB NAME - The abbreviated company name that appears in the 'name' field of most newspapers.

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TICKER - The one to five character identifier for every stock or mutual fund.

TICKER SYMBOL - A combination of letters that identifies a stock, fund or index.

TOTAL NET ASSETS - The total amount invested in a fund, usually expressed in millions of dollars.

TOTAL RETURN - The change in NAV for a stated time period, adjusted for dividends and other distributions. It shows the fund's relative performance, compared to other types of investments and other funds with the same investment objective.

TOUTING - When someone is paid by a company to promote that company's stock. Touting is legal as long as all income is reported.

TREASURIES - Securities sold by the U.S. government to raise money for the Treasury. They come in three denominations: A bill is usually due three months to one year after it is issued; a note is due one to 10 years after it is issued; and a bond matures 10-30 years after it is issued. (For more information go to:(

TREASURY BILL (TBILL) - A certificate representing a loan to the federal government that matures in three, six or 12 months.

TREASURY BOND (TBOND) - A certificate representing a loan to the federal government that matures in seven years or more.

TREASURY NOTE - A certificate representing a loan to the federal government that matures in one to 10 years or more.

12b-1 FEE - The fee some mutual funds charge to pay for distribution costs, such as advertising and dealer compensation.


UNDERLYING PRICE - The closing price for the option's security on a given day or week. For stock options, this price will be the closing price for the stock on the stock exchange. For commodity futures, it will be the settlement price on the future's commodity exchange.

USBN - U.S. Treasury Bonds and Notes. see TREASURIES

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VARIABLE ANNUITY - An annuity where the policyholder buys a right to receive regular benefit payments. However, the payoff isn't known ahead of time and fluctuates with market conditions. The policyholder directs how the premium payments are invested and can move them around at will, tax-free.

VOLUME - The number of shares traded, usually expressed in hundreds on any given day.

VOLUME SURGE - The percentage of a company's shares outstanding that actually trade in a given day or week. It helps show how actively a stock was traded.


WARRANT - A security - usually issued with a bond - that entitles the owner to buy stock at a specified price. Warrants are usually issued to entice prospective bondholders into buying bonds.

WBNK - World Bank (

WCMX - Winnipeg Commodity Exchange (

WHEN-ISSUED - Trades made in a security before the stock is actually offered to the public. The trades are allowed because there is sufficient interest in buying and selling the new security, even though the shares are not yet available.

WILSHIRE 5000 - The broadest gauge of the U.S. stock market, this index measures the performance of all companies with U.S. headquarters and readily available price data. It tracks more than 7,000 companies. (


YIELD - The dividend divided by the stock price. It helps gauge how well the stock is paying, compared to other investments such as CDs, bonds or savings accounts.

YIELD (BOND) - The amount a bond pays in interest, expressed as a percentage of the purchase price. For example, a bond with a 10 percent coupon that cost $1,000 has a current yield of 10 percent. Bond yields are expressed in basis points, with 32 basis points per unit.


ZERO-COUPON BOND - A bond that does not pay periodic interest. These bonds are usually sold at a deep discount from their face value. For example, a zero-coupon bond redeemable for $1,000 at maturity may cost only $500 when it is purchased.

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