Securities
Bonds
Economic Factors
Bullish/Bearish
Yields
100
Stock a corporation has issued and subsequently repurchased from the public.
What is Treasury Stock?
100
Under the Standard & Poor's rating of Bank-grade bonds, this is the highest score that can be assighed to a bond?
What is AAA?
100
The four stages of this cylcle are expansion, peak, contraction and trough
What is the business cycle?
100
Long call, short put
What options position is bullish?
100
This measures a bond's annual interest relative to its market price. Annual interest/market price = this
What is current yield?
200
Voting method which allows stockholders to allocate their votes in a manner they choose. This type of voting may be advantageous for small shareholders by giving them a greater opportunity to offset the votes of larger shareholders by combining their shares on a single seat.
What is Cumulative Voting?
200
The only mortgaged-backed bond that has the highest degree of safety and is backed by the full faith and credit of the US government. (provides investors with a monthly income)
What is Ginnie Mae or GNMA?
200
These occur when the GDP declines for six consecutive months (two quarters).
What is a recession?
200
Long call, Long put
What positions have rights?
200
This reflexts the annualized return of the bond held to maturity. The bondholder takes into account the difference between the price paid for a bond and par value.
What is yield to maturity?
300
This rule states stockholders cannot lose more than the amount they have paid for a corporations stock and also protects stockholders from having to pay a corporation's debts in bankruptcy
What is limited liability?
300
When a bond doesn't pay interest, it is said to do this. Zero-coupon bonds, income (adjustment) bonds, and any bond in default is considered to be this.
What is to trade flat?
300
This committee was created to direct teh Federal Reserve Board's open market operations. When they buy securities, it increases the supply of money in the banking system and when they sell securities it decreases the supply of money in the banking system.
What is th Federal Open Market Committee (FOMC)?
300
Long Call, Short Put
Which positions buy stock at exercise?
300
This is backed by the taxing power of the issuer, are usually safer than revenue bonds.
What is a General Obligation (GO)?
400
Commercial Paper, Municipal Notes and Treasury bills are all examples of this.
What is a Money Market Instrument?
400
When bonds are at this, coupon and current yield are equal.
What is Par?
400
This is the most prominent measure of general price changes. It measures the rate of increase or decrease in a range of consumer prices.
What is the consumer price index (CPI)?
400
Long put, short call
What is Bearish
400
When bonds are at this the current yield is less than the coupon.
What is at a premium?
500
The buyer of this has the right to buy (bullish); the seller of this has the obligation to sell (Bearish).
What is a call?
500
This is the relationship between bond prices and interest rates.
What is Inverse relationship?
500
Increases in industrial production, bullish stock markets, rising property values and increased consumer demand for goods and services would indicate this.
What is economic expansion?
500
This position sells stock at exercise.
What is bearish (long put, short call)?
500
When bonds are at this the current yield is greater than the nominal yield.
What is at a discount?
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