Black Swan Event
What is a Black Swan Event? A black swan event, a phrase commonly used in the world of finance, is an extremely negative event or occurrence that is impossibly difficult to predict. In other words, black swan events are events that are unexpected and unknowable. The term was popularized by former Wall Street trader Nassim...
Debt Restructuring
What is Debt Restructuring? Debt restructuring is a process wherein a company or an entity experiencing financial distress and liquidity problems refinances its existing debt obligations in order to gain more flexibility in the short term and make their debt load more manageable overall. Reason for Debt Restructuring A company that is considering debt restructuring...
Special Dividend
What is a Special Dividend? A special dividend, also referred to as an extra dividend, is a non-recurring, “one-time” dividend distributed by a company to its shareholders. It is separate from the regular cycle of dividends and is usually abnormally larger than a company’s typical dividend payment. Special dividends are typically declared after exceptionally strong...
Stable Dividend Policy
What is the Stable Dividend Policy? A business with a stable dividend policy pays out a steady dividend every given period, regardless of the volatility in the market. The exact amount of dividends that are paid out depends on the long-term earnings of the company. The dividend’s growth is in line with the company’s long-term...
Pecking Order Theory
What is the Pecking Order Theory? The Pecking Order Theory, also known as the Pecking Order Model, relates to a company’s capital structure. Made popular by Stewart Myers and Nicolas Majluf in 1984, the theory states that managers follow a hierarchy when considering sources of financing. The Pecking Order Theory states that managers display the...
