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A B C D E F G H I J K L M N O P Q R S T U V W X Y Z #

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Cage - A back office area of a brokerage firm in which funds are received and disbursed.
Callability - The feature of a bond whereby the corporation that has issued it can redeem the bond before it matures. Corporations may call their bonds when interest rates drop below their current bond rates. They may then replace high-yielding bonds with lower-yielding bonds. Call provisions must be made clear before a bond is issued. These provisions include the call price, which is the price at which the bond will be sold back to bondholders. The call price is usually above par. The company must also include dates on which it can legally begin to order its bonds redeemed.
Callable - A securities feature that allows the issuer to retire the issue when desired. 
Callable Bonds - Treasury bonds that can be redeemed by Uncle Sam five years before maturity.
Callable Securities - Preferred stocks or bonds which may be redeemed before maturity, at the option of the issuer.
Call Date - The date on which and after which selected issues of Treasury bonds can be redeemed before maturity.
Call Feature - The terms of the bond contract giving the issuer the right or requiring the issuer to redeem or "call" all or a portion of an outstanding issue of bonds prior to their stated dates of maturity at a specified price, usually at or above par.
Call Protection - The degree of security that an investor has against a bond being redeemed. Practically, the number of years between today and the call date.
Canceled Order - A buy or sell order that is canceled before it has been executed. In most cases, a Limit Order can be can be canceled at any time as long as it has not been executed. A Market Order may only be canceled if the order is placed after market hours and is then canceled before the market opens the following day.
Capital - 1) The total amount of money invested in a firm. 2) Money accumulated and available to be used to produce more money.
Capital Appreciation - The growth of the earnings on an investment's principals.
Capital Expenditures - The amount used during a particular period to acquire long-term assets such as property, plant, or equipment.
Capital Gain - A trading profit. Trading gains that occur in one year or less are short-term capital gains; those that occur in periods longer than one year are long-term capital gains. Short-term and long-term capital gains are treated differently for tax purposes.
Capital Gain Distribution - Payment to mutual fund clients consisting of profits from the sale of stocks and bonds.
Capital Growth - The amount an investment increases in value when either its price rises or its profits are reinvested.
Capitalization - The total dollar value of all common stock, preferred stock, and bonds issued by a corporation.
Capital Loss - A trading loss. Losses are long- or short-term as are gains. See Capital Gain.
Capital Market - There are two broad types of securities traded in the capital market: debt and equity. Buying stock allows investors to gain an equity interest in the company and become part owner. When investors buy bonds, they essentially loan money to the company or government that issued the bond and become creditors of that issuer.
Capital Preservation - Objective generally, of money market and bond funds which seek to maintain a level of principal stability. Money market funds seek to preserve capital by being managed to maintain a stable $1.00 share price; bond funds have fluctuating share prices but may be invested with the objective of seeking to preserve principal. Capital preservation is never guaranteed.
Capital Stock - The common and preferred stock of a company.
Captive Agent - An insurance agent who represents only one insurance company. Captive agents can offer the investor personal service, but are unlikely to inform you of a full range of insurance options.
Cash - Coins and currency which is readily available.
Cash Account - A customer account in which all securities purchased must be paid for in full.
Cash and Equivalents - The value of assets that can be converted into cash immediately, as reported by a company. Usually includes bank accounts and marketable securities, such as government bonds and banker's acceptances.
Cash Dividend - Dividends that corporations pay on a per-share basis to stockholders from their earnings.
Cash Flow - Amount of total payments, interest and occasionally principal received as current income from Treasury and agency securities.
Cashiering Department - Brokerage firm department that is responsible for receiving and delivering securities and money to and from other firms and clients.
Cash Price - Price required for immediate settlement. The term "cash" or "spot" is used to differentiate from a futures transaction, where settlement is due at a predetermined time in the future. Also called "spot price."
Cash Transaction - A settlement on the same day as the trade date.
Cash Value - The amount of money allowed to be withdrawn from a whole life insurance policy and still retain coverage. The amount of cash value differs widely among policies.
CD - See Certificate of Deposit.
CD Rate - The current interest rate for a given CD (certificate of deposit).
CDSC - Contingent Deferred Sales Charge. Mutual fund fee structure providing for a sales charge to be paid at the time of redemption of fund shares at a rate based on the client's length of ownership. Typically, the charge is imposed on a declining scale in the investor's first 5 - 6 years of ownership.
Certificate - The physical document evidencing ownership (a share of stock) or debt (a bond).
Certificate of Deposit (CD) - A negotiable certificate that evidences a time deposit of funds with a bank.
Certificate Shares - Physically issued documents held by a client (mutual funds will issue certificates only at the request of the client) indicating ownership of a specific number of shares of stock.
Certified Check - Negotiable instrument indicating payment is guaranteed by a bank. Funds are immediately withdrawn from a depositor's account and it becomes the legal obligation of the bank to cover the check.
Changes in Financial Position - Sources of funds internally provided from operations that alter a company's cash flow position: depreciation, deferred taxes, other sources, and capital expenditures.
Charter - Generic term synonymous with a fund's Articles of Incorporation or Agreement and Declaration of Trust, as applicable.
Chicago Board Options Exchange (CBOE) - Listed option trading was originated by this marketplace on April 26, 1973.
Chicago Board of Trade (CBT) - A major commodity exchange located 141 East Jackson Boulevard, Chicago IL.
Chicago Mercantile Exchange - Trades futures and futures options.
Churning - The excessive trading of a client's account in order to increase the broker's revenues from commissions.
Circuit Breakers - Procedures established to forestall the market from spiraling down. Circuit breakers will "kick-in" when the market has dropped by a specific amount within a certain period. At that time, the major stock and commodities exchanges will temporarily stop trading in stocks and stock index futures to give floor traders time to rebalance buy and sell orders. Circuit breakers were introduced in 1987 after Black Monday. 
Class A shares - Mutual fund shares are generally divided into three groupings, called Class A, Class B, and Class C shares, each with varying fees and sales charges. In most cases, Class A shares will have no redemption fee (contingent deferred sales charge).
Classified Stock - Separation of equity into more than one class of common, usually designated in 2 classes as Class A and Class B. The distinguishing features set forth in the corporation charter and bylaws usually give an advantage to the Class A shares in terms of voting power, though dividend and liquidation privileges can also be involved.
Clearing Corporations - A central reception and distribution center operated for its members who are made up of various brokerage firms. Many offer automated systems that expedite comparison procedures. Among these are NSCC (National Securities Clearing Corp.) and OCC (Options Clearing Corporation).
Clearing House - Organization handling the processing of securities that are purchased or sold by members of an exchange.
Clearing House Comparison (CHC) - A form used to submit trades to NSCC that have missed the normal entry methods. Such trades enter the system on the third business day of the trade cycle.
Client (Account) Statement - Sometimes referred to as month-end statement. This is a statement of the client's positions and activity. It must be sent out quarterly, but if there is monthly activity in the account, it is sent out monthly.
Cliffing - A strategy for arranging bonds so that they all mature in the same year.
Close - Price of the last transaction of a security on a particular trading day.
Closed End Fund - A fund whose offering of shares is closed. That is, once the initial offering is completed, the fund stops offering its shares. The value of the shares is then determined by supply and demand, rather than by calculation of net asset value.
Closed-End Investment Company - Management investment company that will issue a fixed number of shares for sale and can issue senior securities too. The shares may be of several classes. Shares are bought and sold in the secondary marketplace; the fund does not offer to redeem shares. The market price of the shares is determined by supply and demand and not by their net asset value. The shares may be traded on an exchange or over-the-counter market.
Collateral - An asset pledged to support a loan.
Collateralized Mortgage Obligation (CMO) - A mortgage-backed bond that separates mortgage pools into different maturity classes called tranches. This is accomplished by applying income (payments of principal and interest) from mortgages in the pool in the order the CMO's pay out.
Collateral Trust Bond - A debt instrument issued by one corporation and backed by the securities of another corporation.
Collection Period - Time required for an investment check to clear the account on which it was drawn. Also called check clearing.
COMEX - Commodity Exchange Incorporated. New York center where members trade futures in aluminum, copper, gold, silver and futures options in copper, gold and silver.
Commercial Bank - State or nationally chartered lending institution owned by stockholders offering services such as demand deposits and short-term business loans.
Commercial Paper - A short-term debt instrument issued by corporations. Its rate of interest is set at issuance and can be realized only if held to maturity.
Commission - The amount charged by a firm on an agency transaction.
Commission House Broker - A floor broker who is employed by a brokerage house to execute orders on the exchange floor for the firm and its customers.
Committee on Uniform Security Identification Procedure (CUSIP) - An interindustry security coding service. Each type of security has its own unique CUSIP number.
Commodities - Bulk goods such as grains, metals, and foods traded on a commodities exchange or on the spot market.
Common Stock - A security, issued in shares, that represents ownership of a corporation. Common stockholders may vote for the management and receive dividends after all other obligations of the corporation are satisfied.
Community Property - Property and income jointly belonging to a married couple. Each have equal rights to the assets. A legal relationship created by operation of state law.
Comparison - The process by which two contra brokerage firms in a trade agree to the terms of the transaction. Comparison can be either through a clearing corporation or on a trade-for-trade basis (that is, ex the clearing corporation).
Competitive Tender  - A method of purchasing new issues of Treasury bills, notes, and bonds in which the investor specifies the yield, and accordingly the price, he or she requires to purchase the security.
Compound Interest - Interest earned on or assessed against, both an original investment and the interest already accrued. When interest is compounded, the value of an investment can increase dramatically over long periods of time. By the same token, if an individual fails to keep up with a loan's interest payments, the total amount one has to repay increases in the same way.
Comprehensive Insurance - Insurance that pays for any damage to your property that's not your fault. Comprehensive insurance typically covers fire, theft and vandalism.
Confidence Indicator - A measure of investors' faith in the economy and the securities market. A low or deteriorating level of confidence is considered by many technical analysts as a bearish sign.
Confidence Level - The degree of assurance that a specified failure rate is not exceeded.
Confirmation - A trade notice, issued to customers of brokerage firms, that serves as written notice of the trade, giving price, security description, settlement money, trade and settlement dates, plus other pertinent information.
Consent to Loan Agreement - An agreement margin customers must sign to authorize the brokerage firm to lend the customer’s securities to itself or other firms.
Consideration - The money value of a transaction (number of shares multiplied by the price) before adding commission.
Constant-Dollar Investment - Securities such as savings accounts and money market funds that do not fluctuate in price.
Consumer Price Index (CPI) - A measure of price changes in consumer goods--also known as the "cost of living index." The index is calculated monthly by the US Bureau of Labor Statistics. Some CPI components are food, housing costs and transportation.
Contingent Deferred Sales Charge - A pricing structure that imposes a sales charge when investors exit a mutual fund.
Contractual Plan - A type of accumulation plan in which an investor in mutual funds makes a firm commitment to invest a given amount of money over a given time.
Control Persons - A director, officer or other affiliate of the issuer or a stockholder who owns at least 10% of any class of outstanding stock.
Control Securities - Securities owned by one of those parties mentioned in Control Person.
Conversion Ratio and Price - The number of shares of common stock into which a bond or a preferred stock can be converted is the conversion ratio. The conversion price indicates the stated value per share at which the common stock will be delivered to the investor in exchange for the convertible.
Convertibility - The degree of existing freedom to exchange a currency without restrictions or controls imposed by the government.
Convertible Issue (Bond) - A securities feature that permits the issue holder to convert to another issue, usually common stock. This privilege can be used only once. The preferred stock or bond holder can convert from that issue to another, but not back.
Convertible Preferred Stock - A preferred stock that may be converted into common stock of the same company at specific prices or rates.
Convertible Security - A security that can be exchanged for common stock at the option of the security holder for a specified price or rate. Examples include convertible bonds and convertible preferred stock.
Convertible Zero - As it applies to the Treasury sector, a stripped Treasury zero that converts into a current income obligation five years before maturity.
Convexity - A mathematical concept that measures the sensitivity of the market price of interest-bearing bonds to changes in interest rate levels. 
Cooling-Off Period - The period, usually 20 days, between the filing of the registration statement on a new issue with the SEC and the effective date of the offering.
Co-Partnership Account - An account in which the individuals may act on behalf of the partnership as a whole.
Co-Payment - The amount, either a percentage or a fixed fee, which an individual has to pay for a service otherwise covered by their insurance policy. A kind of deductible "co-payment" is the term generally associated with health insurance.
Corner a Market - To purchase enough of the available supply of a commodity or stock in order to manipulate its price.
Corporate Bond - Debt obligations issued by corporations as an alternative to offering equity ownership by issuing stock. Like most municipal bonds and Treasuries, most corporate bonds pay semi-annual interest and promise to return their principal when they mature. Maturities range from 1 to 30 years.
Corporate Bond Funds - Invest primarily in debt obligations of companies and provide investors with monthly income that is fully taxable.
Corporate Resolution - A document stating that the corporation’s board of directors has authorized a particular individual to act on behalf of the corporation. This document is necessary when the corporation opens a cash or margin account.
Corporate Retirement Plans - Programs like the Money Purchase Pension and Profit Sharing Plans which provide employee benefits after retirement and are based on employer contributions.
Corporation - A business organization under the law with certain rights and responsibilities in which the worth is divided into shares of stock.
Correlation Measures - Measures that show the validity of a comparison to a benchmark index based on the historical relationship between portfolio returns and index returns.
Cost Basis - Original purchase price or appraised value of an asset used in determining capital gains.
Coupon - (1) On Bearer Stocks, the detachable part of the certificate exchangeable for dividends. (2) Denotes the rate of interest on a fixed interest security - a 10% coupon pays interest of 10% a year on the nominal value of the stock.
Coupon Bond - Security issued with small detachable certificates entitling the holder to the interest due. Also known as Bearer Bond.
Coupon Interest - Money paid to the holder of a coupon bond.
Coupon Rate - The term is used colloquially to refer to a security's interest rate.
Coupon Yield - Also called nominal yield. A bond’s coupon payment divided by par value.
Cover - The total net profit a company has available for distribution as dividend, divided by the amount actually paid gives the number of times that the dividend is covered.
Covered Call - A call option that is sold against stock owned by the writer of the call.
Covered Put - A put option that is sold by the owner of a put of the same class with an equal or longer expiration date and an equal or higher exercise price.
CPI (Consumer Price Index)  - Outlines the conditions of credit arrangement between the broker and customer concerning a margin account.
Credit Agreement - Outlines the conditions of the credit arrangement between the broker and the client concerning a margin account.
Credit Balance - 1: In a client's cash account at a brokerage firm, the amount that the firm owes to the client. This equals money deposited and remaining after any purchases are paid, plus uninvested proceeds from securities sold and not sent to the client. 2: In a client's margin account at a brokerage firm a credit balance may mean either: * Proceeds from short sales that are held in escrow for the securities borrowed for these sales, plus the required margin for the trade. * Any free credit balances, or net balances, which can be withdrawn at any time. A free credit balance occurs when all previously margined securities have been paid for in full. Special miscellaneous account (SMA) balances are not free credit balances. If money is withdrawn, a new or increased debit balance will be incurred. SMA is generated from the borrowing power of margin securities within the client's account
Credit Rating - Assessment of an individual's or corporation's credit history and ability to pay its obligations. There are several firms that investigate, analyze, and maintain records on the credit status of individuals and businesses--for example, Equifax for individuals, and Dun & Bradstreet for commercial firms. Standard & Poor's and Moody's assign ratings to bonds. In rating the bonds, credit worthiness is an important factor.
Credit Risk - Failure of an issuer to make timely interest or principal payments, or a decline or perception of a decline in the credit quality of a bond, can cause a bond's price to fall, potentially lowering the fund's share price.
Credit Spread - Also called quality spread, the difference in yield between higher-quality issues (such as Treasury securities) and lower-quality issues. Normally, lower-quality issues provide higher yields to compensate investors for the additional credit risk.
Cumulative Performance - Total performance return on a fund to date.
Cumulative Preferred - A preferred stock feature that entitles the holder to the later payment of dividends that were not paid when due. The dividends are, in this sense, "cumulative." The dividends accumulate and must be paid (along with present dividends) before common stockholders may receive any dividends.
Cumulative Returns - Total performance return on a product to date.
Currency Hedging - A technique used to offset the risks associated with the changing value of currency.
Currency  Risk - The risk that shifts in foreign exchange rates may undermine the dollar value of overseas investments.
Current Assets - Value of cash, inventories, marketable securities, and accounts payable available for conversion into cash in less than one year.
Current Income - Cash-in-hand payments received from interest and dividends.
Current Liabilities - The amount owed for salaries, accounts payable, interests, and other debts due within one year.
Current Maturity - The number of years until a bond matures, regardless of its original maturity when issued.
Current P/E Ratio - The ratio of current price divided by last two quarters earnings per share (EPS) plus next two estimated quarters EPS. See Price/Earnings Ratio.
Current Portion of Long-Term Debt - A numerical term on an income statement that represents the original long-term bonds and other loans of a company that come due during the next year.
Current Year High & Low Prices - The highest and lowest price for a given bond during the current calendar year
Current Yield - A bond’s coupon payment divided by its market price.
CUSIP (The Committee on Uniform Security Identification Procedure) - An inter-industry security coding service. Each type of security has its own unique CUSIP number.
CUSIP Number - An industry code which uniquely identifies nearly all traded stocks and bonds.
Custodian - The person or institution responsible for protecting the property of another.
Custodian for a Minor - Appointed legal representative acting in the interest of a minor under the Uniform Transfers to Minors Act (UTMA) or the Uniform Gifts to Minors Act (UGMA).
Customer (Account) Statement - Sometimes referred to as month-end statement. This is a statement of the customer’s positions and activity. It must be sent out quarterly, but if there is monthly activity in the account, it is sent out monthly.
Cyclical Industries - Industries where earnings tend to rise quickly when the economy strengthens and fall quickly when the economy weakens. Examples of cyclical industries include housing, automobiles and paper. Noncyclical industries are typically less sensitive to changes in the economy. These include utilities, grocery stores and pharmaceutical companies.
Cyclical Stocks - Stocks within industries where earnings tend to rise quickly when the economy strengthens and fall quickly when the economy weakens. Examples of cyclical stocks include housing, automobile, and paper companies. Noncyclical or defensive stocks are typically less sensitive to changes in the economy. These include utilities, grocery stores and pharmaceutical companies.