Your Free Online Legal Dictionary • Featuring Black’s Law Dictionary, 2nd Ed.

Category: Finance Dictionary

NET WORTH

Firm’s value to its owners, typically stockholders or shareholders. Value is usually shown on the firm’s balance sheet. Issued share capital plus retained earnings plus capital gains equals net worth. Also known

NETWORK SERVICE PROVIDER (NSP)

Entity as a high volume data capacity renter to limited internet service providers (ISP) who rent capacity to several internet users, known as subscribers.

NEW OLD STOCK

Items in stock, still in their original packaging, never sold. Also known as new unused stock or surplus stock.

NEWS CORPORATION

Founded by Rupert Murdoch, this media company is global, vertically-integrated. Day-to-day corporate operations primarily occur in the US, Continental Europe, Australia, Asia, Latin America, and the UK. Every media, film, cable, magazines,

NIGERIAN SCAM

Mail and email fraud based on false pretenses tempting people to send money or disclosed banking account information. The scam is someone inherited a large sum of money and needs assistance to

NO COST CHANGE

Overhead costs may occur but not affect a contract’s prices when a contract changes.

NOAH EFFECT

A continuous factors’ series suffering abrupt, disconnected interruptions. These changes affect value distribution all along the continuum, often skipping values in an upward or downward direction. Also refer to Joseph Effect, anti-persistence,

NON-COMPETITIVE TRADING

A dealer who does not expose his trading to the market and just gives it to his clients. This is illegal.

NO-SHOP CLAUSE

An agreement clause between an owner and a prospective buyer to suspend all other purchase negotiations for a stated time period. In other words, the seller agrees to stop seeking other acquisition

OPEN OUTCRY

When floor traders agree on terms by communication or hand signals.

PAPER SWAP

A swap made only in paper form. Or trade in the paper products line.

PAYOUT RATIO

The amount of earnings paid to stockholders over the investments lifetime. This payment takes the form of common stock dividends. Refer to dividend yield and plowback ratio.

PLOWBACK RATIO

The amount of capital reinvested that are not paid to shareholders in the form of dividends.

POSITIVE GAMMA

When option purchases expose an investment to a larger price market. Refer to gamma and negative gamma.

PREMIUMS IN FORCE

The amount an insurer underwrites based on its premiums collected on active policies.

PROPORTIONAL AGREEMENT

When an insurer must take their share of the losses based on a fixed or variable percentage or monetary value. Refer to excess of loss agreement.

PUT ON ACALL

An option where the buyer can sell underlying call option back to the seller. Refer to call on a call, call on a put, and put on a put.

RABBI TRUST

a trust wherein the employee is not taxed because the plan’s assets can be claimed by creditors. This name is used because the first of these type of trusts was set up

RECISSION

Cancelling insurance due to fraud or misrepresentation.

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