Business / Finance Glossary

AIMR Performance Presentation Standards Implementation Committee: The Association for Investment Management and Research (AIMR) Performance Presentation Standards Implementation Committee is charged with the responsibility to interpret, revise, and update . . . View Full Definition

Air Pocket Stock: A stock whose price drops precipitously, often on the unexpected news of poor results.

Alien Corporation: A company incorporated under the laws of a foreign country regardless of where the company conducts its operations.

All Equity Rate: The discount rate that reflects only the business risks of a project, distinct from the effects of financing.

All In: Refers to an issuer's interest rate after accounting for commissions and various related expenses.

All Or None Order (AON): Used in context of general equities. A limited price order that is to be executed in its entirety or not at all (no partial transaction), and thus is testing the strength/conviction of the c . . . View Full Definition

All Ordinaries Index: The major index of Australian stocks comprising 330 of the major companies listed on the Australian Stock Exchange.

All-In Cost: Total costs, explicit and implicit.

All-Or-None Underwriting: An arrangement whereby a security issue is cancelled if the underwriter is unable to resell the entire issue.

Allied Member: A partner or stockholder of a firm that is a member of the NYSE, the partner or stockholder is not personally a member of the NYSE.

Alligator Spread: The term used to describe a spread in the options market that generates such a large commission that the client is unlikely to make a profit even if the markets move as the investor anticipated.

Allotment: The number of securities assigned to each of the participants in an underwriting syndicate.

Alpha: Measure of risk-adjusted performance. An alpha is usually generated by regressing the security or mutual fund's excess return on the S&P 500 excess return. The beta adjusts for the risk (the . . . View Full Definition

Alpha Equation: Regression usually run over 36-60 months of data: Return-Treasury bill= alpha + beta (S&P 500 - Treasury bill) + error. The alpha is the intercept. Note that the benchmark does not necessari . . . View Full Definition

Alphabet Stock: Categories of common stock of a corporation associated with a particular subsidiary resulting from acquisitions and restructuring. The various alphabetical categories have different voting r . . . View Full Definition

Alternative Minimum Tax (AMT): A federal tax aimed at ensuring that wealthy individuals, estates, trusts, and corporations pay a minimal level income tax. For individuals, the AMT is calculated by adding adjusted gross in . . . View Full Definition

Alternative Mortgage Instruments: Variations of mortgage instruments such as adjustable-rate and variable-rate mortgages, graduated-payment mortgages, reverse-annuity mortgages, and several seldom-used variations.

Alternative Order: Used in context of general equities. Order giving a broker a choice between two courses of action, either to buy or sell, never both. Execution of one course automatically eliminates the oth . . . View Full Definition

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