International Dictionary of the Securities Industry

Frontmatter

A

Abstract

‘AAA’ or ‘Triple A’ rating (US). The highest rating awarded to PREFERRED STOCK by credit rating agencies such as Standard and Poor’s Corporation. Such agencies also tend to rate bonds similarly and to have an additional classification for common stocks (ordinary shares). See also STANDARD AND POOR’S RATINGS.

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B

Abstract

baby bond (US). A bond with a nominal value lower than the conventional amount of $1000.

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C

Abstract

cabinet bid. A facility in a TRADED OPTIONS market whereby, when no tangible value applies to a deep OUT-OF-THE-MONEY OPTION, the holder may dispose of contracts to a market maker at a nominal price per contract (of 1p in the United Kingdom).

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D

Abstract

Dachgesellschaft (Ger). See HOLDING COMPANY.

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E

Abstract

early deposit (UK). The deposit with the TALISMAN settlement centre of stock by selling brokers in advance of settlement day. The stock is held in trust until delivery on the settlement day.

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F

Abstract

face value. Sometimes referred to as nominal or PAR value, face value is the term used to describe the value of a bond in terms of what the company will repay when the loan matures.

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G

Abstract

gap (US). The word used to describe a situation where the range of prices at one TRADING SESSION does not overlap the TRADING RANGE at the previous session.

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H

Abstract

half-commission man (UK). The employee of a stockbroking firm who is remunerated not by a salary (although he may be paid a small annual retainer) but by being paid a half of the commission on business which he has brought to the firm. The half-commission man is less prevalent now than he used to be on the Stock Exchange, although ASSOCIATED MEMBERS may still share in the profits of their firms by way of an annual bonus.

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I

Abstract

identification rules (UK). Rules laid down in the Finance Act 1982, in connection with the INDEXATIONOFCAPITALGAINSTAX. Prior to 1982, whenever an investor bought or otherwise acquired more of the same CLASS OF SHARES, they were pooled with all others of that class and a single pool price calculated. When part of the pool was disposed of, the pool price was that used for calculating any liability to Capital Gains Tax.

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J

Abstract

Jahresabschluss (Ger). Annual accounts. Jahresbericht (Ger). Annual report. Jahreshauptversammlung (Ger). See ANNUAL GENERAL MEETING. Japan Securities Finance Company (Jap). One of the three securities finance companies whose role is to lend stock or cash to securities houses and thus help liquidity in the Japanese markets. Formed originally in 1927, the Japan Securities Finance Company dealt with the needs of the members of the Tokyo Stock Exchange. Following a reorganization in 1956, it now covers the Sapporo, Nagoya and Fukuoka exchanges as well. See also OSAKA SECURITIES FINANCE COMPANY, CHUBU SECURITIES FINANCE COMPANY.

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K

Abstract

Kaffirs. The name given to South African gold mining stocks. At one time the main market in such shares was in London, and although Johannesburg and even New York now trade extensively in them, a major market still exists in London, where a considerable number of these stocks are listed.

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L

Abstract

lame duck. A term applied in the 19th century to a jobber who was unable to comply with his bargains; now a general term for an industrial company unable to stand on its own financial feet and in need of state support.

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M

Abstract

mainstream Corporation Tax (UK). See CORPORATION TAX. maintenance margin. In a FINANCIAL FUTURES contract, the minimum margin which a customer must keep in his account with a member of the futures exchange in respect of all OPEN CONTRACTS after deducting all amounts due for the INITIAL MARGIN and the VARIATION MARGIN.

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N

Abstract

Naamloze Vennootschap (NV) (Neth). The most common type of organization for a company whose shares are traded on the Amsterdam Stock Exchange. Similar in concept to the British PUBLIC LIMITED COMPANY.

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O

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P

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Q

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R

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S

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T

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U

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V

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W

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X

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Y

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Z

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