Kamikaze Defense
What is Kamikaze Defense? Kamikaze defense refers to a type of strategy that a target company can take to defend against a hostile takeover. “Kamikaze” means “divine wind” in Japanese. It was originally a special attack unit of the Japanese army, particularly responsible for performing suicide attacks. In the business world, it represents an anti-takeover...
Escrowed Shares
What are Escrowed Shares? Escrowed shares are securities that are maintained in a special type of account until a specific business transaction is completed. The special type of account is called an escrow account. What is an Escrow Account? An escrow account is a type of account where assets/funds are maintained when transactions like mergers...
Head Trader
What is a Head Trader? A head trader refers to either the head of an independent trading company or the head of the trading department at a registered securities firm or other financial institution that conducts trading in the financial markets. Job Responsibilities of a Head Trader 1. Ensure regulatory compliance with local, state, and...
Hostile Takeover Bid
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...
Merger vs. Acquisition
What is a Merger vs Acquisition? Mergers and acquisitions both refer to the joining of two or more business entities that entail a restructuring of their corporate order. They are aimed at achieving better synergies within the organization in order to increase their competence and efficiency. However, there are key differences between a merger vs....
Middle Office
What is the Middle Office? The middle office is a department within a financial services institution. It comprises a team of employees that includes risk managers, information technology officers, and other officers who manage risks within the organization, as well as managing information technology. How It Works A financial services institution, such as an investment...
Engagement Letter
What is an Engagement Letter? An engagement letter refers to a legal document that defines the relationship between a business providing professional services (accounting, consulting, legal, etc.) and their clients. It sets the terms of the agreement between two parties and includes details such as the scope, fees, and responsibilities, among others. An engagement letter...
Equity Financing
What is Equity Financing? Equity financing refers to the sale of company shares in order to raise capital. Investors who purchase shares also acquire ownership rights in the company. Equity financing can refer to the sale of all equity instruments, such as common stock, preferred shares, and share warrants. Equity financing is especially important during...
Money Center Bank
What is a Money Center Bank? A money center bank is a bank that is located in major cities like London, New York, and Hong Kong. It covers regions, countries, and continents, providing a wide range of financial services. Its revenue primarily comes from transactions with large corporations, other retail banks, and governments. They are also...
Exit Strategies
What are Exit Strategies? Exit strategies are plans executed by business owners, investors, traders, or venture capitalists to liquidate their position in a financial asset upon meeting certain criteria. An exit plan is how an investor plans to get out of an investment. When Are Exit Strategies Used? An exit plan may be used...
