Under the Tent
What Does “Under the Tent” Mean? An under the tent deal is a business transaction that is not disclosed to the public and is usually known by only a small select group of buyers or a single buyer. There is usually no open auction with multiple buyers seeking to be the best bidder. Instead, the...
Ex-Ante vs Ex-Post
What is Ex-Ante vs Ex-Post? Ex-ante and Ex-post are Latin terminologies used in predicting the returns of a security. In this article, we will discuss ex-ante vs ex-post in detail. When transcribed from Latin, ex-ante is the prediction of a particular event in the future, such as the potential returns of a company. Ex-ante predictions are...
Payoff Graphs vs Profit & Loss Diagrams
Payoff Graphs vs Profit & Loss Diagrams Investors use payoff graphs vs profit & loss diagrams to determine returns from options trading. Option payoffs are simply the reward or return that one can expect from investing in or being involved in options trading. One can either earn a profit on the invested amount or, in...
Credit Spread
What is Credit Spread? Credit spread is the difference between the yield (return) of two different debt instruments with the same maturity but different credit ratings. In other words, the spread is the difference in returns due to different credit qualities. For example, if a 5-year Treasury note is trading at a yield of 3%...
Treasury Stock Method
What is the Treasury Stock Method? The treasury stock method is a way for companies to calculate how many additional shares may be generated from outstanding in-the-money warrants and options. The new additional shares are then used in calculating the company’s diluted earnings per share (EPS). The treasury stock method implies that the money obtained...
