Discount Securities Discounted issue of money market instruments of the non interest carrying kind. At maturity, these are redeemed for the whole face value. Treasury bills in U.S. are examples of discount security. … [Read more...]
Discounted Basis
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Discounted Basis Making up the interest payable on an instrument by selling at a discounted price. This price is lower than the value of this instrument on its maturity date, the difference representing the discount. … [Read more...]
Discounted Payback Period Rule
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Discounted Payback Period Rule Decision making rule for investing where it is considered that cash flows are discounted at a rate of interest and the rule of payback is effected on such cash flows with discounts. … [Read more...]
Discounting
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Discounting Computing a future amount’s present value by a process that is contrary/ opposite to calculations using compounding. … [Read more...]
Discounts For Lack Of Marketability
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Discounts For Lack Of Marketability Evaluation method to measure value of closely held, restricted shares. Based on the concept that there is a discount between the stock value that is and is not saleable. … [Read more...]
Discrete Compounding M
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Discrete Compounding M Computing the money time value by compounding over discrete time periods. … [Read more...]
Discrete Random Variable
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Discrete Random Variable This variable can only take the given classes of discrete probable values. For instance, it may take the value of positive integers- 1, 2, 3 and so on. … [Read more...]
Discretionary Account
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Discretionary Account Organization or individual controlled accounts wherein the person named as holder of account differs from the one having control or trading authority over it. … [Read more...]
Discretionary Cash Flow
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Discretionary Cash Flow Flow of funds available once the financing of capital investment projects with positive NPVs is done. These funds are used for many purposes, for example, to pay cash dividends, repurchase common stock, retire debt. … [Read more...]
Discriminant Analysis
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Discriminant Analysis Technique used in statistics that relates the default possibility to some given financial ratios. … [Read more...]
Diseconomies Of Scale
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Diseconomies Of Scale A situation where economies of scale no longer apply for a firm. Thus the firm’s marginal cost increases when output increases. … [Read more...]
Disintermediation
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Disintermediation Drawing of funds/ cash from any financial institution/ bank for directly investing them in various instruments. … [Read more...]
Distributed
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Distributed Sale of new issues held by a dealer after he has participated in Treasury auction. … [Read more...]
Distributions
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Distributions Pay outs generated by fund or cash flow in corporate entities. Can encompass dividends, capital gains arising from investment sales and repayment of capital. Such distributions may come in the form of check payments or investments in more shares or DRIPS. Applicable … [Read more...]
Divergence
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Divergence A failure to display confirming or matching trends by two or more indices or averages … [Read more...]
Diversifiable risk
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Diversifiable risk Refer: unsystematic risk. Risk that can be reduced by diversification. … [Read more...]
Diversification
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Diversification Minimizing unsystematic risk by investing in an assortment of different securities with varying risk, returns as well as correlation statistics. … [Read more...]
Dividend
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Dividend A share or portion of profit paid by the company to shareholders (both preferred and common). For example, stock with sale price of $50 a share paying yearly dividend of $2.50 per share yields an earning of 5% to the investor. … [Read more...]
Dividend Arbitrage
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Dividend Arbitrage Strategy used in options trading involving buying of put options and also equivalent underlying stock prior to ex-dividend date. Once the dividend is collected the option is exercised. … [Read more...]
Dividend Clawback
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Dividend Clawback Term used in project financing. Refers to a formal arrangement wherein project sponsors agree to put in equity drawn from prior dividends generated from the same project to make good any lack of funds. … [Read more...]
