What is a Depository? A Depository refers to a place or entity that holds financial securities in a dematerialized form. A bank, organization, or any institution holding and assisting in security trading is referred to as a depository. Depository accounts hold securities in the same way that bank accounts hold funds. A depository can also…
What are Dependent Care Benefits? Dependent care benefits are the benefits offered by employers to employees for taking care of dependents, such as disabled members of the family and young children. Dependent care benefits include dependent care tax credits, paid leave for the care of dependents, and flexible spending accounts for dependent care. …
What is a Dependent? Dependent is a term used for a person who relies on a tax filer for financial support and enables the tax filer to claim dependent care tax benefits on the annual tax return. The Internal Revenue Code (IRC) determines the eligibility criteria for a person to be considered a dependent of…
What is a Deposit? Deposit is a term used to denote the money kept or held in any bank account, especially to accumulate interest. The fund used as a security to get the goods delivered can also be called a deposit. Any transaction processed to transfer money to an entity for safeguarding can be referred…
What is Hotelling’s Theory? Hotelling’s theory proposes that the only time holders of nonrenewable resources should produce their commodities is when the revenue generated from them can exceed that from other financial instruments. Also known as Hotelling’s rule, the theory makes several assumptions. First, that markets are efficient. Second, that owners of the respective resources…
What is a Hostile Takeover Bid? A hostile takeover bid is the acquisition of a target company, but one that takes place against the board of directors’ consent. Ideally, an entity interested in a publicly-traded company should seek approval from the respective company’s board of directors. But if the board rejects the acquisition…
What is Homemade Leverage? Homemade leverage is a financial concept that holds that as long as investors borrow on the same terms as the company, they can artificially duplicate the effects of corporate leverage. Investors use the idea to recreate a leverage scenario using a portion of their investments. The argument works under…
What is a Homeowner’s Association (HOA)? A homeowner’s association (HOA) is a private organization formed by property developers to establish and enforce internal regulation that controls land use. It is sometimes referred to as Properties Owners Association (POA) and may also engage in such activities as marketing and selling of properties on behalf of its…
What are Homemade Dividends? Homemade dividends refer to a form of investment income that investors generate from the sale of a percentage of their equity portfolio. The investor fulfills his cash flow objectives by selling a portion of shares in his portfolio instead of waiting for the traditional dividends. Usually, if a shareholder needs some…
What is Quality of Security? Selecting the right quality of security is one of the most important factors to consider in investing. Security refers to a negotiable financial instrument that holds monetary value and represents an ownership stake in a publicly traded corporation, either through stocks, bonds, or options. The security ownership may be represented…
