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

Category: Finance Dictionary

STRIP HEDGE

A prediction of future cash flows and directional and curve risks of over the counter or exchange traded options. Refer to rolling hedge.

SWING TRADING

A short term buying and selling strategy. It takes advantage of the overreactions. Refer to position trading.

TAKEOVER BID

The price paid for a company. Refer to anyandall bid, two tier bid, and take over.

THETA

An options value changes over time if all variables are constant. AKA omega. Refer to delta, gamma, greeks, rho, time decay, time value, and vega.

TOBIN

A ratio expressing the earnings needed. If below a 1 it needs more cash flow if above a 1 it is doing well on its return rate.

TRENDLINE

A chart connecting the lowest and highest prices over time to display the assets trend.

UMBRELLA POLICY

Additional insurance to cover specific liabilities or perils. It works with current insurance to fill gaps.

UP AND IN OPTION

An option that creates an european option if the price goes beyond a barrier. Refer to barrier, down and in, down and out, reverse knockin, knockin, and up and out options.

VIS MAJOR

Means overpowering force. An unavoidable event that will effect the profits of the firm. Risk transfer is sought in this case. Refer to force majuere.

WHISPER NUMBERS

Releasing corporate earnings before a full public announcement. The US limits this by prohibiting selective disclosure.

ZAIBATSU

A japanese congromerate with one company taking control. It has been banned since the mid 1940s and is replaced by keiretsu.

INFLATION-LINKED SECURITY

A bond that guarantees a return based on inflation. The coupon is the fixed rate and the principal adjusts according to the changing inflation rates. Refer to the terms ajustabonos and treasury

JENSEN INDEX

A way to asses risk by comparing potential risk against a portfolios possible returns.

JUMPING JUVENILE

When a child turns 21, the child’s insurance policy of this type automatically increases value without additional proof of insurability. Such a policy written on a child is typically in units of

JUST IN TIME INSTRUCTION

To avoid a time gap and loss of retention, required knowledge and skills are learned for immediate application in this training scheme.

KELLER PLAN

Learning material presented in small units of personalized instruction. Behavioral psychologist Fred Keller, developed this approach, which bears his name. Instructors only facilitate, grade as pass or fail, administer no punishment at

KEY PROCESS

Customer service and satisfaction, competitive advantage, and strategic success are essential business workflows In management’s view.

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