AAA – Triple A In the medical world, a triple A is an Abdominal Aortic Aneurysm; seriously bad news. In the financial world, it is seriously good news. It’s a credit rating that is applied to top-quality bonds issued by governments and companies. Triple A status signals to investors that the issuer of the bonds […]

Backwardation To Blue Chip (Money)

Backwardation When share markets are moving very rapidly, such as in the 1987 stock market crash (where prices were falling so quickly that it was known as a fast market), sometimes there are inefficiencies in the way shares are priced. One market-maker (a professional trader who buys and sells shares for his firm’s ‘topic’) might […]

Annual Report and Accounts To Averaging Up (Money)

Annual Report and Accounts This is a glossy, slick document produced by all companies that are quoted on the Stock Exchange and it should come out within six months of the announcement of a company’s results. You get a summary of the company’s activities, a look-see at what it owns and how much money’s in […]

Cold Call To Cyclical Shares (Money)

Cold Call Uh oh. If you get a cold call, which is a call from the blue from a total stranger trying to flog you something in the investment field, you should just politely say, sorry you’re not interested in the venture, whatever it is, and put the phone down. If someone keeps bugging you, […]

Cable To Closed-End Funds (Money)

Cable It’s City slang for the exchange rate between the US dollar and the UK pound. Call When the City bods are calling you, it’s not just for a friendly social chat. It means they want money, specifically your money. There are situations when you are given the right to buy shares or whatever now, […]

Board of Directors To Buy In Management Buy Out – BIMBO (Money)

Board of Directors The people who sit at rather grand mahogany dining tables in wide, comfortable chairs. These are the bods who are elected by the shareholders to run a company and make decisions with regard to whom they employ, corporate policy and what the business should do strategically. Posh titles include chairperson, chief executive, […]

Dawn Raid To Dictum Meum Pactum (Money)

Dawn Raid Rather confusingly, dawn raids can occur at tea-time as well, which is a much more civilized time to conduct one of these, if you ask me. In City terms, this occurs when someone keen to get hold of a large chunk of a company’s shares, often with a view to making a bid […]

Financial Adviser To Fund of Funds (Money)

Financial Adviser Someone who gives you advice on your investments, including pensions and life insurance. The term financial adviser (FA) covers a wide remit – accountants, lawyers, actuaries and insurance brokers can all be FAs. When you’re looking for one always check that they are properly authorized (see Financial Services Authority). Remember you’re letting someone […]

EAR – Equivalent Annual Rate To Extraordinary Profit/Loss (Money)

EAR – Equivalent Annual Rate Applies specifically to overdrafts and shows the compounded annual cost of the loan expressed as a percentage. It does not take into account any additional charges (eg, penalty fees) that may be applicable (see Compounding). Earnings per Share – EPS You can wake up now as we’ve reached one of […]

Dilution To Due Diligence (Money)

Dilution You take ten lemons and squeeze them, diluting with… This is not Delia Smith’s cookery topic? Sorry about that folks, I must remember we are on the riveting subject of finance. Dilution might be good for Delia, but I’m afraid it’s not good news in the financial sense. This can happen to a shareholder […]