Country screening involves using countries as the basic unit of analysis for market evaluation, allowing businesses to identify the most favorable markets for their products or services.
A coupon can refer to several aspects in the context of bonds, including the dated slip attached to a bond for interest payment collection, the rate of interest paid by a bond, or a general term for certain bonds and notes in the US Treasury markets.
A bond issued with detachable coupons that need to be presented to a paying agent or the issuer to receive semiannual interest payments. These are bearer bonds, meaning the interest is payable to whoever holds the coupon.
The Coupon Collector's Problem is a classic example in probability theory concerning how many trials are expected to collect all possible outcomes. This can be represented by the process of collecting coupons, each of which represents a unique outcome in a finite sample space.
Coupon stripping is a financial process in which the coupons are stripped off a bearer security and then sold separately as a source of cash, with no capital repayment; the bond, bereft of its coupons, becomes a zero coupon bond and is also sold separately.
Couponing is an advertising method where vouchers are distributed to consumers allowing discounts on merchandise or service purchased within a stated period of time. Couponing provides an incentive for increasing sales.
A court bond, also known as a judicial bond, is a form of surety bond that ensures compliance with a court's orders and protects against potential financial losses from legal proceedings.
A court that is required by law to maintain a record of its proceedings, including orders and judgments, and has the authority to imprison and levy fines.
Covariance is a statistical measure that indicates the extent to which two variables change together. A positive covariance suggests that the variables tend to increase or decrease in tandem, whereas a negative covariance indicates that as one variable increases, the other tends to decrease.
A covenant is a legally-binding promise made in a deed that can be enforced as a contract. It often involves agreements or restrictions related to financial obligations or land use.
A covenant not to compete is a contractual promise to refrain from conducting business or professional activities similar to those of another party, found primarily in employment, partnership, or sale of a business contracts.
The term 'cover' has multiple meanings in finance and corporate terms, commonly associated with buying back shorted positions, meeting fixed financial obligations, and the net-asset value supporting a security.
A Coverdell Education Savings Account (ESA) is a type of Individual Retirement Account (IRA) designed to help parents save for their child's education expenses. These accounts allow for tax-free growth and withdrawals for qualified education expenses.
A covered option is a type of option contract that is backed by the shares underlying the option. It involves the holder of the option also owning the equivalent amount of the underlying shares, reducing the risk compared to naked options.
CPA can stand for multiple terms including Certified Public Accountant, Critical-Path Analysis, and Customer Profitability Analysis. Each of these has specific implications in fields ranging from accounting to project management and customer relations.
A cracker is an individual who breaks into computer systems via the Internet and uses them without authorization, often with malicious intent.
A Craft Union is a union of skilled tradespeople sharing comparable trade skills. These unions are often organized locally and may be affiliated with larger organizations such as the AFL-CIO. An industry-wide union, such as the United Auto Workers or United Steelworkers, represents the opposite structure.
In bankruptcy, a cram down refers to the reduction of various classes of debt to a lower amount. It allows a bankruptcy reorganization plan to be confirmed even if some creditor classes vote against it, provided the plan is fair and equitable and does not unfairly discriminate against any dissenting class.
A rapid and significant decline in stock prices or economic activity, or a catastrophic hardware or software failure in data processing systems.
A crawler, also known as a spider, is a computer program that automatically navigates the World Wide Web (WWW) and collects information for various purposes such as indexing for search engines.
Creative accounting involves the use of accounting practices and principles that adhere to the letter of the rules of standard accounting practices but deviate from the spirit of those rules. This kind of accounting presents company financial performance in an overly favorable light, often inflating profits and hiding liabilities.
An annual two-volume worldwide directory of creative suppliers such as photographers, illustrators, directors, production facilities, and photofinishers, sometimes referred to as the 'Black Book.' The Creative Black Book sells advertising space on an annual basis.
Creative destruction is a free-market concept popularized by economist Joseph Schumpeter that holds economic progress results from entrepreneurial innovation, inevitably leading to the destruction of established businesses that become obsolete.
Any financing arrangement other than a traditional mortgage from a third-party lending institution. Creative financing devices include loans from seller, balloon-payment loans, wraparound mortgages, assumption of mortgage, sale and lease-backs, land contracts, and alternative mortgage instruments.
Credit is a financial term that refers to the ability to borrow money or access goods or services with the understanding that you'll pay later. It encapsulates various arrangements and concepts within personal and corporate finance. Credit influences numerous aspects of the economy, from individual purchasing power to corporate financial strategies.
A term used in accounting to indicate an entry made on the right-hand side of an account ledger, typically representing a decrease in assets or an increase in liabilities and equity.
A credit analyst is a professional responsible for evaluating the financial affairs of individuals or corporations to determine their creditworthiness. They assess the risk associated with lending and determine credit ratings.
A credit balance is an accounting term that refers to the situation where the total of credit entries in an account exceeds the total of debit entries. These balances typically represent revenue, liabilities, or capital.
A private organization that maintains consumer credit data files and provides credit information to authorized users for a fee.
Credit bureau scores are numerical expressions based on a statistical analysis of a person's credit files, representing the creditworthiness of that individual.
A credit card is a plastic card issued by a bank or finance organization allowing the holder to make purchases in shops, hotels, restaurants, petrol stations, etc., on credit.
Legislation designed to curb fees, interest rate increases, and other abusive practices by credit card companies. The legislation went into effect fully in February 2010.
Credit control is a system used by organizations to ensure their outstanding debts are paid within a reasonable period, involving the establishment of a credit policy, assessment of clients' credit rating, and the management of overdue accounts.
A period during which lenders are unwilling to extend credit to borrowers. The term is particularly associated with the period beginning in late 2007, when the previous era of 'easy credit' came to a sudden end in the wake of the subprime lending fiasco.
A Credit Default Option (CDO) is an option that grants the holder the right, but not the obligation, to enter into a credit default swap at a predetermined price on a specified future date. It is a form of swaption and is used to hedge against credit risk.
A Credit Default Swap (CDS) is a financial derivative that allows an investor to 'swap' or offset their credit risk with that of another investor.
A financial derivative that functions like an insurance contract where one party pays periodic fees in exchange for compensation in the event of default by a third party, known as the reference entity.
A credit default swap (CDS) is a financial derivative that allows an investor to swap or offset their credit risk with that of another investor. The buyer of a CDS makes periodic payments to the seller and, in return, receives a payoff if the underlying financial instrument defaults.
A financial instrument where the payoff is linked to the credit rating or payment performance of the underlying asset, involving various structures such as unfunded and funded derivatives.
Credit enhancement involves various techniques to improve the credit rating of asset-backed securities, either through internal measures by the issuer or external methods such as third-party guarantees.
A credit entry is made on the right-hand side of an account, representing an increase in a liability, revenue, or equity item, or a decrease in an asset or expense.
A comprehensive record of an individual's debt repayment behaviors and actions, utilized by lenders to evaluate creditworthiness.
A credit limit refers to the maximum balance that a credit card issuer allows a customer to borrow on their credit card. It is a fundamental aspect of credit management and determines the extent of a cardholder's purchasing power.
A credit line, also known as a line of credit, refers to a pre-approved loan amount that a borrower can draw upon as needed and repay either immediately or over time. It is commonly used for short-term borrowing needs.
A Credit Note is a financial document issued by a seller that reduces the amount payable by a customer, typically issued when goods are returned or an overcharge needs correction.
A credit order is a transaction where goods or services are provided without immediate payment, rather, billing occurs at a subsequent time. This is a standard practice in many business transactions.
An assessment of the creditworthiness of an individual or a firm, indicating the extent to which they can safely be granted credit. It is a crucial element in financing and investing decisions.
Credit rationing refers to the allocation of loans to creditworthy borrowers by means other than pure market mechanisms. This often occurs when interest rates are maintained below the level that an unregulated market would set, resulting in excess demand for loans.
Standards established by creditors that must be satisfied by potential debtors in order for credit to be given, typically reflecting the applicant's ability to repay the loan or make payments for goods or services acquired.
Credit risk refers to the potential that a borrower or counterparty will fail to meet its obligations in accordance with agreed terms. This concept is crucial for lenders and investors as it impacts the stability and profitability of financial institutions and markets.
A sale made on terms in which cash is to be paid at an agreed future date. As the debtors, who are customers to whom credit sales have been made, pay, the debtors' control account balance will be reduced.
Credit Scoring is an objective methodology used by credit grantors to determine how much credit to grant to an applicant. Various factors like income, assets, employment history, residence stability, and past credit behavior are considered.
Credit standing refers to the reputation an individual or business earns for paying debts. It relates to the perceived reliability in fulfilling financial obligations based on past behavior.
A shopping center or office building tenant that is large enough, old enough, and financially strong enough to be rated at least investment grade by one of the major credit rating services. A property leased to such a tenant may obtain mortgage financing underwritten on the basis of the tenant's likelihood of honoring its lease.
A credit transfer is a system that enables the transfer of money from one bank account to another, based on instructions given by the payer, detailing the receiver’s sort code and account number.
A credit union is a not-for-profit financial institution, typically formed by employees of a company, a labor union, or a religious group, and operated as a cooperative.
Credit Watch is a term used by bond rating agencies to indicate that a company's credit is under review and its rating is subject to change. The implication is that if the rating is changed, it will typically be lowered, usually due to an event that adversely affects the income statement or balance sheet.
A creditor is an entity that is owed money, either for goods or services provided or as a result of a loan. Creditors have a legal right to claim the owed amount from the debtor.
Creditor-days ratio provides an estimate of the average number of days credit an organization takes before paying its creditors. It's an essential measure of financial stability and cash flow management.
Creditors are individuals or entities to whom an organization or an individual owes money, such as unpaid suppliers of raw materials. Effective management of creditor payments is essential for maintaining credit periods and securing prompt-payment discounts.
Fixed capital of a company which gives confidence to creditors for investing in the company by providing assurance of a stable capital base.
A creditors' ledger is a memorandum ledger account used to track individual creditors' accounts, contributing to internal control by recording and comparing transactions with the nominal ledger.
A comprehensive guide covering the definition, examples, FAQs, related terms, online resources, and suggested books for further study on Creditors' Ledger Control Account, also known as Purchases Ledger Control Account.
Creditors' Voluntary Liquidation (CVL) is the process of winding up a company by a special resolution of its members when the company is insolvent. It involves a meeting with creditors and appointing a liquidator to manage the liquidation process.
Creditors' Voluntary Liquidation (CVL) is a process whereby the directors of a company make the decision to voluntarily liquidate the company to pay off its debts, with the creditors actively participating in and overseeing the liquidation process.
An assessment of a person's or a business's ability to pay for goods purchased or services received. Creditworthiness is often represented by a credit rating, which provides lenders insight into the risk of extending credit to the borrower.
A corporate philosophy that guides the way a company does business. It encompasses the company's values, mission, and principles, influencing decision-making, behavior, and company culture.
Creeping inflation refers to slow but continuous inflation that appears manageable over short periods but can lead to substantial long-term price increases if left unchecked.
CREST is an electronic share settlement system established by the Bank of England in 1996, revolutionizing the way securities transactions are settled in the UK by enabling electronic registration and instantaneous settlement, ultimately streamlining dividend payments and eliminating the need for paper certificates.
A crime is an act that the government has determined to be injurious to the public and which can therefore be prosecuted in a criminal proceeding. Crimes encompass felonies and misdemeanors.
Crisis management is a systematic approach to mitigating potentially severe outcomes in various critical situations, including disaster response for aircraft, naval incidents, fire emergencies, and flood protection.
Critical mass refers to the size or scale at which a business activity acquires self-sustaining viability.
Critical Path Analysis (CPA), also known as Critical Path Method (CPM), is a decision-making technique used to determine the minimum time necessary to complete a project by identifying the longest sequence of dependent activities from initiation to completion.
The Critical Path Method (CPM) is a planning and control technique that optimizes the order of steps in a process given the costs associated with each step. It is widely used in the manufacturing industry to plan and control the complete process of material deliveries, paperwork, inspections, and production.
In statistical hypothesis testing, the critical region refers to the set of values for the test statistic that leads to the rejection of the null hypothesis.
The Critical-Path Method (CPM) is a step-by-step project management technique for process planning that defines critical and non-critical tasks to minimize schedule delays and time-cost trade-offs.
Crony capitalism refers to an economic system characterized by close, mutually advantageous relationships between business leaders and government officials.
A core terminological aspect of South Asian finance representing a unit in the Indian numbering system, which equals ten million (10,000,000) in the International System.
A securities transaction in which the same broker acts as agent on both sides of the trade. The practice, called 'crossing,' is legal only if the broker first offers the securities publicly at a price higher than the bid.
Cross merchandising is a retail strategy involving the display of complementary products together to increase sales. This technique, often used in supermarkets, aims to encourage customers to purchase related items.
A Cross Purchase Plan is a life insurance strategy used among business partners. Each partner buys a life insurance policy on the other partners to ensure business continuity and facilitate buyouts in the event of a partner's death.
A cross rate refers to the exchange rate between two currencies which is derived from their individual exchange rates with a third currency, often the US dollar.
Cross tabulation, also known as contingency table analysis, is a statistical technique used to establish an interdependent relationship between two or more tables of values, without identifying a causal relationship. This method is widely utilized in data analysis to compare and understand the relationship between two categorical variables.
A cross-default clause in a loan agreement that stipulates that a default on one loan can trigger defaults on other loans held by the same borrower.
Cross-footing is a verification process used in spreadsheets where the sums of rows and columns of numbers are compared to ensure accuracy.
Cross-functional teams are employee teams consisting of individuals from two or more functional organizational areas who work together to achieve a common goal.
Cross-price elasticity measures the extent to which the price of a specified good is affected by the price of another complementary or substitute good. It is a crucial concept in microeconomics that helps understand the interdependencies between different products in the market.
Cross-sectional analysis involves comparing the accounting ratios of one company with those of its peers to assess profitability, liquidity, and capital structure. This method helps in determining a company's performance relative to its competitors.
A crossed cheque is a cheque that has two parallel lines drawn across its face with the purpose of instructing the bank that the cheque should only be deposited directly into a bank account and not immediately cashed by the bank over the counter.
A group of exchange members with a defined area of function, tending to congregate around a trading post pending execution of orders, including specialists, floor traders, odd-lot dealers, and other brokers, as well as smaller groups with specialized functions.
Crowdfunding refers to the financing of a new company or other project by selling shares or bonds directly to small private investors via the Internet. Despite its attractions, there have been fears that this growing practice offers scant legal protection to investors or to entrepreneurs, who may find their ideas are stolen and developed by others. In the UK and the USA, crowdfunding platforms have increasingly been brought within the remit of the regulatory authorities.
Crowding out occurs when heavy federal borrowing leads to higher interest rates, which subsequently reduces the borrowing ability of businesses and consumers.
A Crown Jewel Option is a defensive strategy used by companies to prevent hostile takeovers by giving a partner or friendly company the right to buy some of its best assets at a favorable price if a takeover were successful.
In corporate mergers and acquisitions, the term 'crown jewels' refers to the target company's most desirable and valuable properties. The disposal or sale of these assets can significantly reduce the company's overall value and attractiveness as a candidate for takeover.
A Crown loan is a demand loan extended to children or parents of the lenders, named after Chicago industrialist Harry Crown. Originally interest-free, such loans are now regulated to include a market rate of interest or they are subject to gift taxes.
A slang term referring to a work situation where a deadline is near, and employees are working intensely, often with extended hours. This situation usually results from time estimates made by management rather than genuine emergencies.
A dead-end street with a single entrance and a turning circle at the closed end, commonly used in residential subdivision design to increase privacy and reduce traffic.
Culpable means deserving of moral blame or punishment; at fault. One is considered culpable when they have acted with indifference to consequences and to the rights of others.
A comprehensive look at cum dividend, cum rights, and cum warrant stock scenarios, covering the stipulations for buyers to be eligible for declared distributions upon purchasing stock. This article also addresses related terms such as the ex-dividend date.
Cum rights refer to trading shares that include the rights or entitlements attached to securities, typically related to dividends or other special benefits. Investing in cum rights allows shareholders to receive upcoming dividends or participate in other corporate actions.
