Tag: stocks

Fungibility definition explanation

What is Fungibility?
A property a good or asset that describes its interchangeability with other individual goods/assets of the same type. Assets possessing this property simplify the exchange/trade process, as interchangeability assumes that everyone values all goods of that class as the same. Read more for examples and further explanation including related video clips and also comments
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Arbitrageur definition explanation

What is Arbitrageur?
A type of investor who attempts to profit from price inefficiencies in the market by making simultaneous trades that offset each other and captures risk-free profits. An arbitrageur would, for example, seek out price discrepancies between stocks listed on more than one exchange, buy the undervalued shares on one exchange while short selling the same number of overvalued shares on another exchange, thus capturing risk-free profits as the prices on the two exchanges converge. Read more for examples and further explanation including related video clips and also comments
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Nasdaq definition explanation

What is Nasdaq?
A computerized system that facilitates trading and provides price quotations on more than 5,000 of the more actively traded over the counter stocks. Created in 1971, the Nasdaq was the world’s first electronic stock market.

Stocks on the Nasdaq are traditionally listed under four or five letter ticker symbols. If the company is a transfer from the New York Stock Exchange, the symbol may be comprised of three letters. Read more for examples and further explanation including related video clips and also comments
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Downtick definition explanation

What is Downtick?
A transaction on an exchange that occurs at a price below the previous transaction.

In order for a downtick to occur, a transaction price must be followed by a decreased transaction price. This is commonly used in reference to stocks, but it can also be extended to commodities and other forms of securities. Read more for examples and further explanation including related video clips and also comments
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Non-Qualifying Investment definition explanation

What is Non-Qualifying Investment?
An investment that does not qualify for any level of tax-deferred or tax-exempt status. Investments of this sort are made with after-tax money. They are purchased and held in tax-deferred accounts, plans or trusts. Returns from these investments are taxed on an annual basis. Read more for examples and further explanation including related video clips and also comments
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Tax-Efficient Fund definition explanation

What is Tax-Efficient Fund?
A mutual fund in which structure and operations are based on reducing the tax liability that its shareholders face. Reducing the tax liability of a fund is done in three main ways:

1. By purchasing tax-free (or low taxed) investments such as municipal bonds.
2. Keeping the fund’s turnover low, especially if the fund invests in stock. Stocks held for more than one year are taxed at a lower long-term capital gains rate than short-term transactions.
3. Avoiding or limiting income-generating assets, such as dividend-paying stocks, which create a tax liability at each dividend issuance. Read more for examples and further explanation including related video clips and also comments
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Defined Portfolio definition explanation

What is Defined Portfolio?
An investment trust that invests in a predefined portfolio of bonds and/or stocks that have been professionally selected by the company. Similar to some classes of mutual funds, these trusts are closed-ended and are not actively managed. The securities in the portfolio are fixed, and units can only be sold after the initial buying phase. These units tend to have a predefined life of a handful of years, after which they are liquidated and the proceeds are returned to the investors. Read more for examples and further explanation including related video clips and also comments
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