Sabanes Oxley Act: This is an Act passed in the USA to ensure that corporations meet pres ...

Sacred Cow: An asset, position, or project which is considered protected by manage ...

Safe harbor lease: A lease to transfer tax benefits of ownership (depreciation and debt t ...

Safekeep: For a fee, bankers will hold in their vault, clip coupons on, and pres ...

Safety cushion: In a contingent immunization strategy, the difference between the init ...

Safety-net return: The minimum available return that will trigger an immunization strateg ...

Sale and lease-back agreement: Sale of an existing asset to a financial institution that then leases ...

Sales charge: The fee charged by a mutual fund when purchasing shares, usually payab ...

Sales forecast: A key input to a firm's financial planning process. External sales for ...

Sales-type lease: An arrangement whereby a firm leases its own equipment, such as Acer l ...

Salvage value: Scrap value of plant and equipment.

Salvage Value: Is the amount remaining after a depreciated useful life. It refers to ...

Samurai bonds: Foreign bonds issued in Japan.

Samurai market: The foreign market in Japan.

SAR: Saudi Riyal from Saudi Arabia. Each riyal is composed of 100 hallalahs ...

Savings and Loan association: A US-type state-chartered institution that accepts savings deposits an ...

Savings deposits: Accounts that pay interest, typically at below-market interest rates, ...

SBD: Solomon Islands Dollar from The Solomon Islands.

SBIC: Small Business Investment Company.

Scale: A bank that offers to pay different rates of interest on CDs of varyin ...



Scale enhancing: Describes a project that is in the same risk class as the whole firm.

Scale in: When a trader or investor gradually takes a position in a security or ...

Scalp: To trade for small gains. It normally involves establishing and liquid ...

Scalper: A trader who holds positions for a very short period of time.

Scalping: The practice of trading in and out of the market on very small price f ...

Scenario analysis: The use of horizon analysis to project bond total returns under differ ...

Scheduled cash flows: The mortgage principal and interest payments due to be paid under the ...

Scope creep: The temptation to add more and more features to a product release unti ...

SCR: Seychelles Rupee from the Seychelles and the British Indian Ocean Terr ...

SDD: Sudanese Dinar from Sudan.

SDP: Sudanese Pound from Sudan.

Search costs: Costs associated with locating a counterparty to a trade, including ex ...

Seasonal Adjustment: A statistical technique used to remove the effect of normal seasonal f ...

Seasoned datings: Extended credit for customers who order goods in periods other than pe ...

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

Seasoned new issue: A new issue of stock after the company's securities have previously be ...

Seat: Refers to membership on an exchange. A seat can be purchased or leased ...

SEC: The Security and Exchange commission (SEC) was created by the Securiti ...

Second pass regression: A cross-sectional regression of portfolio returns on betas. The estima ...

Secondary Distribution: The redistribution to the public of a block of shares owned by an exis ...



Secondary issue: A secondary issue is both a (a) procedure for selling blocks of season ...

Secondary market: The market where securities are traded after they are initially offere ...

Section 482: United States Department of Treasury regulations governing transfer pr ...

Sector: Refers to a group of securities that are similar with respect to matur ...

Secured debt: Debt that, in the event of default, has first claim on specified asset ...

Securitization: The process of creating a passthrough, such as the mortgage pass-throu ...

Security: Piece of paper that proves ownership of stocks, bonds and other invest ...

Security characteristic line: A plot of the excess return on a security over the risk-free rate as a ...

Security deposit (initial): Synonymous with the term margin. A cash amount of funds that must be d ...

Security market line: Line representing the relationship between expected return and market ...

Security market plane: A plane that shows the equilibrium between expected return and the bet ...

Security selection decision: Choosing the particular securities to include in a portfolio.

SEDAR: SEDAR (System for Electronic Document Analysis and Retrieval) is the C ...

Seed investing: Investment by a venture capital firm in a company before it has a real ...

Segregated Funds: These funds guarantee that, regardless how the fund performs, at least ...

SEK: Swedish Krona from Sweden. The plural form is kronor and one krona is ...

Self-liquidating loan: Loan to finance current assets, The sale of the current assets provide ...

Self-selection: Consequence of a contract that induces only one group (e.g. low risk i ...

Sell limit order: Conditional trading order that indicates that a security may be sold a ...

Sell-side analyst: Also called a Wall Street analyst, a financial analyst who works for a ...



Seller's Option: The right of a seller to select, within the limits prescribed by a con ...

Selling Away: When a broker solicits you to purchase securities not held or offered ...

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

Selling short: If an investor thinks the price of a stock is going down, the investor ...

Semi-strong form efficiency: A form of pricing efficiency where the price of the security fully ref ...

Senior debt: Debt that, in the event of bankruptcy, must be repaid before subordina ...

Seniority: The order of repayment. In the event of bankruptcy, senior debt must b ...

Sensitivity analysis: Analysis of the effect on a project's profitability due to changes in ...

Separate Trading of Registered Interest (STRIPS): Separate Trading of Registered Interest and Principal Securities (STRI ...

Separation property: The property that portfolio choice can be separated into two independe ...

Separation theorem: The value of an investment to an individual is not dependent on consum ...

Serial bonds: Corporate bonds arranged so that specified principal amounts become du ...

Serial covariance: The covariance between a variable and the lagged value of the variable ...

Series: Options: All option contracts of the same class that also have the sam ...

Series A: Series A usually refers to a class of shares subscribed for by venture ...

Series bond: Bond that may be issued in several series under the same indenture.

Set of contracts perspective: View of corporation as a set of contracting relationships, among indiv ...

Settlement: When payment is made for a trade.

Settlement date: The date on which payment is made to settle a trade. For stocks traded ...

Settlement price: The average of the prices that a futures contract trades for immediate ...

Settlement rate: The rate suggested in Financial Accounting Standard Board (FASB) 87 fo ...

SGD: Singapore Dollar from Singapore. The Singapore dollar, divided into 10 ...

Share: Companies issue shares as a means of raising equity finance and determ ...

Share repurchase: Program by which a corporation buys back its own shares in the open ma ...

Shareholders' equity: This is a company's total assets minus total liabilities. A company's ...

Shareholders' letter: A section of an annual report where one can find jargon-free discussio ...

Shares: Certificates or book entries representing ownership in a corporation o ...

Shark repellant: Amendment to company charter intended to protect it against takeover.

Shark Repellent: Number of measures taken by a corporation to discourage an unwanted ta ...

Sharpe benchmark: A statistically created benchmark that adjusts for a managers' index-l ...

Sharpe ratio: A measure of a portfolio's excess return relative to the total variabi ...

Shelf registration: A procedure that allows firms to file one registration statement cover ...

Shell Company: This term refers to a company that is listed on the Stock Market but n ...

Shingle Theory: A suitability doctrine first introduced by the SEC in the 30's. The id ...

Shipping Certificate: A negotiable instrument used by several futures exchanges as the futur ...

Shirking: The tendency to do less work when the return is smaller. Owners may ha ...

Shogun bonds: Shogun bonds consist of foreign-currency bonds issued in Tokyo in curr ...

Shop: Wall Street jargon for a firm.

Shopping: Seeking to obtain the best bid or offer available by calling a number ...

Short: One who has sold a contract to establish a market position and who has ...

Short bonds: Bonds with short current maturities.

Short hedge: The sale of a futures contract(s) to eliminate or lessen the possible ...

Short interest: This is the total number of shares of a security that investors have b ...

Short position: Occurs when a person sells stocks he or she does not yet own. Shares m ...

Short sale: Selling a security that the seller does not own but is committed to re ...

Short selling: Short selling, usually just referred to as "shorting", involves sellin ...

Short straddle: A straddle in which one put and one call are sold.

Short Term Gain: The profit realized from the sale of securities or other capital asset ...

Short-run operating activities: Events and decisions concerning the short-term finance of a firm, such ...

Short-squeezed: If the broker runs out of shares to borrow at any time while a short c ...

Short-term bonds: Bonds with a maturity of between one and five years.

Short-term financial plan: A financial plan that covers the coming fiscal year.

Short-term investment services: Services that assist firms in making short-term investments.

Short-term solvency ratios: Ratios used to judge the adequacy of liquid assets for meeting short-t ...

Short-term tax exempts: Short-term securities issued by states, municipalities, local housing ...

Shortage cost: Costs that fall with increases in the level of investment in current a ...

Shortfall risk: The risk of falling short of any investment target.

SHP: St Helena Pound from St Helena.

SIC: Abbreviation for Standard Industrial Classification (SIC). Each 4-digi ...

SIC Code: The Standard Industrial Classification (SIC) code is a numbering syste ...

Side effects: Effects of a proposed project on other parts of the firm.

Sight draft: Demand for immediate payment.

Signal: The process of conveying information through a firm's actions.

Signaling approach: Approach to the determination of the optimal capital structure asserti ...

Signaling view (on dividend policy): The argument that dividend changes are important signals to investors ...

SIMEX: SIMEX (Singapore International Monetary Exchange) is a leading future ...

Simple compound growth method: A method of calculating the growth rate by relating the terminal value ...

Simple interest: Interest calculated only on the initial investment.

Simple linear regression: A regression analysis between only two variables, one dependent and th ...

Simple linear trend model: An extrapolative statistical model that asserts that earnings have a b ...

Simple moving average: The mean, calculated at any time over a past period of fixed length.

Simple prospect: An investment opportunity where a certain initial wealth is placed at ...

Simulation: The use of a mathematical model to imitate a situation many times in o ...

Single country fund: A mutual fund that invests in individual countries outside the United ...

Single factor model: A model of security returns that acknowledges only one common factor.

Single index model: A model of stock returns that decomposes influences on returns into a ...

Single-payment bond: A bond that will make only one payment of principal and interest.

Single-premium deferred annuity: An insurance policy bought by the sponsor of a pension plan for a sing ...

Sinker: Sinking fund.

Sinking fund: A sinker is a fund created by a provision in many bond contracts that ...

Sinking Fund: A method whereby a company purchases a given percentage of its bonds o ...

Sinking fund requirement: A condition included in some corporate bond indentures that requires t ...

SIT: Tolar from Slovenia. Slovenia introduced its own currency, the Slovene ...

Size: Large in size, as in the size of an offering, the size of an order, or ...

Skewed distribution: Probability distribution in which an unequal number of observations li ...

Skip-day settlement: The trade is settled one business day beyond what is normal.

SKK: Slovak Koruna from Slovakia (The Slovak Republic). The Slovak Koruna ( ...

Slippage: The difference between estimated transaction costs and actual transact ...

SLL: Leone from Sierra Leone.

Small issues exemption: Securities issues that involve less than $1.5 million are not required ...

Small-firm effect: The tendency of small firms (in terms of total market capitalization) ...

Smart Card: The Smart Card (SC) is a sophisticated stored-value card that contains ...

Smile: A smile is the variation of implied volatility with strike price.

Smithsonian agreement: A revision to the Bretton Woods international monetary system which wa ...

Societe Anonyme (SA) or Sociedad Anonima (SA): A Societe Anonyme is a limited liability corporation established under ...

Soft Capital Rationing: Capital rationing that under certain circumstances can be violated or ...

Soft currency: A currency that is expected to drop in value relative to other currenc ...

Soft dollars: The value of research services that brokerage houses supply to investm ...

Soften: The process of a slowly declining market price.

Sole proprietorship: A business owned by a single individual. The sole proprietor pays no c ...

Solvency: The ability of a company to meet all its obligations.

SOS: Somali Shilling from Somalia.

Sovereign risk: The risk that a central bank will impose foreign exchange regulations ...

Span: To cover all contingencies within a specified range.

Sparbuch: An Austrian numbered savings account.

Special dividend: Also referred to as an extra dividend. Dividend that is unlikely to be ...

Special drawing rights (SDR): A form of international reserve assets, created by the IMF in 1967, wh ...

Special sauce: We can thank McDonald's for this one. It's used to refer to anything p ...

Specialist: On an exchange, the member firm that is designated as the market maker ...

Specialist System: A type of trading commonly used for the exchange trading of securities ...

Specialty fund: A mutual fund that concentrates its investments on a specific industri ...

Specific issues market: The market in which dealers reverse in securities they wish to short.

Spectail: A dealer that does business with retail but that concentrates more on ...

Speculative Bubble: A rapid, but usually short-lived, run-up in prices caused by excessive ...

Speculative demand (for money): The need for cash to take advantage of investment opportunities that m ...

Speculative grade bond: Bond rated Ba or lower by Moody's, or BB or lower by S&P, or an unrate ...

Speculative motive: A desire to hold cash for the purpose of being in a position to exploi ...

Speculator: One, who attempts to anticipate price changes and, through buying and ...

Spin-off: A company can create an independent company from an existing part of t ...

Split: The conversion of each existing share into two or more shares. Sometim ...

Split-fee option: An option on an option. The buyer generally executes the split fee wit ...

Split-rate tax system: A tax system that taxes retained earnings at a higher rate than earnin ...

Spot exchange rates: Exchange rate on currency for immediate delivery.

Spot futures parity theorem: Describes the theoretically correct relationship between spot and futu ...

Spot interest rate: Interest rate fixed today on a loan that is made today.

Spot lending: The origination of mortgages by processing applications taken directly ...

Spot month: The nearest delivery month on a futures contract.

Spot price: The current marketprice of the actual physical commodity. Also called ...

Spot rate: The theoretical yield on a zero-coupon Treasury security.

Spot rate curve: The graphical depiction of the relationship between the spot rates and ...

Spot trade: The purchase and sale of a foreign currency, commodity, or other item ...

Spot volatilities: The volatilities used to price a cap when a different volatility is us ...

Spread: A spread is either (a) the gap between bid and ask prices of a stock o ...

Spread income: Also called margin income, the difference between income and cost. For ...

Spread option: AN option where the payoff depends on the difference between two marke ...

Spread strategy: Spreading is a strategy that involves a position in one or more option ...

Spread transaction: A position in two or more options of the same type.

Spreadsheet: A computer program that organizes numerical data into rows and columns ...

Spud: To commence drilling for oil and/or gas; to sink a well.

Squeeze: A market situation in which the lack of supplies tends to force shorts ...

SRG: Surinam Guilder from Suriname.

Stagflation: A recently coined term that combines the economic effects of "inflatio ...

Stakeholders: All parties that have an interest, financial or otherwise, in a firm - ...

Stand-alone principle: Investment principle that states a firm should accept or reject a proj ...

Standard & Poor's 500: The Standard & Poor's 500 Index (S&P 500) is based on a portfolio of 5 ...

Standard & Poor's MidCap 400: The Standard & Poor's Midcap 400 Index is somewhat similar to the S&P ...

Standard Deviation: A common measure of spread in the sampling distribution of a random va ...

Standard error: In statistics, a measure of the possible error in an estimate.

Standardized normal distribution: A normal distribution with a mean of 0 and a standard deviation of 1.

Standardized value: Also called the normal deviate, the distance of one data point from th ...

Standby agreement: In a rights issue, agreement that the underwriter will purchase any st ...

Standby fee: Amount paid to an underwriter who agrees to purchase any stock that is ...

Standstill agreements: Contracts where the bidding firm in a takeover attempt agrees to limit ...

Stated annual interest rate: The interest rate expressed as a per annum percentage, by which intere ...

Stated conversion price: At the time of issuance of a convertible security, the price the issue ...

Stated maturity: For the CMO tranche, the date the last payment would occur at zero CPR ...

Statement billing: Billing method in which the sales for a period such as a month (for wh ...

Statement of cash flows: A financial statement showing a firm's cash receipts and cash payments ...

Statement of Financial Accounting Standards No. 52: This is the currency translation standard currently used by U.S. firm ...

Statement of Financial Accounting Standards No. 8: This is a currency translation standard previously in use by U.S. acc ...

Statement-of-cash-flows method: A method of cash budgeting that is organized along the lines of the ca ...

Static hedge: A hedge that does not have to be changed once it is initiated.

Static options replication: A static options replication is a procedure for hedging a portfolio th ...

Static theory of capital structure: Theory that the firm's capital structure is determined by a trade-off ...

Statute of Limitations: The deadline after which a party claiming to be injured by the settlor ...

Statutory surplus: The surplus of an insurance company determined by the accounting treat ...

STD: Dobra from São Tomé and Príncipe.

Steady state: As the MBS pool ages, or four to six months after it was passed at lea ...

Steepening of the yield curve: A change in the yield curve where the spread between the yield on a lo ...

Step-up: To increase, as in step up the tax basis of an asset.

Step-up bond: A bond that pays a lower coupon rate for an initial period which then ...

Step-up swap: A swap where the principal increases over time in a predetermined way.

Sterilized intervention: Foreign exchange market intervention in which the monetary authorities ...

Stochastic models: Liability-matching models that assume that the liability payments and ...

Stochastic process: An equation describing the probabilistic behavior of a stochastic vari ...

Stochastic variable: A variable whose future value is uncertain.

Stock: Ownership of a corporation which is represented by shares which repres ...

Stock dividend: Payment of a corporate dividend in the form of stock rather than cash. ...

Stock exchanges: In the US, a stock exchange is a formal organization, approved and reg ...

Stock index: A stock index tracks changes in the value of a hypothetical portfolio ...

Stock index option: An option in which the underlying is a common stock index.

Stock market: Also called the equity market, the market for trading equities.

Stock option: An option in which the underlying is the common stock of a corporation ...

Stock replacement strategy: A strategy for enhancing a portfolio's return, employed when the futur ...

Stock repurchase: A firm's repurchase of outstanding shares of its common stock.

Stock selection: An active portfolio management technique that focuses on advantageous ...

Stock split: Occurs when a firm issues new shares of stock but in turn lowers the c ...

Stock ticker: This is a lettered symbol assigned to securities and mutual funds that ...

Stockholder: Holder of equity shares in a firm.

Stockholder equity: Balance sheet item that includes the book value of ownership in the co ...

Stockholder's books: Set of books kept by firm management for its annual report that follow ...

Stockholder's equity: The residual claims that stockholders have against a firm's assets, ca ...

Stockout: Running out of inventory.

Stop Limit Order: A stop limit order is an order that goes into force as soon as there i ...

Stop order (or stop): An order to buy or sell at the market when a definite price is reached ...

Stop-limit order: A stop order that designates a price limit. In contrast to the stop or ...

Stop-loss order: An order to sell a stock when the price falls to a specified level.

Stopping curve: A curve showing the refunding rates for different points in time at wh ...

Stopping curve refunding rate: A refunding rate that falls on the stopping curve.

Storage costs: The cost of storing commodity.

Straddle: A long position in a call and a put with the same exercise price.

Straight line depreciation: An equal dollar amount of depreciation in each accounting period.

Straight value: Also called investment value, the value of a convertible security with ...

Straight voting: A shareholder may cast all of his votes for each candidate for the boa ...

Strangle: A long position in a call and a put with different strike prices.

Strap: A long position in two call options and one put option with the same e ...

Stratified equity indexing: A method of constructing a replicating portfolio in which the stocks i ...

Stratified sampling approach to indexing: An approach in which the index is divided into cells, each representi ...

Stratified sampling bond indexing: A method of bond indexing that divides the index into cells, each cell ...

Street: Brokers, dealers, underwriters, and other knowledgeable members of the ...

Street name: Describes securities held by a broker on behalf of a client but regist ...

Stress testing: Testing of the impact of extreme market movements on the value of a po ...

Strike index: For a stock index option, the index value at which the buyer of the op ...

Strike price: The stated price per share for which underlying stock may be purchased ...

Strip: A long position in one call option and two put options with the same e ...

Strip Bonds: The capital portion of a bond from which the coupons have been strippe ...

Strip PC: Strip mortgage participation certificate (strip PC) is an ownership in ...

Stripped bond: Bond that can be subdivided into a series of zero-coupon bonds.

Stripped mortgage-backed securities (SMBSs): Securities that redistribute the cash flows from the underlying gener ...

Strong Hands: When used in connection with delivery of commodities on futures contra ...

Strong-form efficiency: Pricing efficiency, where the price of a, security reflects all inform ...

Structured arbitrage transaction: A self-funding, self-hedged series of transactions that usually utiliz ...

Structured debt: Debt that has been customized for the buyer, often by incorporating un ...

Structured portfolio strategy: A strategy in which a portfolio is designed to achieve the performance ...

Structured settlement: An agreement in settlement of a lawsuit involving specific payments ma ...

Stub: New shares issued in exchange for old shares in a leveraged recapitali ...

Subject: Refers to a bid or offer that cannot be executed without confirmation ...

Subject to opinion: An auditor's opinion reflecting acceptance of a company's financial st ...

Subjective probabilities: Probabilities that are determined subjectively (for example, on the ba ...

Subordinated debenture bond: An unsecured bond that ranks after secured debt, after debenture bonds ...

Subordinated debt: Debt over which senior debt takes priority. In the event of bankruptcy ...

Subordination clause: A provision in a bond indenture that restricts the issuer's future bor ...

Subpart F: Special category of foreign-source "unearned" income that is currently ...

Subperiod return: The return of a portfolio over a shorter period of time than the evalu ...

Subscription price: Price that the existing shareholders are allowed to pay for a share of ...

Subsidiary: With the regards to the euromarkets, a subsidiary is foreign-based aff ...

Subsidy: A financial contribution by government (including any form of income o ...

Substitute sale: A method for hedging price risk that utilizes debt-market instruments, ...

Substitution swap: A swap in which a money manager exchanges one bond for another bond th ...

Sum-of-The-Parts-Valuation (SoTP): An approach to valuing a company in which each business unit / operati ...

Sum-of-the-years-digits depreciation: The sum-of-the-years-digits (SOTYD) depreciation is a method of accele ...

Sunk costs: Costs that have been incurred and cannot be reversed.

Supermajority: Provision in a company's charter requiring a majority of, say, 80% of ...

SuperMontage: The SuperMontage is NASDAQ's trading system to aggregate quotes and or ...

Supply shock: An event that influences production capacity and costs in an economy.

Support level: A price level below which it is supposedly difficult for a security or ...

SUR: Union of Soviet Socialist Republics Rouble from the Union of Soviet So ...

Surplus funds: Cash flow available after payment of taxes in the project.

Surprise: A company earnings report that deviates (either positively or negative ...

Surtax: An additional tax levied as a percentage of an income tax amount. Both ...

Sushi bond: A eurobond issued by a Japanese corporation.

Sustainable growth rate: Maximum rate of growth a firm can sustain without increasing financial ...

SVC: El Salvadorian Colón from El Salvador.

Swap: A swap is an agreement to exchange a series of variable cash flows for ...

Swap buy-back: The sale of an interest rate swap by one counterparty to the other, ef ...

Swap rate: The fixed rate in an interest rate swap that causes the swap to have a ...

Swap reversal: An interest rate swap designed to end a counterparty's role in another ...

Swap sale: A swap sale (also referred to as a swap assignment) is a transaction t ...

Swaption: A swaption is an option to enter into an interest rate swap where a sp ...

Sweep account: Account in which the bank takes all of the excess available funds at t ...

Sweet Oil and Gas: Petroleum containing little or no hydrogen sulphide.

SWIFT: Society for Worldwide Interbank Financial Telecommunications (SWIFT) i ...

Swing Option: A swing option are found in the energy market. Its value depends on th ...

Swingline facility: Bank borrowing facility to provide finance while the firm replaces U.S ...

Swissy: Jargon for the Swiss Franc (CHF).

Switch: Offsetting a position in one delivery month of a commodity and simulta ...

Switching: Liquidating an existing position and simultaneously reinstating a posi ...

SWOT analysis: A SWOT analysis assesses the strenghts, weaknesses, opportunities and ...

Symmetric cash matching: An extension of cash flow matching that allows for the short-term borr ...

Synchronous data: Data available at the same time. In testing option-pricing models, the ...

Syndicate: A group of banks that acts jointly, on a temporary basis, to loan mone ...

Synergistic effect: A violation of value-additivity whereby the value of the combination i ...

Synthetic Futures: A position created by combining call and put options. A synthetic long ...

Synthetic Option: A synthetic is an option created by trading the underlying asset.

Synthetic short sale: Buy one put option and write one call option.

Synthetics: Customized hybrid instruments created by blending an underlying price ...

SYP: Syrian pound from Syria.

Systematic: Common to all businesses.

Systematic risk: The systematic risk of an asset or portfolio is the risk that cannot b ...

Systematic risk principle: Only the systematic portion of risk matters in large, well-diversified ...

SZL: Lilangeni from Swaziland.

Did you know?

Unsterilized intervention

Foreign exchange market intervention in which the monetary authorities have not insulated their domestic money supplies from the foreign exchange transactions.


Popular terms


About us  About bizterms.net
Contact us  Contact us
Bookmark us