Short interest

Similar financial terms

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

Short selling
Short selling, usually just referred to as "shorting", involves selling an asset that is not in posession. Suppose an investor instructs a broker to short 20,000 STL shares. The broker will carry out the instructions by borrowing the shares from another client and selling them in the market in the usual way. The investor can maintain the short position for as long as desired, provided there are always shares for the broker to borrow. At some stage, however, the investor will close out the positi ...

Short-squeezed
If the broker runs out of shares to borrow at any time while a short contract is open, the investor is short-squeezed and is forced to close out the position immediately even if not ready to do so.

Short Term Gain
The profit realized from the sale of securities or other capital assets possessed for twelve months or less.

Creditors, short
This is all current liabilities payable on demand or within one year of the Balance Sheet date. For Banks this also includes short term bank liabilities such as deposits.

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

Short-term tax exempts
Short-term securities issued by states, municipalities, local housing agencies, and urban renewal agencies.

Short-term solvency ratios
Ratios used to judge the adequacy of liquid assets for meeting short-term obligations as they come due, including (a) the current ratio, (b) the acid-test ratio, (c) the inventory turnover ratio, and (d) the accounts receivable turnover ratio.

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

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

Short-run operating activities
Events and decisions concerning the short-term finance of a firm, such as how much inventory to order and whether to offer cash terms or credit terms to customers.

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

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

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

Short sale
Selling a security that the seller does not own but is committed to repurchasing eventually. It is used to capitalize on an expected decline in the security's price.

Short position
Occurs when a person sells stocks he or she does not yet own. Shares must be borrowed, before the sale, to make "good delivery" to the buyer. Eventually, the shares must be bought to close out the transaction. This technique is used when an investor believes the stock price will go down.

Short hedge
The sale of a futures contract(s) to eliminate or lessen the possible decline in value ownership of an approximately equal amount of the actual financial instrument or physical commodity.

Short bonds
Bonds with short current maturities.

Short
One who has sold a contract to establish a market position and who has not yet closed out this position through an offsetting purchase; the opposite of a long position.

Selling short
If an investor thinks the price of a stock is going down, the investor could borrow the stock from a broker and sell it. Eventually, the investor must buy the stock back on the open market. For instance, you borrow 1000 shares of British Petroleum on July 1 and sell it for £8 per share. Then, on Aug 1, you purchase 1000 shares of BP at £7 per share. You've made £1000 (less commissions and other fees) by selling short.

Interest-rate risk on bonds
The price of a typical bond will change in the opposite direction from a change in interest rates. As interest rates rise, the price of a bond will fall; as interest rates fall, the price of a bond will rise. The actual degree of sensitivity of a bond’s price to changes in market interest rates depends on various characteristics of the issue maturity, coupon and special provisions.

Accrued interest
Interest earned but not yet due and payable. In the context of bond, it is the next coupon to be paid multiplied by the time elapsed since the last payment date and divided by the total coupon period.

Zero-coupon interest rate
The interest rate that would be earned on a bond that provides no coupons.

Term structure of interest rates
The relationship between interest rates and their maturities.

Fixed interest securities
Fixed interest securities relates to bonds, bills, stocks and debentures which offer a fixed rate of interest per period. The purchaser buys the income stream and the seller receives loan.

Amortizing interest rate swap
Swap in which the principal or national amount rises (falls) as interest rates rise (decline).

True interest cost
For a security such as commercial paper that is sold on a discount basis, the coupon rate required to provide an identical return assuming a coupon-bearing instrument of like maturity that pays interest in arrears.

Times-interest-earned ratio
Earnings before interest and tax, divided by interest payments.

Stated annual interest rate
The interest rate expressed as a per annum percentage, by which interest payment is determined.

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

Simple interest
Interest calculated only on the initial investment.

Real interest rate
The rate of interest excluding the effect of inflation; that is, the rate that is earned in terms of constant-purchasing-power dollars. Interest rate expressed in terms of real goods, i.e. nominal interest rate adjusted for inflation.

Rate of interest
The rate, as a proportion of the principal, at which interest is computed.

Pooling of interests
An accounting method for reporting acquisitions accomplished through the use of equity. The combined assets of the merged entity are consolidated using book value, as opposed to the purchase method, which uses market value. The merging entities' financial results are combined as though the two entities have always been a single entity.

Open interest
The total number of derivative contracts traded that not yet been liquidated either by an offsetting derivative transaction or by delivery.

Nominal interest rate
The interest rate unadjusted for inflation.

Minority interest
An outside ownership interest in a subsidiary that is consolidated with the parent for financial reporting purposes.

Benchmark interest rate
Also called the base interest rate, it is the minimum interest rate investors will demand for investing in a non-Treasury security. It is also tied to the yield to maturity offered on a comparable-maturity Treasury security that was most recently issued ("on-the-run").

Best-interests-of-creditors test
The requirement that a claim holder voting against a plan of reorganization must receive at least as much as he would have if the debtor were liquidated.

Capitalized interest
Interest that is not immediately expensed, but rather is considered as an asset and is then amortized through the income statement over time.

Cash flow after interest and taxes
Net income plus depreciation.

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

Covered interest arbitrage
A portfolio manager invests dollars in an instrument denominated in a foreign currency and hedges his resulting foreign exchange risk by selling the proceeds of the investment forward for dollars.

Separate Trading of Registered Interest (STRIPS)
Separate Trading of Registered Interest and Principal Securities (STRIPS) are securities that have their periodic interest payments separated from the final maturity payment and the two cash flows are sold to different investors.

Net interest margin (NIM)
The difference between interest income and interest expense as a percentage of assets.

Nominal rate of interest
The annual return form lending money expressed as a percentage, without having taken account of the rate of inflation.