What is a Distribution-in-Kind? Distribution-in-kind, also known as a distribution-in-specie, is a payment that is not made in cash. Instead, it is a payment that can be made in the form of physical goods or any other financial instrument that is not cash. For example, payment can be made using securities, such as stocks, dividends,…
What is an Efficient Frontier? An efficient frontier is a set of investment portfolios that are expected to provide the highest returns at a given level of risk. A portfolio is said to be efficient if there is no other portfolio that offers higher returns for a lower or equal amount of risk. Where portfolios…
What is Direct Market Access? Direct market access (DMA) refers to a method of electronic trading where investors can execute trades by directly interacting with an electronic order book. An order book is a list of orders that records the orders that buyers and sellers place in the stock exchange. The orders remain in the…
What is Debt Service? Debt service refers to the total cash required by a company or individual to pay back all debt obligations. To service debt, the interest and principal on loans and bonds must be paid on time. Businesses may need to repay bonds, term loans, or working capital loans. In some cases, lenders…
What is Economic Growth? Economic growth is a broad term that describes the process of increasing a country’s real gross domestic product (GDP). The growth can be measured as an expansion of real GDP or gross national product (GNP) over a given period. With an increase in GDP or otherwise, the value of goods and…
What is a Depository Transfer Check (DTC)? A depository transfer check (DTC), also known as a depository transfer draft, is used when a third-party service provider collects daily receipts from an organization’s locations and deposits it at a concentration bank. Since an organization may expand its business and operate in several locations, it is convenient…
How Can One Invest in the S&P 500 Index? The S&P 500 Index measures the stock performance of 500 large companies listed on U.S. stock exchanges. It is not a fund that investors can put their money in. However, portfolio management companies offer funds that replicate the index. They are called S&P 500 index funds….
What is the Ticker Symbol for the S&P 500 Index? The S&P 500 index, or Standard & Poor’s 500, is a very important index that tracks the performance of the stocks of 500 large-cap companies in the U.S. The ticker symbol for the S&P 500 index is ^GSPC. The series of letters represents the performance…
