|
A | B | C | D | E | F | G | H| I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | XYZ | Back to main
 Cage - Area in a brokerage office where cashiering activity takes place.
Call - (1) Action where a company redeems a security prior to its maturity date; or (2) a contract to purchase a specific security at a specified price by a certain date. (See "Options")
Call Feature - Feature allowing the issuer to "call" or repurchase certain securities, typically corporate and municipal bonds, at a specified price and/or point in time. For example, XYZ Corp. 6% bonds have a call feature on March 1, 1999, at 105.
Call Price - Price at which a "callable" security may be repurchased.
Callable - Security containing a call feature.
Called Away - Security called by the issuer from a client's account.
Cancel - Order revoking a previous order to execute a security transaction.
Capital - Accumulated money or goods used to produce income.
Capital Gain - Gain or profit from the sale of assets or securities.
Capital Loss - Loss on capital invested. Individuals who incur a loss from the sale of a security are credited with a capital loss that may be used to offset capital gains for purposes of calculating income taxes.
Capital Stock - All shares, common and preferred, authorized and issued by a company.
Capital Surplus - Amount a security's original purchase price exceeds its par value.
Capitalization - Total value of a company’s capital investment, including the amount raised from sale of common stock, preferred stock, bonds and retained earnings. Also refers to a company’s "market capitalization," or shares outstanding multiplied by the current share price.
Carry Forward - Asset created from the value of tax losses incurred in previous years and available to be used in future periods to offset taxable income. A corporation with a $1 million tax-loss carry forward may save as much as $340,000 in corporate income taxes by using the loss in future periods.
Cash Basis Accounting - Accounting method where all transactions are posted for the amount of cash exchanged instead of accruing income and expenses. (See "Accrual Accounting")
Cash Conversion Cycle - Length of time required for a business to convert raw materials into finished goods, finished goods into sales, and accounts receivable into cash. These factors vary according to the type of industry and scale of production, which varies in turn with seasonality and the rise and fall of sales. The cash conversion cycle is funded by working capital. (See "Working Capital")
Cash Flow - Measurement of cash a company gained or lost during an accounting period and adjusted for any previous accounting for accruals and other non-cash transactions. Calculated as follows: earnings after interest and taxes, less preferred dividend if applicable, with depreciation added back. It is possible for a company to report an operating profit while incurring a loss of cash for the same period as well as reporting an operating loss while incurring an increase in cash flow.
Certificate - Document issued by a corporation in evidence of ownership or "title" to a security.
Chicago Board Options Exchange (CBOE) - First and largest organized marketplace for trading specific put and call options.
Chicago Board of Trade (CBOT) - Largest exchange for trading of futures contracts, best known for grains and metals futures; parent organization of CBOE.
Chicago Mercantile Exchange - Second largest commodities exchange; best known for futures in agricultural commodities.
Churning - Illegal or unethical practice by a broker or other fiduciary to cause excessive transactions in a client’s account to benefit the broker or fiduciary through increased transaction fees.
Clearing Firm - Brokerage firm with the fiduciary responsibility to transfer and receive all securities held or transacted on its own or by corresponding firms. Often, many small and mid-sized brokerages and financial services companies use a clearing firm which acts as the fiduciary for a client’s account holdings and transfers while the brokerage firm principally acts as the sales and/or advisory agent.
Close - Time when a marketplace ceases its regular trading activities. The New York Stock Exchange, NASDAQ and other major U.S. stock exchanges close regular trading session at 4:00 pm Eastern time.
Closed-End Fund - Mutual fund that does not accept new investments or withdrawals after its initial formation; essentially acts as a holding corporation for the purpose of investing in other public corporations. The typical closed-end fund trades on a major U.S. stock exchange and is bought and sold in the secondary market in the manner of corporate shares.
Closely Held - Term used to describe when most of the shares of a company’s stock are held by a relatively small group of investors.
Closing Quote - Last price quoted for a security at the close of the market.
Commercial Paper - Short-term corporate debt actively traded by institutions. Many mutual funds and money market funds invest in these notes, which may mature in as little as one day, to achieve interest on short-term, liquid investments and cash equivalents.
Commingling - Illegal act of combining securities or other assets of a client’s account with those of the brokerage or fiduciary in order to boost the fiduciary's financial status.
Committee on Uniform Securities Identification Procedures (CUSIP) - Group that assigns identification numbers and codes to all securities, to be used when recording all buy and sell orders.
Commodity - Any bulk good traded on an commodity exchange or in the cash, or spot market is referred to as a commodity. Examples of a commodity include metals, grains and meats.
Common Stock - Regular shares of ownership issued by corporations.
Common Stock Equity - Total assets minus total liabilities divided by a corporation's common shares outstanding. Essentially the same as shareholder’s equity except in cases where a significant amount of preferred shares is outstanding.
Common Stock Equivalent - Securities which may be convertible into common stock in the future, including warrants, stock options and convertible debentures. Counted as common stock when determining a corporation’s value per share on a fully-diluted basis.
Compliance - Refers to the department in a brokerage firm where a watchful eye is supposed to be maintained on all activities regulated by government and self-regulatory organizations. Also, companies that keep up with required SEC filings are said to be "in compliance."
Consumer Price Index (CPI) - U.S. government index of prices for a variety of consumer goods and a widely followed inflation measure for inflation. Example: The CPI, adjusted to 100 in 1983, stood at approximately 162 in March 1998, a 62% increase.
Control Person - Any person employed by a company and in position to control the company’s actions, such as a CEO, Chairman of the Board or a large shareholder.
Convertible - Any security which may be converted into units of another security. Often associated with preferred shares and some debentures, conversion usually is specified in common shares. (See "Fully Diluted")
Cooling-off Period - 20-day period after a company files its prospectus with the SEC, but before its initial public offering. During this period, the company's relations with investors are greatly restricted.
Corporate Bond - Any debt or debenture issued by a corporation.
Corporation - Form of business organization characterized by a state charter or articles of incorporation enabling certain rights separate from its owners. Common features of a corporation include limited liability of the owners, issuance of stock in evidence of ownership, election of directors and officers by vote of shareholders and taxation of the corporation separate to that of the owners.
Coupon - Amount of interest paid periodically by the issuer of a bond or other interest-bearing security.
Coupon Bond - Bond bearing a coupon or paying a periodic distribution of interest. Most bonds are considered coupon bonds.
Cover - Act of purchasing stocks, futures contracts or Forex positions to offset a short position or shorting stocks, futures or Forex position to offset a long position. (See "Covered Option")
Covered Option - Option contract backed by the shares underlying the option. This strategy is commonly used by individuals, mutual funds and other investors to increase the current yield of stocks held and to take advantage of or hedge against unfavorable price declines of the underlying shares. A relatively conservative investment strategy, covered writers risk only giving up future potential profits without taking additional monetary risks.
Crossed Market - Orders for buying and selling stocks are imbalanced to the extent that the highest bid is greater than the lowest offer; shares will not trade until market makers or exchange specialists adjust bids and asks accordingly.
Cumulative Preferred Stock - Preferred shares whose dividends accumulate during periods when they are not paid or distributed to shareholders.
Current Market Value - Current price of an asset or security if it were to be sold; often used to describe the value of a portfolio of securities held in a customer's account. Assets on the balance sheet are reported at book value or at their original acquisition cost, less any depreciation or write-down. However, some assets, such as real estate, may appreciate in fair market potential and not reflect the current market value if sold.
Current Assets - Assets which normally are converted into cash in 12 months or less, including accounts receivable and liquid investments such as stocks and bonds.
Current Liabilities - Liabilities or debts which come due in 12 months or less, typically including short-term borrowings and the portion of long-term borrowings due in the next 12 months as well as accounts payable and rent due.
Current Ratio - Current assets divided by current liabilities. Fundamental analysis looks at this ratio to determine if a company may have problems meeting its short-term obligations. If the current liabilities exceed current assets, the ratio is less than 1.0 and generally seen as a measure of short-term financial weakness. Conversely, a ratio greater then 1.0 is seen as a measure of short-term financial strength.
Current Yield - Current rate of interest or yield, if a bond or other fixed-income security were purchased at current market prices; calculated by taking the coupon rate and dividing by the security price. Example: XYZ Corp. bonds pay a coupon rate of 8.75% and may be purchased at the current market price of 105, for a current yield of 8.3% (8.75/105=8.3).
Custodian - Person or institution acting under authority to direct the investment activities of another party’s account; often done in connection with accounts held for the benefit of minors or persons unable to manage their own investments. | 
