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Thursday, July 30, 2009

stock market/ financial terms

B

Ø Bonds:-

A bond is a debt security, similar to an I.O.U. When you purchase a bond, you are lending money to a government, municipality, corporation, federal agency or other entity known as the issuer. In return for the loan, the issuer promises to pay you a specified rate of interest during the life of the bond and to repay the face value of the bond (the principal) when it “matures,” or comes due.

C

Ø CANSLIM:-

CANSLIM is a philosophy of screening, purchasing, and selling common stock.

Developed by William O'Neil, the co-founder of Investor's Business Daily, it is

described in his highly recommended book "How to Make Money in Stocks".

Ø corporation:-

A corporation is an artificial legal entity (technically, a juristic person) which, while made up of a number of natural persons or other legal entities, has a separate legal identity from them. As a legal entity the corporation receives legal rights and duties

· joint sstock companies :-Investors and entrepreneurs often form joint stock companies and incorporate them to facilitate a business; as this form of business is now extremely prevalent, the term corporation is often used to refer specifically to such business corporations

· Municipal corporation:- Corporations may also be formed for local government

· Not-For-Profit Corporation:- political, religious, and charitable purposes

· Government owned corporation:- for government programs

Ø Capital market:-

The capital market is an important constituent of the financial system. It is a market for long-term funds –both equity and debt – and funds raised within and outside the company.

Ø CALL/NOTICE MONEY MARKET:-

It is far the most visible market as the day-to-day surplus funds, mostly of banks are traded there. The call money market accounts for the major part of the total turnover of the money market. It is a key segment of the Indian money market.

The call money market is a market for very short-term funds repayable on demand and with a maturity period varying between one day to a fortnight. When money is borrowed or lent for a day, it is known as call money. Intervening holidays and/or Sundays are excluded for this purpose. When money is borrowed or lent for more than a day up to 14 days, it is known as notice money. No collateral security is required to cover these transactions. The call money market is a highly liquid market, with the liquidity being exceeded only by cash. It is a highly risky and extremely volatile as well.

Ø COMMERCIAL PAPER:-

A commercial paper is an unsecured short-term promissory note, negotiable and transferable by endorsement and delivery with a fixed maturity period. It is a generally issued at a discount by the leading creditworthy and highly rated corporate. Depending upon the issuing company, a commercial paper is also known as finance paper, industrial paper, or corporate paper.

Ø Certificates of deposits :-

Certificates of deposits are time deposits of specific maturity similar to fixed deposits. The biggest difference between the two is that CDs, being in bearer form, are transferable and tradable while fixed deposits are not. Certificates of deposit are unsecured, negotiable, short-term instruments in bearer form, issued by commercial banks and development financial institutions. Certificates of deposit were introduced in June 1989.

F

Ø Financial market:-

According to Brigham, Eugene F, “The place where people and organizations wanting to borrow money are brought together with those having surplus funds is called a financial market.”

G

Ø Gilt-edged market:-

Gilt Edged Market’ also known as Government Securities Market is the market for Government and semi government securities. An important feature of the securities traded in this market is that they are stable in value and are much sought after by banks

M

Ø Money market:-

According to the Reserve Bank of India, a money market is “the centre for dealings, mainly of short-term character, in money assets; it meets the short-term requirements of borrowers and provides liquidity or cash to the lenders. It is the place where short-term surplus invisible funds at the disposal of financial institutions and individuals are bid by borrowers agents comprising institutions and individuals and also the government itself.” The instruments traded in the Indian money market are:Treasury bills (T-bills),Call/notice money market,Commercial paper (CP),Certificates of Deposits(CD)

Ø Mutual Funds:-

A mutual fund is a company that pools money from many investors and invests the money in stocks, bonds, short-term money-market instruments, or other securities

P

Ø Primary market:-

Primary market is a market for raising fresh capital in the form of shares and debentures. The primary market allows for the formation of capital in the country and the accelerated industrial and economic development.

Ø Public issue:-

when the securities are issued to the members of the general public, it takes the form of the Public issue. It is most popular method of raising long-term funds.

Ø Private placement:-

here the share of the body corporate are sold to a group of small investors, it take the form of ‘private placement’

R

Ø Rights issue:-

when the issue of equity shares of a body corporate is made to the existing shareholders as a pre-emptive right, it takes the form of ‘right issue’

Ø Retail investor:-

An individual who purchases small amounts of securities for him/herself, as opposed to an institutional investor. Also known as individual investor or small investor.

A private investor who buys shares through a stockbroker for his/her private portfolio.

S

Ø Secondary Market:-

A market, which deals in the securities that have been already issued by companies, is known as ‘the secondary market’. It is also called the stock or the share market.

Ø Security:-

A security is a fungible, negotiable interest representing financial value. Securities are broadly categorized into debt and equity securities. The company or other entity issuing the security is called the issuer.

Ø Stocks:-

In financial markets, stock is the capital raised by an organisation through the issuance and distribution of shares.A person or organization which holds shares of stocks is called a shareholder.

Stock is simply a portion of a company. By owning stock, you are a shareholder

Stocks are bought and sold on stock exchanges, such as the BSE & NSE.

T

Ø TREASURY BILLS:

Treasury bills are short-term instruments issued by the Reserve Bank on behalf of the government to tide over short-term liquidity shortfalls. This instrument is issued by the government to raise short-term funds to bridge seasonal or temporary gaps between its receipt and expenditure. They form the most important segment of the money market not only in India but all over the world as well.

Treasury bills are repaid at par on maturity. The difference between the amount paid by the tender at the time of purchase and the amount received on maturity represents the interest amount on T-bills and is known as the discount

Friday, July 24, 2009

Banking/financial abbreviations

AD - Authorised Dealer

ADR - American Depository Receipt

AFS - Available For Sale

AICCCA - Association of Independent Consumer Credit Counselling Agencies

AIFI - All-India Financial Institution

ALD - Aggregate Liabilities to the Depositor

ALM - Asset-Liability Management

AMC - Asset Management Company

AML - Anti-Money Laundering

ARC - Asset Reconstruction Company

ARCIL - Asset Reconstruction Company

(India) Ltd.

ATM - Automated Teller Machine

BCBS - Basel Committee on Banking

Supervision

BCP - Business Continuity Plans

BCSBI - Banking Codes and Standards

Boards of India

BFS - Board for Financial Supervision

BIFR - Board for Industrial and Financial

Reconstruction

BoP - Balance of Payments

BOS - Banking Ombudsman Scheme

BPLR- Benchmark Prime Lending Rate

BPSS - Board for Payment and Settlement

Systems

BR Act, 1949 Banking Regulation Act, 1949

BR Act(aACS), 1949 Banking Regulation Act, 1949 (as Applicable to Co-operative Societies)

BSE - Stock Exchange, Mumbai

BSR - Basic Statistical Return

CALCS - Capital Adequacy, Asset Quality,

Liquidity, Compliance and System

CAMELS - Capital Adequacy, Asset Quality, Management, Earnings, Liquidity,

Systems and Control

CBLO - Collateralised Borrowing and Lending Obligation

CBS - Core Banking Solutions

CCC - Credit Counselling Canada

CCCS - Consumer Credit Counselling Service

CCDM - Credit Counselling and Debt Management

CCIL - Clearing Corporation of India Ltd.

CCP - Central Counter Party

CCS - Co-operative Credit Society

CD - Certificate of Deposit

CDBMS - Central Data Base Management System

CDF - Co-operative Development Fund

CDR - Corporate Debt Restructuring

CDRM - Corporate Debt Restructuring Mechanism

CEO - Chief Executive Officer

CFMS - Centralised Funds Management System

CFS - Consolidated Financial Statements

CFT - Combating Financing of Terrorism

CGTSI - Credit Guarantee Trust for Small

Industries

CIBIL - Credit Information Bureau of India Limited

CLCC - Central Labour Co-ordination Committee

CLF - Collateralised Lending Facility

CMP - Conflict Management Policy

CP - Commercial Paper

CPOS - Central Point of Supervision

CPPAPS - Committee on Procedures and

Performance Audit on Public Services