Business / Finance Glossary

Annualized Holding-Period Return: The annual rate of return that when compounded t times generates the same t-period holding return as actually occurred from period 1 to period t.

Annuitant: An individual who receives benefits from an annuity.

Annuitize: To commence a series of payments from the capital that has accumulated in an annuity. The payments may be a fixed amount, for a fixed period of time, or for a lifetime.

Annuity: A regular periodic payment made by an insurance company to a policyholder for a specified period of time.

Annuity Certain: An annuity that pays a specific amount on a monthly basis for a set amount of time.

Annuity Due: An annuity with n payments, where the first payment is made at time t = 0, and the last payment is made at time t = n - 1.

Annuity Factor: Present value of $1 paid for each of t periods.

Annuity In Arrears: An annuity with a first payment one full period hence, rather than immediately.

Annuity Starting Date: The date when an annuitant starts receiving payments from an annuity.

Anticipated Holding Period: The period of time an individual expects to hold an asset.

Anticipation: Paying what is owed before it is due (usually to save interest charges).

Antidilutive Effect: Result of a transaction that increases earnings per common share (e.g., by decreasing the number of shares outstanding).

Antitrust Laws: Legislation established by the federal government to prevent the formation of monopolies and to regulate trade.

Any-Interest-Date: A call provision in a municipal bond indenture that establishes the right of redemption for the issuer on any interest payment due date.

Any-Or-All Bid: Often used in risk arbitrage. Takeover bid in which the acquirer offers to pay a set price for all outstanding shares of the target company, or any part thereof; contrasts with two-tier bid.

Any-Part-Of Order: In context of general equities, order to buy or sell a quantity of stock in pieces if necessary. Antithesis of an all-or-none order (AON).

Appraisal Ratio: The signal-to-noise ratio of an analyst's forecasts. The ratio of alpha to residual standard deviation.

Appraisal Rights: A right of shareholders in a merger to demand the payment of a fair price for their shares, as determined independently.

Appreciation: Increase in the value of an asset.

Appropriation Request: Formal request for funds for capital investment project.

Approved List: A list of equities and other investments that a financial institution or mutual fund is approved to make. See: Legal list.

APS: Auction Preferred Stock. A type of Dutch Auction Preferred Stock (Goldman Sachs product).

Arbitrage: The simultaneous buying and selling of a security at two different prices in two different markets, resulting in profits without risk. Perfectly efficient markets present no arbitrage opport . . . View Full Definition

Arbitrage Bonds: Municipality issued bonds issued intended to gain an interest rate advantage by refunding a higher-rate bond in ahead of their call date. Lower-rate refunding issue proceeds are invested in . . . View Full Definition

Arbitrage Pricing Theory (APT): An alternative model to the capital asset pricing model developed by Stephen Ross and based purely on arbitrage arguments. The APT implies that there are multiple risk factors that need to b . . . View Full Definition

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