What is Max Pain (Options)? Max pain is a situation in which the stock price locks in on an option strike price as it nears expiration, which would cause financial losses for the highest possible number of options traders. It attempts to explain how, during the last days, the underlying stock prices often cluster around…
What is a Mature Industry? A mature industry is an industry that has passed the introduction stage, growth stage, and shake out stage, but has not yet reached the declining stage. A mature industry is a stage in the industry life cycle that includes five stages – introduction, growth, shakeout, maturity, and decline – and…
What is a Medallion Signature Guarantee? A medallion signature guarantee is a certification stamp that lenders – such as banks and other financial institutions – provide to allow investors to transfer ownership of securities. It will generally be required by parties when the owner intends to transfer securities. The medallion signature guarantee protects…
What is Melt Up? Melt up is a financial term that refers to a sharp improvement in the performance of the stock market due to reasons other than fundamental improvements in the economy. The improvement in investment performance is mainly driven by investor sentiment, where investors flock into buying stocks because they notice the market…
What is Mental Accounting? The mental accounting concept was introduced by Richard Thaler in a paper titled “Mental Accounting Matters,” which was published in the Journal of Behavioral Decision Making. Thaler noted that people place the value of money differently, and it exposes them to irrational decision-making. In simple terms, the concept states that individuals…
What is MasterCard? MasterCard is a technology firm in the global electronic payment industry responsible for processing electronic payments, through its full range of payment programs and services. It partners with various institutions worldwide to connect different participants in various types of transactions, including businesses, financial institutions, merchants, and consumers using its branded electronic payment…
What is Dragonfly Doji Candlestick? A dragonfly doji candlestick is a candlestick pattern with the open, close, and high prices of an asset at the same level. A dragonfly doji pattern does not appear constantly. It is used as a technical indicator that signals a potential reversal of the asset’s price. What is a Doji…
What is Key Rate Duration? Key rate duration is a measure of a bond or bond portfolio’s sensitivity to a 100-basis point – 1% – change in yield at a specific maturity point. Key Rate Duration vs. Effective Duration The key rate duration is considered a superior metric to effective duration. It is because the…
What is Earned Income? Earned Income is perceived as payment through an employer or one’s own business. It can include the following: Wages Salaries Bonuses Tips Union strike benefits Long-term disability benefits Any other stream of legalized personal income Understanding Earned Income There are instances where income is not perceived as earned would be classified…
What is a Marketing Campaign? A marketing campaign, or a marketing strategy, is a long-term approach to promote a product or service through multiple mediums. It typically has one goal, which tends to be to an increase sales of a specific product. However, marketing campaigns don’t only have to revolve around one product; it can…
