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Ask price-Bid Price
NYSE members who execute customer orders to buy and sell stock transmitted to the exchange floor.
A bonds annual coupon divided by its price. It's a measure of the
market's expectations of future interest rates given the current market
conditions
Stockholder
---Arbitrary cutoff ---Ignores cash flows beyond cutoff---Biased against long-term
matches buyers and sellers for fee
issuer has right to end early
The process of determining the present value of a payment or a stream of payments that is to be received in the future.
---Easy to understand /compute---Biased toward liquidity---Includes time value of money
-V0 Increases as --d1 increases --g increases --r decreases- Price grows by a factor of g every year
convert bond to stock
The corporation continues in existence and is not dependent on the lives of its owners
More difficult to compute
Issuer ---> Investor
Owning trading license
Issuer doesn't pay if catastrophe occurs
a corporation's first offer to sell stock to the public
The ability of an asset to generate earnings, which are then reinvested in order to generate their own earnings.
Members who are dealers for a particular security
Members who execute orders for busy commission brokers for a fee
---Ignores time value of money---Arbitrary cutoff ---Ignores cash flows beyond cutoff---Biased against long-term
brokers that execute orders for members or nonmember firms
Voting RightsProxy voting- right to vote for someone elseClasses of
stocks-proportion of shared dividends-proportion of assets in
liquidation-Preemptive right to new issue
Informal network of brokers that negotiate dealsDealers buy and sell
from their own inventoryGovernment securities are traded OTC
Interest that accrues on the initial principal and the accumulated interest of a principal deposit, loan or debt.
broker that works for particular member firm
risk free
Payment depends on income
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