Business / Finance Glossary

Protect: Assure the salesperson or trader that interest, buy or sell, will be attended to, given any change in the trading circumstances, as follows: At a price: If the stock trades at a certain pric . . . View Full Definition

Protectionism: Notion that governments should protect domestic industry from import competition by means of tariffs, quotas, and other trade barriers.

Protective Covenant: A part of an indenture or loan agreement that limits certain actions a company may take during the term of the loan to protect the lender's interests.

Protective Put Buying Strategy: A strategy that involves buying a put option on the underlying security that is held in a portfolio. Related: Hedge option strategies.

Provision For Income Taxes: An amount on the P & I statement that estimates a company's total income tax liability for the year.

Provisional Call Feature: A stipulation in a convertible issue that allows the issuer to call the issue during the noncall period if the price of the stock reaches a certain level. In the case of convertible securiti . . . View Full Definition

Proxy: Authorization, whether written or electronic, that shareholders' votes may be cast by others. Shareholders can and often do give management their proxies, delegating the right and responsibi . . . View Full Definition

Proxy Contest: A battle for the control of a firm in which a dissident group seeks, from the firm's other shareholders, the right to vote those shareholders' shares in favor of the dissident group's slate . . . View Full Definition

Proxy Fight: Often used in risk arbitrage. Technique used by an acquiring company to attempt to gain control of a takeover target. The acquirer tries to persuade the shareholders of the target company th . . . View Full Definition

Proxy Statement: Document intended to provide shareholders with information necessary to vote in an informed manner on matters to be brought up at a stockholders' meeting. Includes information on closely hel . . . View Full Definition

Proxy Vote: Vote cast by one person or entity on behalf of another.

Prudent-Man Rule: A common law standard against which those investing the money of others (fiduciaries) are judged.

PSA Prepayment Rate: The Bond Market Trade Association's Mortgaged Asset-Backed Securities Division's prepayment model based on an assumed rate of prepayment each month of the then unpaid principal balance of a . . . View Full Definition

PSSG: Financial ratio defined as stock price divided by sales over sales growth. Often used in the valuation of Internet stocks. Related: PREG.

Public Debt: Issues of debt by governments to compensate for a lack of tax revenues.

Public Housing Authority Bond: Bonds of local public housing agencies that are secured by the federal government and whose proceeds are used to provide low-rent housing.

Public Limited Partnership: A limited partnership with an unlimited number of partners that is registered with the SEC and is available for public trading by broker/dealers

Public Offering: Used in the context of general equities. Offering to the investment public, after compliance with registration requirements of the SEC, usually by an investment banker or a syndicate made up . . . View Full Definition

Public Offering Price: The price of a new issue of securities at the time that the issue is offered to the public.

Public Ownership: The portion of a company's stock that is held by the public.

Public Securities Administration (PSA): The trade association for primary dealers in U.S. government securities, including MBSs.

Public Utility Holding Company Act Of 1935: Legislation intended to eliminate many holding company abuses by reorganizing the financial structures of holding companies in the gas and electric utility industries and regulating their de . . . View Full Definition

Public Warehouse: Storage facility operated by an independent warehouse company on its own premises.

Public-Purpose Bond: A specific type of municipal bond used to finance public projects such as roads or government buildings. Interest on municipal bonds is federal income tax-free.

Publicly Held: Describes a company whose stock is held by the public, whether individuals or business entities.

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