APFinancial Representatives

Legal list
A list of high-quality debt and equitysecurities chosen by a state agency that are acceptable holdings for fiduciary institutions.

Legal monopoly
A government-regulatedfirm that is legally entitled to be the only companyoffering a particular service in a particular area.

Legal opinion
A statement, usually written by a specialized law firm, required for a new municipal bondissue stating that the issue is legally acceptable.

Legal risk
The risk associated with the impact of a defect in the documentation on cash flow or debt service.

APFinancial Seminars & Workshops

Insured bond
A municipal bond backed both by the credit of the municipal issuer and by commercial insurance policies.

Insured plans
Defined benefit pension plans that are guaranteed by life insurance products. Related: Non-insured plans

Insured Trade Acceptance
A trade acceptance where the buyer's ability to pay is insured.

Intangible asset
A legal claim to some future benefit, typically a claim to future cash. Goodwill, intellectual property, patents, copyrights, and trademarks are examples of intangible assets.

Integer programming
Variant of linear programming in which the solution values must be integers.

Integrated financial market
A market in which there are no barriers to financial flows, and the same risk asset commands the same expected return, irrespective of domicile.

APFinancial traditional bank instruments

APFinancial Investments: Scale
Payment of different rates of interest on CDs of varying maturities. A bank is said to "post a scale." Commercial paperdealers also post scales.

Scale-enhancing
Describes a project that is in the same riskclass as the whole firm. That is, the project allows the firm to grow larger in the context of their current business rather than diversify into new businesses.

Scale in
Gradually taking a position in a security or market over time.

Scale order
Order to buy (sell) a security that specifies the total amount to be bought (sold) and the amount to be bought (sold) at successively decreasing (increasing) price intervals; often placed in order to average the price.
APFinancial Job Offers
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Vesting
Nonforfeitable ownership (or partial ownership) by an employee of the retirement account balances or benefits contributed on the employees behalf by an employer. The Tax Reform Act of 1986 established minimum vesting rights for employees based on their years of service—full vesting in five years or 20% vesting per year starting by the end of the third year.

Vesting Schedule
Schedule setting forth when, and to what extent, options become exercisable or restricted stock or stock units are no longer subject to forfeiture (for example, 20% per year over five years).

Veterans Administration (VA) mortgage
A home mortgage loan granted by a lending institution to U.S. veterans and guaranteed by the Veterans Administration.

APFinancial a wide variety of investment
APFinancial Work places: Sector allocation
Investment of certain proportions of a portfolio in certain sectors. See: Industry allocation.

Sector diversification
Constituting of a portfolio of stocks of companies in each major industry group.

Sector fund
A mutual fund that concentrates on a relatively narrow market sector. These funds can experience higher share price volatility than some diversified funds because sector funds are subject to common market forces specific to a given sector.

Sector rotation
An active asset management strategy certain sectors, that tactically overweights and underweights depending on expected performance. Sometimes called rotation.

APFinancial Investment

Synthetic put
A strategy equivalent in risk to purchasing a put option where an investor sells stock short and buys a call.

Synthetic stock
An option strategy that is equivalent to the underlying stock. A long call and a short put is synthetic long stock. A long put and a short call is sythetic short stock.

Synthetics
Customized hybridinstruments created by blending an underlying price on a cash instrument with the price of a derivative instrument. It is a combination of security holdings that mimics the price movement of another single security (i.e., synthetic call: long position in a stock combined with a put on that position; a protected longsale; synthetic put:short position in a stock combined with a call on that position; a protectedshort sale).

APFinancial mutual funds

Right of accumulation
Allow investors to combine prior mutual fund purchases with current purchases in the same mutual fund or related mutual fund family to qualify for a breakpoint and obtain a lower sales charge.

Rights offering
Issuance to shareholders that allows them to purchase additional shares, usually at a discount to market price. Holdings of shareholders who do not exercise rights are usually diluted by the offering. Rights are often transferable, allowing the holder to sell them on the openmarket to others who may wish to exercise them. Rights offerings are particularly common to closed-end funds, which cannot otherwise issue additional common stock.

APFinancial Careers

Small-firm effect
The tendency of small firms (in terms of total market capitalization) to outperform the stock market (consisting of both large and small firms).

Small investor
An individual person investing in small quantities of stock or bonds. This group of investors makes up a minimal fraction of total stock ownership.

Small issues exemption
Securitiesissues that involve less than $1.5 million are not required to file a registration statement with the SEC. Instead, they are governed by Regulation A, for which only a brief offering statement is needed.

APFinancial investment companies

APFinancial Careers: Cash reserves
See: Cash investments

Cash sale/settlement
Transaction in which a contract is settled on the same day as the trade date, or the next day if the trade occurs after 2:30 p.m. EST and the parties agree to this procedure. Often occurs because a party is strapped for cash and cannot wait until the regular three-business daysettlement.
Cash Settlement
The process by which the terms of an option contract are fulfilled through the payment or receipt in dollars of the amount by which the option is in-the-money as opposed to delivering or receiving the underlying stock.

Cash settlement contracts
Futures contracts such as stock index futures that settle for cash and do not involve delivery of the underlying.

Cash-surrender value
The amount an insurance company will pay if the policyholdertenders or cashes in a whole life insurance policy.
APFinancial investment products
APFinancial Comprehensive Proposals
APFinancial

Variable-rate demand note
A note that is payable on demand and bears interest tied to a money market rate.

Variable-rate loan
Loan made at an interest rate that fluctuates depending on a base interest rate, such as the prime rate or LIBOR.

Variable rated demand bond (VRDB)
Floating-rate bond that periodically can be sold back to the issuer.

Variable Ratio Write
An option strategy in which the investor owns 100 shares of the underlying security and writes two call options against it, each option having a different striking price.

APFinancial Contact
APFinancial Work places: Replacement cost
Cost to replace a firm'sassets.

Replacement cost accounting
An accounting method that includes as part of depreciation the difference between the original purchase price of an asset and the current replacement cost.

Replacement cost insurance
Insurance that pays out the full amount required to replace damaged property with new property, without taking into account the depreciated value of the property.

APFinancial Insurance

Registered secondary offering
A reoffering of a large block of securities, previously publicly issued, by the holder of a large portion of some corporation through an investment firm.

Registered security
Used in the context of general equities. Securities whose owner's name is recorded on the books of the er or the issuer's agent, called a registrar.

Registered Shares
Shares that are issued in a shareholder's name as the holder of record.

Registered trader
A member of the exchange who executes frequent trades for his or her own account.

APFinancial growth rate

Self-tender offer
A company that tenders for its own shares.
Sell the book
Used for listed equity securities. Order to a broker by the holder of a large quantity of shares of a security to sell all that can be absorbed at the current bid price. The term derives from the specialist's book - the record of all the buy and sell orders members have placed in the stock one handles. In this scenario, the buyers potentially include those in the specialist's book, the specialist for its own account, and broker-dealers.

Sell hedge
Related: short hedge.

Sell limit order
Conditional trading order that indicates that a security may be sold at the designated price or higher. Related: Buy limit order.

Sell off
Sale of securities under pressure. See: Dumping.

APFinancial Investments

Justified price
The fair market price of an asset.

Kansas City Board of Trade (KCBT)
The U.S.-based futures and options exchange for no. 2 red wheat futures and, options, Value Line Index futures and Mini Value Line futures and options.

Kappa
The ratio of the dollar price change in the price of an option to a 1% change in the expected volatility.

APFinancial Net

APFinancial Seminars & Workshops: Confirmation
The written statement that follows any "trade" in the securities markets. Confirmation is issued immediately after a trade is executed. It spells out settlement date, terms, commission, etc.

Confirmed Letter of Credit
A letter of credit which a bank other than the bank that opened it agrees to honor as though they had themselves issued it. This additional confirmation is in addition to the obligation of the bank which issued the letter of credit.

Confirming Bank
The bank which has confirmed a letter of credit opened by another bank.
APFinancial Work places
APFinancial Personal
APFinancial Comprehensive Proposals

International Petroleum Exchange (IPE)
Energy futures and optionsexchange based in London.

International Security Market Association (ISMA)
Swiss law association located in Zurich that regroups all the participants on the Eurobondprimary and secondary markets. Establishes uniform trading procedures in the international bond markets.

International Stock Exchange of the U.K. and the Republic of Ireland (ISE)
Organization that replaced the London Stock Exchange after its merger with the International Securities Regulatory Organization (ISRO).

International Swap Dealers Association (ISDA)
Formed in 1985 to promote uniform practices in the writing, trading, and settlement of swaps and other derivatives.

APFinancial Work places
APFinancial traditional bank instruments: "Soft" capital rationing
Constraints on spending that under certain circumstances can be violated or even viewed as constituting targets rather than absolute limits.

Soft currency
The money of a country that is expected to drop in value relative to other currencies.

Soft dollars
The value of research services that brokerage houses supply to investment managers "free of charge" in exchange for the investment manager's business commissions.

Soft landing
A term describing a growth rate high enough to keep the economy out of recession, but also slow enough to prevent high inflation and interest rates.

APFinancial investment companies

Risk-averse
Describes an investor who, when faced with two investments with the same expected return but different risks, prefers the one with the lower risk.

Risk-based capital ratio
Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset.

Risk classes
Groups of projects that have approximately the same amount of risk.

Risk controlled arbitrage
A self-funding, self-hedged series of transactions that generally use mortgage securities (MBS) as the primary assets.

APFinancial investment products

Bylaw Amendment Limitations
These provisions limit shareholders' ability to amend the governing documents of the corporation. This might take the form of a supermajority vote requirement for charter or bylaw amendments, total elimination of the ability of shareholders to amend the bylaws, or the ability of directors beyond the provisions of state law to amend the bylaws without shareholder approval.

Bypass trust
An irrevocable trust that is designed to pay trust income (and principal, if needed) to an individual's spouse for the duration of the spouse's lifetime. The bypass trust is not part of the beneficiary spouse's estate and is not subject to federal estate taxes upon his/her death.

Cabinet crowd
NYSE members who tradebonds with a low daily traded volume. See: Automated Bond System.

APFinancial

Binder
An amount of money paid to indicategood faith in a transaction before the transaction is completed.

Binomial option pricing model
An option pricing model in which the underlying asset can assume one of only two possible, discrete values in the next time period for each value that it can take on in the preceding time period.

Bi-weekly mortgage loan
A mortgageloan on which interest and principal payments are made every half-month (total of 26 payments) as opposed to monthly payments. This results in earlier loan retirement.

APFinancial Job Offers

: Notes to the financial statements
A detailed set of notes immediately following the financial statements in an annual report that explain and expand on the information in the financial statements.

Notice day
A day on which notices of intent to deliver pertaining to a specified delivery month may be issued. Related: Delivery notice.

Notice of Meeting
The legal one-page notice to security holders stating the date, time and place of the shareholder meeting. This page is normally attached to the front of the proxy statement.

Notice Period
The time during which the buyer of a futures contract can be called upon to accept delivery. Typically, the 3 to 6 weeks preceding the expiration of the contract.

Notification date
The day the option is either exercised or expires.
APFinancial Contact
APFinancial Representatives
APFinancial Asociates

Tax-equivalent yield
The pre-tax yield required from a taxable bond in order to equal the tax-free yield of a municipal bond.

Tax evasion
Illegal by reducing tax burden by underreporting income, overstating deductions, or using illegal tax shelters.

Tax-exempt bond
A bond usually issued by municipal, county, or state governments whose interest payments are not subject to federal and, in some cases, state and local income tax.

Tax-exempt income
Dividends and interest not subject to federal and, in some cases, state and local income taxes.

APFinancial growth rate
APFinancial traditional bank instruments: Timing option
The seller's choice of when in the delivery month to deliver. A Treasury Bond or notefutures contract.

Tip
Information given by one trader to another, which is used in making buy or sell decisions but is not available to the general public.

Tired
Has been strong for a while and will probably fall due to increased supply at current price level (due to e.g. profit taking, technical analysis). Heavy.

APFinancial Investments

Revolving line of credit
A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years.

Reward-to-volatility ratio
Ratio of excess return to portfoliostandard deviation.

Rich
Term for a security whose price seems too high in light of its price history.

RICO
Stands for Racketeer Influenced and Corrupt Organization Act. Legislation under/which inside traders may be convicted.

Rider
A form accompanying an insurance policy that alters the policy's terms or coverage.

APFinancial Insurance

Swap arrangements
Short-term reciprocal lines of credit between the Federal Reserve and 14 foreign centeral banks as well as the Bank for International Settlements. Through a swap transactions, the Federal Reserve can, in effect, borrowforeign currency in order to purchase dollars in the foreign exchange market. In doing so, the demand for dollars and the dollar's foreign exchange value are increased. Similarly, the Federal Reserve can temporarily provide dollars to foreign central banks through swap arrangments.

Swap assignment
Related: Swap sale

Swap book
A swap bank's portfolio of swaps, usually arranged by currency and maturity.

APFinancial Careers

Collection policy
Procedures a firm follows in attempting to collectaccounts receivables.

Collection ratio
The ratio of a company'saccounts receivable to its average daily sales, which gives the average number of days it takes the company to convert receivables into cash.

Collective wisdom
The combination of all the individual opinions about a stock's or security's value.

Colombo Stock Exchange
Established in 1984, the only public stock exchange of Sri Lanka.

APFinancial a wide variety of investment

: Window contract
A guaranteed investment contract purchased with deposits over some future designated time period (the "window"), usually between 3 and 12 months. All deposits made are guaranteed the same credit rating. Related: Bullet contract.

Window dressing
Trading activity near the end of a quarter or fiscal year that is designed to improve the appearance of a portfolio to be presented to clients or shareholders. For example, a portfolio manager may sell losing positions so as to display only positions that have gained in value.

Winnipeg Commodity Exchange
Canada's only agricultural futures and optionsexchange, located in Manitoba.
APFinancial Interests
APFinancial Seminars & Workshops
APFinancial Net

Compound growth rate
See: Compound Annual Growth Rate

Compound interest
Interest paid on previously earned interest as well as on the principal.

Compound option
Option on an option.

Compounding
The process of accumulating the time value of money forward in time. For example, interest earned in one period earns additional interest during each subsequent time period.

Compounding frequency
The number of compounding periods in a year. For example, quarterly compounding has a compounding frequency of 4.

APFinancial Investment
APFinancial traditional bank instruments: Securities and Exchange Commission Rules
Rules enacted by the SEC to assist in the regulation of US financialmarkets.

Securities Exchange Act of 1934
Legislation that created the SEC, outlawing dishonest practices in the trading of securities.

Securities Exchange of Thailand (SET)
The only stock market in Thailand, based in Bangkok.

Securities Industry Association (SIA)
An association of broker-dealers who sell taxable securities, which lobbies the government, records industrytrends, and keeps records of brokerprofits.

APFinancial mutual funds

Market value ratios
Ratios that relate the market price of the firm'scommon stock to selected financial statement items.

Market value-weighted index
An index of a group of securities computed by calculating a weighted average of the returns on each security in the index, where the weights are proportional to outstandingmarket value.

Marketability
A negotiablesecurity is said to have good marketability if there is an activesecondary market in which it can easily be resold.

Marketable securities
Securities that are easily convertible to cash because there is high demand allowing them to be sold quickly.

Marketable title
A clear, reasonably incontestable title to a piece of real estate that is good for transaction purposes.

APFinancial traditional bank instruments

In addition to the Fort Collins and Denver office, AP Financial has offices in Miami, Orlando, Phoenix, San Antonio, Tampa, and Dallas. Expansions is a good thing and there are plans to expand in other areas where there is need of help.

Associates of AP Financial are also registered representatives with and offer securities and services through InterSecurities, Inc. (ISI), member FINRA, SIPC. ISI, an AEGON company, is a national full service Broker/Dealer offering investment, retirement and insurance products and services which allows their representatives to offer financial products to suit each individual client’s needs and will.

APFinancial Personal

Contract month
The month in which futures contracts may be satisfied by making or accepting a delivery.

Contractual Claim
An amount that by legal agreement must be paid periodically to the buyer of a security; contractual claim may also specify the time at which the principal must be repaid and other details.

APFinancial mutual funds

: Stale price arbitrage
For a number of assets, the most recent transaction price at 4PM ET does not fully reflect all available market information. One example is international equities that trade on exchanges that are located in different time zones and close 2-15 hours before U.S. markets. In addition, domestic small-capitization equities and high-yield and convertible bonds often trade infrequently and have wide bid-ask spreads. This can cause the most recent transaction price to be much different from the price that one would see in a liquid market at 4 PM, even for assets that trade on exchanges that are open at that time. Investors can take advantage of mutual funds that calculate their NAVs using stale closing prices by trading based on recent market movements. For example, if the U.S. market has risen since the close of overseas equity markets, investors can expect that overseas markets will open higher the following morning. Investors can buy a fund with a stale-price NAV for less than its current value, and they can likewise sell a fund for more than its current value on a day that the U.S. market has fallen. Similar opportunities exist when the values of infrequently or illiquidly-traded domestic assets have recently changed. Also referred to as Net Asset Value Arbitrage or NAV Arbitrage.

Stalking horse
In bankruptcy proceedings, this refers to the company that first bids for the companies assets.
APFinancial Careers
APFinancial Net
APFinancial a wide variety of investment

Road show
A promotional presentation by an issuer of securities to potential buyers about the desirable qualities of the investments.

Rotation
An active asset management strategy that tactically overweighted and underweighted certain sectors, depending on expected performance. Sometimes called sector rotation.

Rocket scientist
An employee of an investment firm (often having a Ph.D. in physics or mathematics) that works on highly mathmatic models of derivative pricing.

Roll down
To move to an optionposition with a lower exercise price.

APFinancial Asociates
APFinancial Investments: Remit
To pay for purchases by cash, check, or electronic transfer.

Remote disbursement
Technique that involves writing checks drawn on banks in remote locations so as to maximize disbursement float.

Renegotiable rate
A type of variable rate involving a renewable short-term "balloon" note. The interest rate on the loan is generally fixed during the term of the note, but when the balloon comes due, the lender may refinance it at a higher rate. In order for the loan to be fully amortized, periodic refinancing may be necessary.

Renewal
Placement of a day order identical to one not completed on the previous day.

APFinancial Representatives

Parallel shift in the yield curve
A shift in economic conditions in which the change in the interest rate on all maturities is the same number of basis points. In other words, if the three month T-bill increases 100 basis points (one %), then the 6-month, 1-year, 5-year, 10-year, 20-year, and 30-year rates all increase by 100 basis points as well. Related: Non-parallel shift in the yield curve.

Parameter
A model is a combination of variables, such as GDP growth, and coefficients which multiply these variables. The coefficients are often estimated from the data. The coefficients are called parameters.

Parent company
A company that controlssubsidiaries through its ownership of voting stock, as well as runs its own business.

Paris Bourse
National stock market of France.

APFinancial

Skort-Swing Transaction
Any purchase and sale, or sale and purchase, of the issuer's equitysecurities by an insider within a period of less than six months, See: Section 16(b) above.

SLD last sale
Shortened version of "sold last sale," which shows up on the consolidated tape when a large change (one point for lower priced securities and two points for higher-priced securities) occurs between transactions.

Sleeper
Stock in which there is little investor interest but that has significant potential to gain in price once its attractions are recognized. Antithesis of high flyer.

APFinancial Seminars & Workshops

Projection
The use of econometric models to forecast the future performance of a company, country, or other financial entity using historical and current information.

Promissory note
Written pledge to pay.

Property inventory
A list of personal property with corresponding values and initial costs often used to substantiate insurance claim and tax losses.

Property rights
Rights of individuals and companies to own and use property as they see fit and to receive the stream of income that their property generates.

Property tax
A tax levied on real property based on its use and its assessed value.

APFinancial Personal

: Marital trust
A trust created to allow one spouse to transfer, during life or upon death, an unlimited amount of property to his/her spouse without incurring gift or estate tax.

Markdown
The amount subtracted from the selling price of securities when they are sold to a dealer in the OTC market. Also, the discounted price of municipal bonds after the market has shown little interest in the issue at the original price.

Marked-to-market
An arrangement whereby the profits or losses on a futures contract are settled each day.

Market
Usually refers to the equity market. "The market went down today" means that the value of the stock marketdropped that day.

Market analysis
An analysis of technical corporate and market data used to predict movements in the market.

Market-based forecasting
Analyzing future spot rates on the basis of a market-determined exchange rate (such as the current spot rate or forward rate).

Market-based corporate governance system
Organization of a corporation whereby the supervisory board represents a dispersed set of largely equityshareholders.
APFinancial Investment
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APFinancial Interests

Chicago Mercantile Exchange (CME)
Chicago Mercantile Exchange (CME) is the largest futures exchange in the United States and the second largest exchange in the world for the trading of futures and options on futures. Founded in 1898 as a not-for-profitcorporation, in November 2000 CME became the first U.S. financial exchange to demutualize and become a shareholder-owned corporation. Its futures and options on futurestrade on CME's trading floors, on its GLOBEX electronic trading platform and through privately negotiated transactions. CME has four major product areas based on interest rates (including Eurodollar futures, the world's most actively traded futures contract), stock indexes (such as the (S&P 500 and Nasdaq-100 futures), foreign exchange and commodities.

Chicago Stock Exchange (CHX)
A major exchangetrading only stocks, with 90% of trades taking place on an automated execution system, called MAX.



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