Terms used in capital market authority, Finance Basics

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Terms used in Capital Market Authority

1. ACCOUNTS fourteen (14) days durations into that the stock exchange trading calendar is divided.

2. ACCOUNTS DAY - Sixth or seventh day given the expiry of an accounts period on that settlement on all time deals should be completed.

3. BACKWARDATION - Whereas stock cannot be delivered on settlement date even though it has been paid for, a third party is found who will lend and owns similar stock.  Like a security measure, this stock is paid for in complete.  While the original stock which could not be delivered on time is finally available, and the lender will be specified back his stock and will refund monies paid to him less backwardation that is a commission for the loan.

4. BONUS SHARES - Additional shares issued to shareholders on no additional cost to themselves as a form of further dividend. Identified as scrip issue also.

5. CALL-OVER - Bargaining and closing deals in a stock exchange with no a formal floor and position dealings, whereas the secretary reads, calls out each security to be dealt, individual at a time.

6. CARRY-OVER - When a deal has been efficient, for some valid reason, however either the Jobber may not be able to deliver stock on time or the buyer cannot pay on time.  In this case, a third party can be interacted to solve the problem.

7. CONTANGO - Is interest charged a client through his broker to cover the costs of borrowing money from a third party so like to pay for stock bought on his behalf? These occur when a client has commissioned his broker to purchase securities although for various reason, cannot pay on time.

 8. FLOOR loose term referring to the trading region of a stock exchange. Hence this encompasses all the places dealings or "markets" of the exchange.

9. GILT-EDGED SECURITIES - These are loan securities that are issued via Governments and since they are backed via the Governments "continuity", they are considered perfectly safe, providing usual periodic interest payments, and guaranteed capital redemption, a fixed rate of interest at the expiry of the loan term or Treasury bonds.

P.S.

Same type of securities issued via public corporations is identified bonds, whether they are issued via public companies they are identified debentures.


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