Related Words

Round-Trip Transactions Costs: Costs of completing a transaction, including commissions, market impact costs, and taxes.

Transactions Motive: The time, effort, and money necessary, including such things as commission fees and the cost of physically moving the asset from seller to buyer. Related: Round-trip transactions costs, info . . . View Full Definition

Standard Costs: Investment approach that advocates a firm should accept or reject a project by comparing it with securities in the same risk class.

Search Costs: Costs associated with locating a counterparty to a trade, including explicit costs (such as advertising) and implicit costs (such as the value of time). Related: Information costs.

Round-Trip Trade: The purchase and sale of a security within a short period of time.

Noncash Transactions: Investing and financing activities that do not affect cash: if significant, they are disclosed below the statement of cash flows or in the notes to the financial statements.

Opportunity Costs: The difference in the performance of an actual investment and a desired investment adjusted for fixed costs and execution costs. When not all desired trades can be implemented. Most valuable . . . View Full Definition

Price Impact Costs: Related: Market impact costs

Standard Costs Plus Variances: A target or average cost that can be used either to value inventory or as a basis of comparison with actual costs. Standard costs can often be used to calculate cost of sales, in which case . . . View Full Definition

Trading Costs: A document (power of attorney) a customer gives to a broker in order that the broker may buy and sell securities on behalf of the customer.