Portfolio:
All taxable and tax-deferred investment accounts and their
contents (appreciating & income producing assets).
More broadly, your portfolio holds all your investments.
Position Trading:
An investing strategy in which open positions are held for
an extended period of time. Usually six months to a year
or more.
Position:
The combined total of an investor's open option contracts
(calls and/or puts) and long or short stock. It is an
investor's stake in a particular security or market.
Precious Metals Equities:
Mutual fund investing primarily in stocks of companies who
mine precious metals, such as gold, silver, platinum, etc.
The stock prices of these companies can also reflect the
rising or falling values of the precious metals that the
company mines. Participating Preferred Stock allows its
owners to share in profits beyond the declared dividend.
Convertible preferred stock allows the owner to exchange
this stock for a number of common shares.
Preferred Stock:
Stock that pays dividends at a stated rate and has
priority over common stock in dividend payments and asset
liquidation. Preferred stock does not ordinarily carry
voting rights.
Premium:
Total price of an option: intrinsic value plus time value.
Often (erroneously) this word is used to mean the same as
time value.
Price (52-Week high and 52-Week Low):
The highest and lowest trade prices achieved during the past
52 weeks. Note: Compare current price to the 52-week high or
52-week low to get an estimate of where the stock is trading
in its year range.
Price/Book Ratio:
The latest price per share divided by the last fiscal year
net asset value (book value) per share, for a given
corporation. Used by analysts to determine whether a stock
is undervalued or overvalued.
Price/Earnings (P/E) Ratio:
The most commonly used measure of value for both markets and
individual stocks. It indicates how many times earnings an
investor is willing to pay to own a stock or market index,
therefore it is sometimes called the multiple. A trailing
P/E is the current price divided by the latest fiscal years
reported earnings per share. While a forward P/E uses an
analysts forecast of next years earnings in the ratio.
Primary Market:
Also called New Issue Market, it is the market for new
issues of securities where the proceeds of sales go to the
issuer of the securities.
Prime Rate:
Interest rate that commercial banks charge their most credit
worthy customers, such as corporations. This is a useful
measure for current lending rates, as most banks charge a
few points above prime on mortgages, personal loans, and
other less credit worthy customers.
Principal Amount:
The original amount or face value of a investment, typically
bonds and CDs, on which interest is earned. Interest is paid
based on a percent of the principal (a stated interest or
coupon rate). At maturity, the entire principal is returned
to investor; however its purchasing value may be diminished
by inflation.
Principal Transaction:
A transaction, in which the brokerage firm buys or sells a
security into or out of its own account. Commission is not
charged for principal transactions. Instead the transaction
is marked up or down before it is entered to the customer's
account. See also BROKER/DEALER.
Proceeds:
The amount of money a shareholder receives from a sale of
stock minus a broker's commission. Also the money credited
to a borrower less costs and fees.
Profit Margin %:
The last fiscal year net income divided by the last fiscal
year's sales or revenues for a given corporation.
Prospectus:
A formal written offer to sell securities that states the
price of the new issue, delivery date, relative financial
information, business history of the company as well as
other information that can help the investor make an
informed decision. It must be given to every investor who
purchases a newly issued security.
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