What is a Margin Account? A margin account refers to a type of brokerage account that investors use where they can borrow funds to purchase financial products. Investors are required to pay a monthly interest rate on the amount borrowed from the brokerage. A margin-approved account increases the customer’s power to purchase more securities, such…
What is a Stalking-Horse Bid? In bankruptcy cases, a stalking-horse bid refers to a deal with a potential buyer that is hidden from the public, creditors, and the courts. Usually, when a company is preparing to file bankruptcy, it chooses an entity from a pool of interested bidders to make the first bid to buy…
What is the Spot Exchange Rate? The spot exchange rate is the current amount one currency will trade for another currency at a specific point in time. It is the open market price that a trader will pay to buy another currency. Generally, the spot exchange rates are regulated by the global foreign exchange market,…
What is Spider (SPDR)? Spider (SPDR), also pronounced and written as Spyder, refers to the Standard and Poor’s Depositary Receipts. It is also the trademark of Standard and Poor’s Financial Services LLC, a subsidiary of Standard & Poor’s (S&P) global owned by State Street Global Advisor (SSGA). SPDR belongs to a family of exchange-traded funds…
What is the Spillover Effect? Spillover effect can refer to a positive or a negative economic, social or political impact, but more often negative, that is experienced in one region or across the world due to an independent event occurring from a seemingly unrelated event. More often, the event occurs in a specific country, leading…
What is Spinning Top Candlestick? Spinning top candlestick is a pattern with a short body between an upper and a lower long wick. The spinning top illustrates a scenario where neither the seller nor the buyer has gained. It results in equal opening and closing price units. The formation of a spinning top candlestick helps…
What is Communism? Communism is a social, political, and economic ideology in which the means of production are owned communally, and it advocates for a classless society with little or no private ownership of property. The Communist theory was founded by German political philosophers and economists Karl Marx and Friedrich Engels in the second half…
What is Margin? The term “margin” refers to the amount deposited with a brokerage when borrowing money to buy securities. When an investor buys securities on margin, it means they are using borrowed money from the brokerage to invest in securities. In such a case, the broker acts as the lender; the investor acts as…
What is a Phantom Stock Plan? A phantom stock plan, also called a shadow stock plan, is a type of deferred employee compensation plan where the type of shares issued to plan participants are phantom shares instead of company shares. Phantom shares provide benefits similar to stock ownership but without actually issuing company shares. What…
What is Opaque Pricing? Opaque pricing or a non-transparent price refers to the pricing method for goods and services whose brand and/or detailed quality information is hidden during the sale process. It is targeted to consumers who make purchases primarily based on price and not on brand reputation or detailed product/service quality information. How Opaque…
