by Henry Liverman | May 1, 2021 | Market Definitions
A debt security issued by a government to fund federal spending or programs. Government bonds represent debts issued by a government itself. They are generally considered to be low-risk investments as they’re backed by the issuing government. The US Treasury...
by Henry Liverman | May 1, 2021 | Market Definitions
The general decline in the price of goods and services. Generally, deflation occurs when the supply of money and credit contract, but prices can also decline due to increased productivity and technological improvements. Whether is economy or money supply are in a...
by Henry Liverman | May 1, 2021 | Market Definitions
A type of debt security that is issued by a firm and sold to potential investors. In this system, the company receives the capital it needs, and the investors are paid a pre-established number of interest payments (with a fixed or variable interest rate). When the...
by Henry Liverman | May 1, 2021 | Market Definitions
A strategy for options trading designed to imitate a long stock position. A synthetic long stock is created by purchasing at-the-money calls and then selling an equivalent number of at-the-money puts with the same expiration date. The downside of a synthetic long...
by Henry Liverman | May 1, 2021 | Market Definitions
An immediate injection of financial support into a company or organization facing imminent bankruptcy or collapse. Bailouts can take the form of loans, cash, bonds, or stock purchases. They may or may not require financial reimbursement. A bailout may also be...
by Henry Liverman | Apr 30, 2021 | Market Definitions
An official document companies must file with Securities and Exchange Commission (the SEC) as part of a registration process in order to provide an investment offering to the public. They’re filed for stocks, bonds, and mutual funds. These documents assist...
by Henry Liverman | Apr 30, 2021 | Market Definitions
Also referred to as a trading range. This occurs when a security trades within consistent high and low prices for a period of time. The top of the range provides price resistance, while the bottom provides price support and the value of the security fluctuates...
by Henry Liverman | Apr 30, 2021 | Market Definitions
A variation of a futures contract, a perpetual futures contract (or perpetual swap) is an agreement between two counterparty traders to buy or sell an asset at a non-specified point in the future. They differ from traditional futures contracts in that there is no...
by Henry Liverman | Apr 30, 2021 | Market Definitions
The opposite of “overbought,” oversold refers to a security that is trading at a lower price and has the potential to bounce back. Oversold conditions don’t necessarily mean that a bounce-back is imminent, however. They can last for a long time, so...
by Henry Liverman | Apr 30, 2021 | Market Definitions
When a security is believed to be trading at a level above what it should be valued, it is referred to as “overbought.” A pre-assumption with overbought stocks is that the upward movement is a short-term phenomenon and that the market will correct the...
