Dutch Auction Preferred Stock: Auction in which the lowest price necessary to sell the entire offering becomes the price at which all securities offered are sold. This technique has been used in Treasury auctions. Often used in risk arbitrage. The price of an item (stock) is gradually lowered until it elicits a responsive bid (government T-bills) or offer (corporate repurchase) and is sold. In a corporate repurchase, the company sets a range of prices within which shareholders are invited to tender their shares. The tender offer is open for a specific period of time (i.e., 20 days), and the quantity of stock to be purchased is stated as well, subject to prorating if more shares are tendered than can be legally purchased under the stated terms (often an additional amount equal to 20% of outstanding shares can be purchased). Compare to double auction system.

 

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Dutch Auction Preferred Stock: Auction in which the lowest price necessary to sell the entire offering becomes the price at which all securities offered are sold. This technique has been used in Treasury auctions. Often u . . . View Full Definition

Auction Market Preferred Stock (AMPS): A type of Dutch Auction Preferred Stock (A Merrill Lynch product).

Second-Preferred Stock: Preferred stock issue that has less priority in claiming dividends and assets in liquidation than another issue of preferred stock.

Screen Stocks: To analyze various stocks in search of stocks that meet predetermined criteria. For example, a simple value screen would sort all stocks by their price-to-book ratio and pick the stocks with . . . View Full Definition