Shared Flashcard Set

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Investments
Chapter 4
17
Finance
Undergraduate 4
10/31/2012

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Cards

Term
Primary market
Definition
The market for new issues of securities, typically involving investment bankers
Term
Initial Public Offerings (IPOs)
Definition
Common stock shares of a company being sold for the first time
Term
Investment bankers
Definition
Firm specializing in the sale of new securities to the public, typically by underwriting the issue
Term
Underwrite
Definition
The process by which investment bankers purchase an issue of securities from a firm and resell it to the public
Term
Prospectus
Definition
Provides info about an IPO of securities to potential buyers
Term
Listed securities
Definition
The securities of companies meeting specified requirements of exchanges and marketplaces
Term
NYSE
Definition
New York Stock Exchange; the major secondary market for the trading of equity securities
Term
Blocks
Definition
Transactions involving at least 10,000 shares
Term
Program Trading
Definition
Involves the use of computer-generated orders to buy and sell securities based on arbitrage opportunities between common stocks and index futures and options
Term
Nasdaq Stock Market
Definition
A US electronic equity securities market
Term
Market Makers (dealers)
Definition
An individual (firm) who makes a market in a stock by buying from and selling to investors
Term
Electronic Communication Networks (ECN)
Definition
A computerized trading network that matches buy and sell orders
Term
Instinet (Institutional Network)
Definition
An electronic trading network
Term
Dow Jones Industrial Average (DJIA)
Definition
A PRICE-WEIGHTED series of 30 leading industrial stocks used as a measure of stock market activity
Term
Blue Chip stocks
Definition
Stocks with long records of earnings and dividends---well known, stable, mature companies
Term
S&P 500
Definition
Standard and Poor's 500 composite Index; CAPITALIZATION-WEIGHTED index of stock market activity covering 500 stocks
Term
EAFE Index
Definition
The Europe, Australia, and Far East Index, a VALUE-WEIGHTED index of the equity performance of major foreign markets
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