|Sale and Leaseback: The
sale of an asset which is immediately leased from
the new owner. Such a transaction helps to
increase short-term cash flow for the seller, and
can provide tax advantages.
|Sallie Mae-Student Loan
Marketing Association: A government-funded
agency that guarantees student loans, purchasing
them from financial institutions and selling them
on the secondary market.
|Sector: Stocks from one
particular industry. Stocks from firms in the
automotive industry are in the automotive sector,
for instance. Brokerage firms may specialize in
tracking particular sectors.
|Securities and Exchange
Commission (SEC): The government agency
responsible for monitoring the issuance and sale
|Security Interest: The
right to collateral in return for granting some
form of financing. A creditor has a security
interest in assets that have been pledged as
collateral on a loan.
|Secondary Offering: The
offering for sale of a large block of stock that
is not a new issue, but one that is held by a
large stock holder, usually a company founder, and
proceeds of the sale go to those holders, not the
issuing company. Such an offering is generally
sponsored or underwritten by an investment bank,
much in the same way as an IPO.
|Securities: A general term
for stocks, Bonds, an Certificates of Deposit.
|Securities Analyst: An
individual who does investment research and makes
recommendations to buy, sell, or hold. Most
analysts specialize in a single industry or
|Secured Creditor: A person
or business holding a claim against a debtor that
is secured with collateral or a lien on the
|Segment: A grouping of
customers within a market with similarities in
their purchasing needs or preferences.
|Self-liquidating Premium: A
premium paid in part or in full by the buyer.
Includes gimmicks offered on the side of cereal
|Senior Debt: Debt that must
be paid before subordinated debt, such as common
stock, can be paid. This is a consideration in
|Settlement: 1. Completing a
transaction by paying all obligations. 2. The
conclusion of a securities transaction; a
broker/dealer buying securities pays for them; a
selling broker delivers the securities to the
|Settlement Date (T+3): The
date specified for delivery of securities between
securities firms, usually three business days
after the execution of an order.
|Shakeout: The shutdown or
closing of several firms in an industry, leaving
only a few dominant players.
|Share: One unit of stock in
|Shareholder / Stockholder:
The owner of any number of shares of a companyís
|Shareholder of Record: The
name of an individual or entity that an issuer
carries on its books as the registered holder (not
necessarily the beneficial owner) of the issuer's
|Shark Repellent: Provisions
established by a corporation to discourage
unwanted takeover attempts by making it more
expensive and difficult to purchase the company.
|Short: Selling a stock or
option that you donít own (the broker lends it to
you and charges you interest). You hope the price
will go down so you can repay with cheaper stock,
keeping the difference as a profit.
|Short Position: A stock
purchase procedure that involves "borrowing"
shares of stock through a broker, selling them,
and repurchasing them when the price has dropped.
The buyer never actually takes possession of the
shares and can make a profit if the shares are
repurchased for less than what they were
"borrowed" for. However, if the stock price rises,
the buyer must pay to buy back the shares, thereby
|Short Sale Rule: A Nasdaq
rule that prohibits NASD members from selling a
Nasdaq National Market stock at or below the
inside best bid when that price is lower than the
previous inside best bid in that stock.
experienced from worker and customer shoplifting.
|Simple Interest: Interest
earned only on the initial capital investment.
Unlike compound interest, which continues to
accrue on both the capital and the earned
interest, simple interest only applies to the
|Smokestack Industry: Basic
manufacturing industries that have experienced
minimal growth during the past decades.
|Sovereign Risk: Risk that
lenders assume when making loans to foreign
governments due to the fact that a change in the
national power structure could cause the country
to default on its commitments.
|Specialist: A member of the
securities exchange responsible for executing
securities trades on a particular stock.
|Spin-off: Separating a
corporate division from the parent company and
establishing it as its own independent operating
|Split: Increasing the
number of shares outstanding without increasing
the shareowner's equity, causing a drop in the
share price proportional to the number of new
shares. Can be 2 for 1, 3 for 1,etc.
|Sponsor: A trader,
generally an institution or brokerage firm, whose
large scale purchases influence the purchases of
other traders. The demand for a stock can be
significantly affected by the actions of a
|Spread: The difference
between the bid and ask price.
Classification (SIC) codes: A numbering system
established by the U.S. Office of Management and
Budget that identifies companies by industry. It
is used to promote the comparability of economic
statistics from various sectors of the U.S.
|Strike Price: The option
price that, if a call, you can buy at, or if a
put, you may sell the security at.
|Stock: A security that
represents partial ownership of a corporation.
Stocks are referred to as equities.
|Stock Split: When a company
decides that they will issue multiple shares for
each old share. The stock price adjusts
proportionately Stock dividend-A dividend paid in
shares of stock instead of cash.
|Stock Option: The
opportunity to purchase shares of stock at a
specified price and within a specified time
|Stock Symbol: A unique
four- or five-letter symbol assigned to a Nasdaq
security, or a 1 to 3 letter designation for
stocks traded on the NYSE and American exchanges.
This is used for identifying it on stock tickers,
in newspapers, and on on-line services. If a fifth
letter appears, it identifies the issue as other
than a single issue of common or capital stock.
|Stop Order: An order given
to a broker to buy or sell a security when it
reaches a certain price.
|Stop Loss Order: An order
given to a broker to sell a security when it drops
to a certain price.
|Straight-Life Annuity: A
series of payments that continues only while the
recipient is alive.
A method of depreciating an asset by reducing its
value in equal amounts each year.
|Strategic Plan: A long-term
road map for a company, spelling out its financial
and operational objectives for the next 3-5 years.
|Strip: The practice of
dividing a bond into a series of lesser-valued
|Strong Dollar: When the
foreign exchange rate results in the U.S. dollar
being able to purchase foreign goods more cheaply.
Economic policy that supports reduction in taxes
as a means of improving the long-term growth of
|Support Level: Stock drops
to a point where institutional investors and
mutual funds see a bargain and start scooping up
shares, keeping the stock from dropping below that
|Sweepstakes: A type of
contest that encourages participants to purchase a
product in order to be considered for free prizes.
A lottery, which is illegal, requires a payment
for a game of chance. A sweepstakes offers an
alternative means of entry, eliminating the cost
|Syndicate: A group of
individuals who have formed a joint venture to
undertake a project they would have been unable to
|Synergy: A theory that
states that businesses or groups merged into a
large organization will be more productive and
successful than the businesses were individually;
the whole is greater than the sum of its parts.
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