Kredxionary

Kredxionary

Kredxionary
Bear Hug



Bear Hug is an approach a company makes to the board of another company, indicating that an offer is about to be made for their shares.
Securities Transaction Tax (STT)



During the 2004-05 Budget, the government abolished long-term capital gains tax on shares (tax on profits made on sale of shares held for more than a year) and replaced it with the STT which is a type of turnover tax where the investor has to pay a small tax on the total consideration paid/received in a share transaction.
Vertical Integration



Vertical Integration refers to a process in business where one company buys another company that supplies it with goods or that buys goods from to gain control over all production processes system.
Society for Worldwide Interbank Financial Telecommunication (SWIFT)



SWIFT is a globally recognized identification code for banks worldwide which is used for international wire transfers. Only those banks that are SWIFT-enabled can take part in this systm.
Ad Valorem Tax



An ad valorem tax is a tax where the amount depends on the value of a property or of transaction. It is imposed at the time of the transaction, as in the case of value-added tax (VAT) or sales tax.
Buyer's Market



Buyer's Market is a market where the supply of goods seems pletiful and prices seem low. It is the opposite of a seller's market.

Over The Counter Markets



Over the counter market is a decentralised market (without physical location), where the participants trade with each over communication network, like telephone, email and others
Index Fund



An index fund is a mutual fund, that allows investor to "invest" in an index. Index funds are designed to give investors returns that are in line with the index. Index funds are an example of "passive" investing, as there are no funds managers. The funds mirror the returns of the index and usually have low expense ratios, making them cost-effective investments.
Contestable Market



A contestable market is a market in which an inefficient firm or one earning excess profits, is likely to be driven out by a more efficient or less profitable rivl. A market can be contestable even if it is dominated by a single firm, which appears to enjoy a monopoly with market power, and the new entrant exists only as potential competition.
Alligator Spread



An unprofitble spread that occurs as a result of large commissions charged on the transaction, regardless of favourable market movements. An alligator spread is usually used in the options market to describe a collection of put and call options that may not be profitable.
Baby Bonds



In the US, bonds having a denomination lower than $1000 are called baby bonds. It is also a nickname for children's trust funds.
Appreciation



Appreciation is the rise in the value of an asset and the opposite of depreciation. When the value of a currency rises relative to another, it appreciates.
Volatility



Volatiliy refers to the degree of trading price variation over time. If the price of a stock moves up and down rapidly over short time periods, it has high volatility and vice versa.
Bed and Breakfast



Bed and Breakfast is an operation on the London Stock Exchange in which a shareholder sells a holding the previous evening and makes an aggreement with the broker to buy back the same holding when the market re-opens next.
Arbitrage


Arbitrage is the process of simultaneously selling an asset in two different markets with the intension of profiting on the prevalent price difference.
Expense Ratio


Expense ratio is the annual fee investors pay to mutual fund managers towards the expenses incurred to run mutual funds.
Money Market


Money Market ia a sub-section of the fixed income market such as T-Bills, CDs, Commercial Paper, etc.They are also called short-term debt securities and have tenures lesser than 1 year.
Underbanked



This depicts an individual or business who won't utilise the standard financial services offered by banks. They mostly depend on hard-cash as opposed to on new-age financing credit cards or checks as a mode for funding.
Accounts Receivables



Accounts Receivables is the amount of money clients owe to the businesses. The details of the accounts receivable is mentioned on the invoices that businesses issue and these are often logged in as asset in the balance sheet.
Command Economy



Command Economy is when the Government controls all aspects of economic activity.
Thrillionare



A new class of high-tech entrepreneurs looking to use their wealth to make science-fiction dreams into a modern reality. Eg: Elon Musk
Absolute Advantage



Absolute Advantage is the ability of a party (an individual, a firm or country) to produce a greater quantity of goods, products or services than competitors using the same amount of resources.
Command Economy



Command Economy is when the Government controls all aspects of economic activity.
Credit Creation



Credit Creation is the process of making loans. Often the amount of credit creation is subject to regulation. Lenders may have limits on the amount of loans they can make relative to the assets they have, so that they run little risk of bankruptcy.
Currency Peg



Currency Peg is when the government announces that the exchange rate of its currency is fixed against another currency or currencies.
Jump the shark


A metaphor from the business world used when a business or product is past its prime and is struggling to stay relevant.
Zombies



A term given to companies that are functioning near insolvency. The unpredictability of their is in the same bracket as determining the "natural" lifetime of a zombie.
Acqui-hire


This refers to the buying out of a company not for its products or services, but for the skills and expertise of its staff.
Sleeping Beauty



A sleeping beauty refers to a profitable company (usually start-ups) with impressive assets but bad management. These companies are great candidates for takeovers.
Indemnity



Indemnity refers to an exemption from the liability of potential damages . The concept could also refer to a scenario in which a particular party agrees to pay a secondary party for the losses caused by the latter.
Pass The Book


To transfer the management of a financial position from one office of a business to another in a different time zone to take advantage of 24-hour trading.
Capital Intensive


Capital Intensive is a production prrocess that involves comparatively large amounts of capital. It is the opposite of labour intensive.
Basis Point



A basis point is one one-hundredth of a percentage point. Any changes in the interest rate, exchange rate and bond yields are often described in terms of basis points. Eg: If the interest rate moves from 3.15% to 3.35%, it has risen by 20 basis points.
Robo-Adbisor


Robo-advisors are financial advisors who provide investment recommendatiin using computer algorithms with moderate to minimal human help. These advisors use software to run alogrithms to automatically assign, manage, and optimize investor's assets.
Acid Test


An acid test is a stern measure of a company's ability to pay its short term debts which excludes the stock from the asset value.
Deflation



Deflation refers to the scenario in which the supply of money inside a society dwindles and consequently the prices of commodities decrease.
Dawn Raid


An attempt to acquire a significant holding in the equity of another company by instructing brokers to buy all the shares available in that company as soon as the stock exchange opens.
Ankle Biters


Ankle Biters are refered to small cap companies that are worth between 300 million to 2 billion.
Wantrepreneur



An informal term for someone who would like to start a business & procrastinates and talks about doing so, but never gets started.
Dead Cat Bounce



A temporary recovery on a stock exchange, after a substantial fall. It does not imply a reversal of the downward trend, much like a dead cat bouncing off the ground would not come back to life.
Valium Picnic



A colloquial name for a non-trading day on a stock exchange or other commercial market. In other words, it is a market holiday.
Break-Even Point



Break-even point (BEP) is the point in a company's annual output where the number of units sold or services provided produces enough profit to cover all fixed overhead costs of operations for a specific time period.
Mumpreneur


A mother who starts a business so that she can combine working with looking after her children.
Selling Short



Selling short or short seliing is when an investor borrows shares of stock or another asset he or she doesn't own, sells it, takes the money with the promise to replace the property someday, and hopes the asset declines in price so it can be repurchased at a lower cost, the differstial becomial the profit. Done wrongly, it can lead to bankcruptcy.
Auction Market



An auction market is a market in which buyers enter competitive bids and sellers entere competitive offers at the same time.
Alpha



Alpha is a measure of investment performance adjusted for risk or the part of your investment return that is more than a benchmark market index.
Market Capitalisation



The market cap of a company is arrived at by multiplying its current share price by the number of shares outstanding. The market companies have market caps in the billions.
PEG Ratio



It is a modified form of the p/e ratio that factors growth into the valuation metric to determine the relative trade-off between the price of a stock, the earnings generated per share and the company's expected growth.
Elevator Pitch



A short sales pitch that lays out the idea for a product or service. An elevator pitch refers to an entrepreneur's attempt to persuade a venture capitalist that the business idea merits puttig reources into.
Barter



Barter is paying for goods or services with other goods or services, instaed of with money. It is often popular when the quality of money is low or incertain due to high inflation or counterfeiting, when people are asset-rich but cash-poor, or when taxation/extortion by criminals is high.
Open-Ended Investment Company



An OEIC is a type of fund that is able to invest in other companies with an ability to constantly adjust its investment criteria and size, thereby, gaining the being 'open ended'.
Direct Cost



Direct Cost refers to the cost inccured in producing a product. It includes materialcost, labour expenses, distribution costs, et al.
Creditor

Creditor is a lender whether by making a loan, buying a bond or allowing money owed now to be paid in the future.
Capital Adequacy Ratio

Capital Adequacy ratio is the ratio of a bank's capital to its total assets required by requlators to be above minimum level, so that there is little risk of the bank going bust. The ratio determines how high this minimum level is and may vary according to how risky a bank's activities are.
Hostile Takeover

A tender offer pitched so hign that the management of the target company is unable to discourage shareholders from accepting it. In other words, an offer that cannot be refused.
Closed Economy

A closed economy is defined as an economy that does not take part in international trade. It is the opposite of an open economy. Example: North Korea.
Cash Flow Statement

A cash flow statement is an indication of the money that entered and exited a business during a specific period of time. It generally covers forus main categories: operating activities,investing, financing activities and misc. information.
Radio silent

A usage to describe when you don't hear from a customer or prospect for a while. Example: The client has gone radio silent.
Killer Bee

An investment banker who helps a business resist a predatory takeover bid. These bankers are called killer bees since despite being small, they aggressively swarm and take dowm something much bigger.
Shark Watcher

A firm that specializes in keeping a look-out for takeovers. Usually this means monitoring trading, keeping track of who's accumulating shares, and reporting noteworthy activity back to clients.
Corset

A corset is a government restriction on the growth of bank deposits. This indirectly affects bank lending and money supply.
Cash flow statement

A cashflow statement provides an overview of a company's revenues and expenses. Cash flow statements are used to get an aggregate of a company's revenue streams as well as expenses.
Big Uglies

Big uglies are older companies that have been around for a long time. They mainly deal in older industrial sectors like coal and steel.
Zombie Startup

A company which claims to have continuing operations but does not demonstarte growth in website visitations or use in recent quarters.
Pass The Book

TO transfer the management of a financial position from one office of a business to another in a different time zone to take advantage of 24-hour trading.
Ombudsman

An ombudsman is someone whose job is to deal with complaints that people make about an organisation or particular type of business
Passive Fund

A passive fund is a type of investment vehicle that tracks a market index or a specific market segment. In the case of such funds, the fund manager does not make the active decision in which exact securies they want to down.
Decacorns

This is a term coined by Bloomberg in 2015 for companies valued at over $10 Billion. Some of the notable members of the club are WhatsApp, Uber, Airnb, WeWork, SpaceX, snpChat, etc.
Tip From A Dip

Financial advice from someone who claims to have inside information that could impact stock price. Tips from the dips are obviously illegal.
Adaptative Expectations

Adaptative Expectations is the theory of how people from their views about the future that assumes they do so using past trends and the errors in their own earlier predictions. It is a contrast with rational expectations.
Cliff

In the startup world, a cliff is the term used to describe the length of time before either a startup founder or a recipient of stock option first becomes partially vested in their restricted stock or stock options.
Assignor

An assignor is a persona who has the power to transfer the right they hold to another person or entity.
Market Sentiments

Its the feeling or tone of a market or its crowd psychology, as revealed through the activity and price movement os the securities traded in particular market.
Certificate Of Deposit

It is a promissory note issued by Bank in lieu of initial investment by its holder. CD restricts access to the funds until the maturity date of investment.
Promissory Notes



A Financial instruments that contains a written promise by one party to pay another party a definite sum of money either on demand or at a specified future date.
Treasury Bills


These instruments (by GoI to raise funds) are sold at a price less than their face value, the difference is profit for the investor.
Mutual Funds


Mutual Funds are entities that bring people and their money together to invest in stocks, bonds and other securities.
Debt Instruments


These are electronic or paper obligation that enables the issuing party to raise funds by promising to repay a lender according to the terms of a contract.
Non Negotiable Instruments


The price of a good or security that is firmly established and can not be adjusted.

Examples: Promissory Notes, Bills of Exchange , banknotes, demand draft and cheques.
Balance Sheet



A statement of the assets, liabilities and capital of the business at the particular point in time, detailing the balance of the income and expenditure over the preceding period
CASA (Current Account and Savings Account)


CASA deposit is the amount of money that gets deposited in the current and savings account of banks customers. It is the cheapest and major source of funds for banks
Subsidies


A subsidy is the benefit given by government to groups or individuals in the form of cash credit or tax reduction.
Penny Stocks



Penny Stocks are stocks available in the penny, in India the price could be anywhere in between Rs. 1 to Rs. 10. These are highly speculative stocks.

DEMAT Or Dematerialisation



The Securities in the form of bonds and certificates being converted to electronic format and hence traded resulting in simplified book keeping
CRR



Cash Reserve Ratio is a specified minimum fraction of the total deposits, which commercial banks have to hold as reserves either in cash or as deposits with the central bank (RBI in case of India).
Bullion



Bullion is typically gold and silver bars and ingots which are 99.5% pure.
1. Pure Bullion- parted
2. Bullion having two or more types of metal - Un-parted

Forex Reserves



Foreign exchange reserves are reserve assets held by a central bank in foreign currencies, used to back liabilities on their own issued currency as well as to influence monetary policy.
Liquidate



As a business and legal term, liquidation refers to the closing of a business and distribution of its assets to the creditor and/or owner of the business.
Equity Market



The Markets in which shares of the companies are issued and traded through exchanges or over the counter markets. Also known as stock market.
OTC Markets



Over the Counter Markets are decentralized market (without physical location), where the participants trade with each over communication network like telephone email and others.
Capital Markets



These are platforms for buying and selling of debt and equity instruments between supplier like retail and institutional investor to users like businesses and governments etc.
Money Markets



Money markets is a sub section of fixed income market, they are also called short term debt securities(tenure - less than one year).

Like T-Bills, CDs, Commercial paper etc.
Bancassurance



Banks and insurance company come up in a partnership wherein the bank sell the tied insurance company's insurance products to its clients.

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