APFinancial Investments

Selling, general, and administrative (SG&A) expenses
Expenses such as salespersons' salaries and commissions, advertising and promotion, travel and entertainment, office payroll and expenses, and executives' salaries.

Selling on the good news
A strategy of selling stock shortly after a company announces good news and the stock price rises. Investors believe that the price is as high as it can go and is on the brink of going down.

Selling group
All banks involved in selling or marketing a new issue of stock or bonds.

APFinancial Comprehensive Proposals

Loss-of-income insurance
Insurance coverage that will pay out income that a policyholderloses as a result of a disability, injury, or business disruption.

Loss payee
A party to whom an insurance loss payment or insurance settlement may be directly paid.

Loss ratio
The ratio of losses paid or accrued by an issurer to premiums collected over a year.

Lots
In the context of general equities, this blocks or portions of trades. Can express a specific transaction in a stock at a certain time, often implying execution at the same price (e.g., "I traded 40m in two lots of 10 and four lots of 5.").

APFinancial growth rate

APFinancial Insurance: Overall market price coverage
Total assets less intangibles divided by the total of the market value of the securityissue and the book value of liabilities and issues having a prior claim. This is used to determine how much of the market value of a certain class of securities would be covered in liquidation.

Overbought
Used in the context of general equities. Technically too high in price, and hence a technical correction is expected. See: Heavy. Antithesis of oversold.

Overbought-oversold indicator
An indicator that attempts to define when prices have moved too far and too fast in either direction and thus are vulnerable to reaction.

Overcapitalization
Said to occur when a firm cannot service its debt even though its debt/equity ratio is not excessive.

Overdraft
Provision of instant credit by a lending institution.
APFinancial Contact
APFinancial Careers
APFinancial Investment

Money purchase plan
A defined benefit contribution plan in which the participant contributes some part and the firm contributes at the same or a different rate. Also called an individual account plan.

Money order
A financialinstrument backed by a deposit at a certain firm such as a bank that can be easily converted into cash.

Money rate of return
Annualmoneyreturn as a percentage of asset value.

Money supply
M1-A: Currency plus demand deposits.
M1-B: M1-A plus other checkable deposits.
M2: M1-B plus overnight repos, money market funds, savings, and small (less than $100M) time deposits.
M3: M-2 plus large time deposits and term repos.
L: M-3 plus other liquid assets.

APFinancial Seminars & Workshops
APFinancial Net: Material Adverse Change or Effect
Many mergers and acquisitions contracts include a material adverse change clause that allows a company to renegotiate or walk away from a deal if the other company or its subsidiaries announces a significant event that may negatively affect its stock price or operations. See also materiality.

Materiality
The importance of an event or information in influencing a company'sstock price. Companies must report any material events within one month by filing SEC form 8-K.

Materials requirement planning
Computer-based systems that plan backward from the production schedule to make purchases in order to manage inventory levels.

APFinancial Representatives

Core capital
The capital required of a thrift institution, which must be at least 2% of assets to meet the rules of the Federal Home Loan Bank.

Core competence
Primary area of expertise. Narrowly defined fields or tasks at which a company or business excels. Primary areas of specialty.

Cornering the market
Purchasing a security or commodity in such volume as to achieve control over its price. An illegal practice.

C Corporation
A corporation that elects to be taxed as a corporation. The C corporation pays federal and state income taxes on earnings. When the earnings are distributed to the shareholders as dividends, this income is subject to another round of taxation (shareholder's income). Essentially, the C corporations' earnings are taxed twice. In contrast, the S corporation's earnings are taxed only once.

Corporate acquisition
The acquisition of one firm by another firm.

APFinancial traditional bank instruments

Monetize the debt
Financing the national debt by printing new money, which causes inflation due to a larger money supply.

Money
Currency and coin that are guaranteed as legal tender by the government, a regulatory agency or bank.

Money base
Composed of currency and coins outside the banking system plus liabilities to the deposit money banks.

Money center banks
Banks that raise most of their funds from the domestic and international money markets , relying less on depositors for funds.

APFinancial Asociates

Span
To cover all contingencies within a specified range.

SPDRs
SPDRs (Spiders) are designed to track the value of the Standard & Poor's 500 Composite Price Index. Stands for Standard & Poor's Depositary Receipt. They trade on the American Stock Exchange under the symbol SPY. SPDRs are similar to closed-end funds but are formally known as, a unit investment trust. One SPDR unit is valued at approximately one-tenth (1/10) of the value of the S&P 500. Dividends are disbursed quarterly, and are based on the accumulatedstock dividends held in trust, less any expenses of the trust. See: Mid-cap SPDR.

Special arbitrage account
A margin account with lower cash requirements, reserved for transactions that are hedged by an offsettingposition in futures or options.

APFinancial Work places

APFinancial Asociates: Carrying costs
Costs that increase with increases in the level of investment in current assets.

Carrying value
Book value.

Cartel
A group of businesses or nations that act together as a single producer to obtain marketcontrol and to influence prices in their favor by limiting production of a product. The United States has laws prohibiting cartels.
APFinancial Job Offers
APFinancial mutual funds
APFinancial Interests

Seasoned
In the case of equity, having gained a reputation for quality with the investingpublic and enjoying liquidity in the secondary market; in the case of convertibles, having traded for at least 90 days after issue in Europe, and thus available for sale legally to U.S. investors.

Seasoned datings
Extended credit for customers who order goods in periods other than peak seasons.

Seasoned issue
Issue of a security for which there is an existing market. Related: Unseasoned issue.

APFinancial
APFinancial Net: Weak dollar
A depreciated dollar with respect to other currencies, meaning that more dollars are needed to buy a unit of foreign currency. Antithesis of strong dollar.

Weak-form efficiency
A pricing theory that the price of a security reflects the past price and trading history of the security. Theory implies that security prices follow a random walk. Related: Semistrong-form efficiency, strong-form efficiency.

Weak market
A market with few buyers and many sellers and a declining trend in prices.

APFinancial Personal

Underlying asset
The security or property or loan agreement that an option gives the option holder the right to buy or to sell.

Underlying debt
Municipal bonds issued by government entities but under the control of larger government entities and for which the larger entity shares the credit responsibility.

Underlying futures contract
A futures contract that supports an option on that future, which is executed if the option is exercised .

APFinancial a wide variety of investment

Bollinger Bands Plus or minus two standard deviations where the standard deviations are calculated historically in a moving window estimation. Hence, the bands will widen if the most recent data is more volatile. If the prices break out of the band, this is considered a significant move.

Bolsa
Spanish for stock exchange.

Bolsa de Commercio de Santiago (SSE)
Chile's preeminent stock exchange.

Bolsa de Valores de Rio de Janeiro (BVRJ)
Brazil's second-largest stock exchange.

Bolsa de Valores de Sao Paulo (BOVESPA)
The largest stock exchange in Brazil.

APFinancial Insurance

Transfer
A change of ownership from one person or party to another.

Transfer agent
Individual or institution a company appoints to look after the transfer of securities.

Transfer On Death (TOD)
The process of changing title of a security from one name to another upon the death of one of the titleholders.

APFinancial investment companies

APFinancial Comprehensive Proposals: Reorg (or Corporate Action or Reorganization)
Any transaction involving the issuance of stock or cash, or the cancellation of stock tendered by a shareholder, such as in the case of a merger, acquisition or tender offer.

Reorganization
Creation of a plan to restructure a debtor's business and restore its financial health.

Reorganization bond
A bondissued by a company undergoing a reorganization process.

Repatriation
The return from abroad of the financialassets of an organization or individual.

Replacement Chain
A concept that views a capital investment as an indefinite commitment to a specific type of technology. The replacement chain concept can be used to allow the comparison of mutually exclusive investments with unequal lives.
APFinancial Net
APFinancial investment products
APFinancial Net

Suitability rules
Policies and guidelines that brokers must use to ensure that investors have the financial means to assume risks that they wish to undertake. These are enforced by the NASD and other self-regulatory organizations.

Suitable
Describing a strategy or trading philosophy in which the investor is operating in accordance with his(her) financial means and investment objectives.

Summary plan description (SPD)
A document that explains the fundamental features of an employer's defined benefit or defined contribution plan, including eligibility requirements, contribution formulas, vesting schedules, benefit calculations, and distribution options. ERISA requires that the SPD be easy to understand and that each participant receive a copy within 90 days of joining the plan.

APFinancial Investment
APFinancial Investments: MBS servicing
The requirement that the mortgage servicer maintain payment of the full amount of contractually due principal and interest payments whether or not actually collected.

Meals and entertainment expense
A tax deduction allowed for meals and entertainment expenses incurred in the course of business.

Mean
The expected value of a random variable. Arithmetic average of a sample.

APFinancial Interests

Payable through drafts
A method of making payment that is used to maintain control over payments made on behalf of the firm by personnel in noncentral locations. The payer's bank delivers the payable through draft to the payer, which must approve it and return it to the bank before payment can be received.

Payable date
The date when dividends or capital gains are paid to shareholders or reinvested in additional shares.

Payables
Related: Accounts payable

Payback
The length of time it takes to recover the initial cost of a project, without regard to the time value of money.

APFinancial

Whoops
A nickname for the Washington Public Power Supply System, which in the 1970s raised billions of dollars through municipal bondofferings, the projects that never materialized. WPPSS defaulted on the payments to bondholders.

APFinancial Careers

Offshore finance subsidiary
A wholly owned affiliate incorporated overseas, usually in a tax haven country, whose function is to issuesecurities abroad for use in either the parent's domestic or foreign business.

Offshore fund
A mutual fund whose headquarters is based outside the United States.

"O.K. to cross"
Used for listed equity securities. "Legal to cross the buy and sell orders on the exchange floor because transactor is not a principal in the transaction."

Old-line factoring
Factoring arrangement that provides collection, insurance, and finance for accounts receivable.

Oligopoly
A Market characterized by a small number of producers who often act together to control the supply of a particular good and its market price.

Oligopsony
A Market characterized by a small number of large buyers who control all purchases and therefore the market price of a good or service.

APFinancial Asociates

: Monitor
To seek information about an agent's behavior; a device that provides such information.

Monopoly
Absolute control of all sales and distribution in a market by one firm, due to some barrier to entry of other firms, allowing the firm to sell at a higher price than the socially optimal price.

Monopsony
The existence of only one buyer in a market, forcing sellers to accept a lower price than the socially optimal price.

Monte Carlo simulation
An analytical technique for solving a problem by performing a large number of trail runs, called simulations, and inferring a solution from the collective results of the trial runs. Method for calculating the probability distribution of possible outcomes.
APFinancial Seminars & Workshops
APFinancial Work places
APFinancial Insurance

Check clearing
The movement of a check from the depository institution at which it was deposited back to the institution on which it was written; the movement of funds in the opposite direction and the corresponding credit and debit to the involved accounts. The Federal Reserve operates a nationwide check-clearing system.

Checking the market
Searching for bid and offer prices from market makers to find the best deal.

Chicago Board Options Exchange (CBOE)
A securities exchange created in the early 1970s for the public trading of standardized optioncontracts. Primary place for the trading of stockoptions,foreign currency options, and index options (S&P 100, 500, and OTC 250 index)

Chicago Board of Trade (CBOT)
The second largest futures exchange in the US, and a pioneer in the development of financial futures and options.

APFinancial Comprehensive Proposals
APFinancial Investments: Charge off
See: Bad debt

Charitable remainder trust
An irrevocable trust that pays income to a designated person or persons until the grantor's death, when the income is passed on to a designated charity. A charitable lead trust by contrast allows the charity to receive income during the grantor's life, and the remaining income to pass to designated family members upon the grantor's death.

Charter
See: Articles of incorporation

Charter 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.

APFinancial investment products

Right of first refusal
The right of a person or company to purchase some thing before the offering is made to others.

Right of redemption
The right to recover property that has been attached by paying off the debt .

Right of rescission
The right to void a contract without any penalty within three days as provided in the Consumer Credit Protection Act of 1968.

APFinancial a wide variety of investment

Coface
The French Export Credit Agency.

Coffee, Sugar & Cocoa Exchange (CS&CE)
The New York-based commodity exchange trading futures and options. The CS&CE shares the trading floor at the Commodities Exchange Center.

Cofinancing agreements
Joint participation of the World Bank and other agencies or lenders in providing funds to developing countries.

Coherent Market Hypothesis
A hypothesis that the probability density function of the market may be determined by a combination of group sentiment and fundamental bias. Depending on combinations of these two factors, the market can be in one of four states: random walk, unstable transition, chaos, or coherence.

APFinancial Personal

Amman Financial Market (AFM)
Established in 1976, the AFM is the only stock exchange in Jordan.

Amman Stock Exchange
The only agency authorized as a formal market for tradingsecurities in Jordan.

Amortization
The repayment of a loan by installments.

APFinancial investment companies

: Production Cost Advantage
A source of competitive advantage that depends on producing some product or service at the lowest cost.

Production-flow commitment
An agreement by the loanpurchaser to allow a monthly loan quota to be delivered in batches.

Production Loan
A project financing where the repayment is linked to the production, often on a dollar/unit basis.
APFinancial Representatives
APFinancial Job Offers
APFinancial Contact

Limited liability
Limitation of loss to what has already been invested.

Limited-liability instrument
A security, such as a call option, in which the owner can lose only the initial investment.

Limited partner
A partner who has limited legal liability for the obligations of the partnership.

Limited partnership
A partnership that includes one or more partners who have limited liability.

Limited payment policy
Life insurance providing full life protection but requiring premiums for only part of the customer's lifetime.

Limited recourse
A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse.

Limited risk
The risk inherent in optionscontracts, which is much lower than that of a futures contract, which has unlimited risk. The maximum loss in buying a call option, for example, is the premium paid for the option.

Limited price order
Used in the context of general equities. See: Limit order.

APFinancial traditional bank instruments
APFinancial Investments: Commodity paper
A loan or advance secured by commodities.ommodity Research Bureau
Produces a popular price index of 17 commodities which is often used to track inflationarytrends in the economy.

Commodity Trading Advisor
An investment manager that focuses on long and short trading in the futures markets. The trades are often intraday trades. Sometimes referred to as Managed Futures.

Common-base-year analysis
The representing of accounting information over multiple years as percentages of amounts in an initial year.

Common code
A nine-digit identification code issued jointly by CEDEL and Euroclear. As of January 1991 common codes replaced the earlier separate CEDEL and Euroclear codes.

APFinancial growth rate

Not held order (NH order)
Applies mainly to international equities. Market or limit order in which the customer does not desire to transact automatically at the inside market (market held) but instead has given the trader or floor broker (listed stock) time and price discretion in transacting on a best-efforts basis. This will not hold the broker responsible for missing the price within the limits (limit not held) or obtaining a worse price (market not held). The order is marked "not held, disregard tape/DRT, take time" or bears any such qualifying notation, excluding "or better." See: Held order.

Note
Debt instruments with initial maturities longer than one year and shorter than 10 years.

Note agreement
A contract for privately placeddebt.

Note issuance facility (NIF)
An agreement by which a syndicate of banks indicates a willingness to accept short-termnotes from borrowers and resell these notes in the Eurocurrency markets.

APFinancial Investments

International Chamber of Commerce (ICC)
A business organization with membership from over 80 countries. They work to harmonize trade practices worldwide by establishing agreed upon rules such as Incoterms and Uniform Customs and Procedures for Documentary Credits.

International Depository Receipt (IDR)
A receipt issued by a bank as evidence of ownership of one or more shares of the underlyingstock of a foreign corporation that the bank holds in trust. The advantage of the IDR structure is that the corporation does not have to comply with all the issuing requirements of the foreign country where the stock is to be traded. The US version of the IDR is the American Depository Receipt (ADR).

International Development Association (IDA)
Association established to stimulate country development; it was especially suited for less prosperous nations, since it provided loans at low interest rates.

International diversification
The attempt to reduce risk by investing in more than one nation. By diversifying across nations whose economic cycles are not perfectly correlated, investors can typically reduce the variability of their returns.

International Finance Corporation (IFC)
A corporation owned by the World Bank that produces a number of well-known stock indexes for emerging markets. Its major role is to provide financing for projects in less developed countries.

APFinancial mutual funds

Unconfirmed Letter of Credit
A letter of credit which has not been guaranteed or confirmed by any bank other than the bank that opened it. The advising bank merely informs the beneficiary of the letter of credit terms and conditions.

Uncovered call
A shortcall optionposition in which the writer does not own shares of underlyingstock represented by the option contracts. Uncovered calls are much riskier for the writer than a covered call, where the writer of the uncovered call owns the underlying stock. If the buyer of a callexercises the option to call, the writer would be forced to buy the asset at the current market price. Also called a "naked" asset.

APFinancial investment companies

: Transition phase
A stage of development when a company begins to mature and its earnings decelerate to the rate of growth of the economy as a whole. Related: Three-phase DDM.

Translation exposure
Risk of adverse effects on a firm'sfinancial statements that may arise from changes in exchange rates. Related: Transaction exposure.

Translation Risk
The risk of changes in the reported home currency accounting results of foreign operations due to changes in currency exchange rates.

Transmittal letter
A letter describing the contents and purpose of a transaction delivered with a security that is changing ownership.
APFinancial Personal
APFinancial Insurance
APFinancial growth rate

Mailing Date
A specific date set for the mailing of certain material to security holders such as interim reports, proxy material and dividendchecks.

Maintenance
Appropriate ongoing adjustments to security holder records.

Maintenance call
A call for additional money or securities when a margin account falls below its exchange-mandated required level.

Maintenance fee
A yearly charge to maintain brokerage accounts, such as asset management accounts or IRAs.

Maintenance margin
The dollar amount required to be kept at the OCC throughout the life of an option contract; percentage of the dollar amount of securities that must always be kept as margin.

APFinancial Representatives
APFinancial: 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.

APFinancial traditional bank instruments

Qualified Terminable Interest Property Trust (Q-TIP)
A trust that allows a surviving spouse to receive income generated from the trust, while the actual distribution of the trust's assets is made to other beneficiaries such as the grantor's children.

Qualified total distribution
A payment representing an employee's interest in a qualified retirement plan. The payment must be prompted by retirement (or other separation from service), death, disability, or attainment of age 59-1/2. Payment can be in installments as long as the complete distribution is made within a single tax year.

Qualifying annuity
An annuity allowable as investment for a qualified plan or trust.

Qualifying share
Shares of common stock that a person must hold in order to qualify as a director of the issuingcorporation.

APFinancial Careers

Operating in the red
Doing business while losing money.

Operating risk
The inherent or fundamental risk of a firm, without regard to financial risk. The risk that is created by operating leverage. Also called business risk.

Operationally efficient market
Market in which investors can obtain transactions services that reflect the true costs associated with furnishing those services. Also called an efficient market.

Operations department
See: Back office.

Opex
See: Operating Expenses

Opinion shopping
Attempts by a corporation to attain reporting objectives by following questionable accounting principles, with the help of an auditor willing to sanction the practices. Prohibited by the SEC.

APFinancial Seminars & Workshops

Bad title
Title to property that does not distinctly confer ownership, usually in the context of real estate.

Bai-kai
Two-sided marketpicture, in Japanese terminology applies mainly to international equities.

Bailing out
In the context of securities, refers to selling a security or commodity quickly, regardless of the price. May occur when an investor no longer wants to sustain further losses on a stock.

Also refers to relieving an individual, corporation, or government entity in financial trouble.

Bailout bond
A bondissued by the Resolution Funding Corporation (Refcorp) to save the failing savings and loan associations in the late 1980s and early 1990s.

APFinancial investment products

: Multiples
Another name for price/earnings ratios.

Multiplier
The investment multiplier which quantifies the overall effects of investment spending on total income. The deposit multiplier which shows the effects of a change in bank deposits on the total amount of outstandingcredit and the money supply.

Multirule system
A technicaltradingstrategy that combines mechanical rules, such as the CRISMA (cumulative volume, relative strength, moving average) Trading System of Pruitt and White.

Municipal bond
State or local governments offer muni bonds or municipals, as they are called, to pay for special projects such as highways or sewers. The interest that investors receive is exempt from some income taxes.
APFinancial Interests
APFinancial Contact
APFinancial Asociates

Rule lOb-5
An SEC rule that prohibits trading by insiders on material nonpublic information. This is also the rule under which a company may be sued for false or misleading disclosure.

Rule 13-d
Often used in risk arbitrage. Requirement under Section 13-d of the Securities Act of 1934 that a form must be filed with the SEC within ten business days of acquiring direct or beneficial ownership of 5% or more of any class of equitysecurities in a publicly heldcorporation. The purchaser of such stock must also file a 13-d with the stock exchange on which the shares are listed (if any) and the company itself. Required information includes the way the shares were acquired, the purchaser's background, and future plans regarding the target company. The law is designed to protect against insidious takeover attempts and to keep the investing public aware of information that could affect the price of their stock. See: Williams Act.



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