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Technical Analysis to Zero Coupon
Technical
analysis. An
approach to market analysis that attempts to forecast price
movements by examining and charting the patterns formed by
past movements in prices, trading volume, the ratio of advancing
to declining stocks and other statistics. For contrast, see
fundamental analysis.
Tender offer.
An offer to shareholders to buy their shares of stock in a
company. Tender offers are usually a key element of a strategy
to take over, or buy out, a company and thus are usually made
at a higher-than-market price to encourage shareholders to
accept them.
10-K.
A detailed financial report that must be filed by a firm each
year with the Securities and Exchange Commission. It is much
more detailed than a typical annual report published and sent
to shareholders.
Total return.
A measure of investment performance that starts with price
changes, then adds in the results of reinvesting all earnings,
such as interest or dividends, generated by the investment
during the period being measured.
Triple witching
hour. A phrase
made popular by program trading, it is the last hour of stock
market trading on the third Friday of March, June, September
and December. That's when options and futures contracts
expire on market indexes used by program traders to hedge
their positions in stocks. The simultaneous expirations often
set off heavy buying and selling of options, futures and the
underlying stocks themselves, thus creating the "triple"
witching hour.
12b-1 fees.
An extra fee charged by some mutual funds to cover the costs
of promotion and marketing. In practice, 12b-1 fees are often
used to compensate brokers for selling low-load and no-load
funds. The effect of the fee is reflected in the performance
figures reported by the funds.
Yield.
In general, the return earned by an investment. In discussing
bonds, yield can be any of several kinds. "Coupon yield"
is the interest rate paid on the face value of the bond, which
is usually $1,000. "Current yield" is the interest
rate bas ed on the actual purchase price of the bond, which
may be higher or lower than the face amount. "Yield to
maturity" is the rate that takes into account the current
yield and the difference between the purchase price and the
face value, with the difference assumed to be paid in equal
installments over the remaining life of the bond.
Zero-coupon
bond. A bond
that pays all its interest at maturity but none prior to maturity.
These "zeros" sell at a deep discount to face value
and are especially suitable for long-term investment goals
with a definite time horizon, such as college tuition or retirement.
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