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Financial Glossary

C

CAC 40 index A broad-basedindex of common stocks composed of 40 of the 100 largest companies listed on the forward segment of the official list of the Paris Bourse. Cage A section of a brokerage firm used for receiving and disbursing funds. Calendar List of new issues scheduled to come ...

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Condor

Applies to derivative products. Option strategy consisting of both puts and calls at different strike prices to capitalize on a narrow range of volatility. The payoff diagram takes the shape of a bird. See also bull spread

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Beta

A measure of how a stock’s movement correlates to the movement of the entire stock market. The Beta is not the same as volatility. See also Standard Deviation and Volatility. See also stocks

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Bull Spread

An option strategy that achieves its maximum potential if the underlying security rises far enough, and has its maximum risk if the security falls far enough. An option with a lower striking price is bought and one with a higher striking price is sold, both generally having the same expiration ...

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Bear Spread

An option strategy that delivers its maximum profit when the underlying stock declines and has its maximum risk if the stock rises in price. The strategy can be implemented with either puts or calls. In either case, an option with a higher striking price is purchased and one with a ...

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Bank run (bank panic)

A series of unexpected cash withdrawals caused by a sudden decline in depositor confidence or fear that the bank will be closed by the charteringagency, i.e. many depositors withdraw cash almost simultaneously. Since the cash reserve a bank keeps on hand is only a small fraction of its deposits, a ...

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B

Back-end loan fund A mutual fund that charges investors a fee to sell (redeem) shares, often ranging from 4% to 6%. Some back-end load funds impose a full commission if the shares are redeemed within a designated time period after purchase, such as one year, reducing the commission the longer ...

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A

Accrued Interest Interest earned between the most recent interest payment and the present date but not yet paid to the lender. Accredited investor Refers to a person whose net worth, or joint net worth with a spouse, exceeds $1,000,000; or whose individual income exceeded $200,000 or whose joint income with ...

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