Conversion parity is a concept in finance that refers to the equivalence between the value of a convertible security, such as a convertible bond, and the value of the common stock into which it can be converted.
Legging-out refers to the process of disposing of one or more unmatured elements of a qualified hedging transaction. Any gain or loss from legging-out is deferred until the qualifying debt instrument matures or is disposed of in the future.
The specific day when a financial obligation, such as a bond, bill of exchange, or insurance policy, comes due for payment, marking the end of its term.
An offering circular is an essential document used in securities offerings to provide detailed information about the investment opportunity, its terms, and the issuer. It serves a similar purpose to a prospectus but is typically used for different types of offerings.
A partly paid share is a share for which the shareholder has not yet paid the full par value. This concept was historically used by banks and insurance companies and has seen a revival in large share issues, notably in privatizations.
The Profit-Sharing Ratio (PSR) is a financial metric used to define how profits or losses are distributed among partners or stakeholders in a business or investment.
A 'Red Herring' is a preliminary prospectus filed by a company with the Securities and Exchange Commission (SEC), typically in connection with an initial public offering (IPO). It provides potential investors with crucial information about the company and its offering without disclosing the total number of shares and the price.
The redemption date refers to the specific date on which a bond or other fixed-income security is repaid by the issuer, fulfilling the terms of the debt agreement.
A redemption fee is a charge imposed for the repurchase or release of an asset from creditor claims, commonly used in mutual funds and other types of investments.
A tap stock, also known as a 'tap issue' or 'tap security,' is a gilt-edged security reissued in the market when its price reaches a pre-determined level. There are 'short taps' and 'long taps' depending on their maturity dates.
Unloading refers to the act of offloading or selling large quantities of an asset, typically at lower than market prices, generally to raise cash quickly or influence market conditions.
