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Glossary of terms used on this site

  Glossary of terms used on this site
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Glossaries

Term Definition
American Option

A put or call that can be exercised at any time prior to expiration. Most listed stock options, including those on European exchanges are US style options. Important exceptions are certain low strike price

Accrued Interest

The interest accruing on a security since the previous coupon date. If a security is sold between two payment dates, the buyer usually compensates the seller for the interest accrued, either within the price or as a separate payment.

Adhoc Margin

Margin collected by the Stock Exchange from the members having unduly large outstanding position or the margin levied on volatile scrips based on adhoc basis keeping in view the risk perspective.

Admission to Dealing

The process of granting permission to the securities of a company to be listed in a Stock Exchange and to provide trading facilities for the securities in the market.

Allotment Advice

A letter sent to the successful applicant by the company stating allotment of shares or debentures or other securities against his application. The advice is not negotiable in the market.

Analyst

A firm / company / an individual who is engaged either on his own behalf or on behalf of any other firm or organization that is regularly publishing securities recommendations based on research either through print media and /or electronic media.

Arbitration

An alternative dispute resolution mechanism provided by a stock exchange for resolving disputes between the trading members and their clients in respect of trades done on the exchange.

Asset Allocation

The process of determining the optimal division of an investor’s portfolio among different assets. Most frequently this refers to allocations between debt, equity, and cash

Asset Allocation Fund

A mutual fund that splits its investment assets among stocks, bonds, and other vehicles in an attempt to provide a consistent return for the investor.

Asset Management

The function of managing the assets on behalf of a customer, usually for a fee.

Asset Management Company

A company which handles the day to day operations and investment decisions of a unit trust.

Asset-backed securities

Securities backed by assets that are not mortgage loans. Examples include assets backed by automobile loans, credit card receivables and others.

Auction

When a seller is not in a position to deliver the securities he has sold, the buyer sends in his applications for buying-in, so that the securities can be bought from the market and delivered to him. This process by which the securities are procured on behalf of the defaulter is known as Auction.

Authorized Assistant

Assistant or clerk of members who are authorized to do business on their behalf in the market. The member has to take responsibility of fulfilling all the transactions and business commitments of the authorized assistants entered into on behalf of the members.

Authorized Capital

The amount of capital that a company has been authorized to raise by way of equity and preference shares, as mentioned in the Articles of Association / Memorandum of Association of the company.

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