Shared Flashcard Set

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Investments test 1
Chapter 2
14
Business
Undergraduate 4
10/15/2013

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Cards

Term
Major classes of financial assets or securities
Definition
Money market, Bond Market, equity securities, indexes, derivative markets
Term
The Money Market
Definition
Treasury bills
Certificates of Deposits
Commercial Paper
Bankers Acceptances
Term
Treasury bills
Definition
Bid and asked price
Bank discount method
Term
The Bond Market
Definition
Treasury Notes and Bonds
Inflation-Protected Treasury Bonds
Federal Agency Debt
International Bonds
Municipal Bonds
Corporate Bonds
Mortgages and Mortgage-Backed Securities
Term
Treasury Notes
Definition
maturities up to 10 years
Term
Treasury Bonds
Definition
maturities in excess of 10 year
Term
Quotes
Definition
percentage of par
Term
Municipal Bonds
Definition
Issued by state and local government, no tazes
Term
Corporate Bonds
Definition
Issued by private firms
Semi-annual interest payments
Subject to larger default risk than government securities
Term
Options
Definition
Callable
Convertable
Term
Common stock
Definition
Residual claim
Limited liability
Term
Preferred stock
Definition
Fixed dividends -limited
Priority over common
Tax treatment
Term
Dow Jones
Definition
Includes 30 large blue-chip corporations
Computed since 1896
Price-weighted average
Term
Standard & Poor’s
Definition
Broadly based index of 500 firms
Market-value-weighted index
Index funds
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