Category: Investor Definitions

Proving securities ownership is easier if you can remember how the security was acquired. Brokerage Firm If you bought the security through a brokerage firm, contact the firm and ask if they have a record of your ownership.  Brokerage firms are required to keep records for only six years.  Copies of confirmations are only required… Continue reading PROVING SECURITIES OWNERSHIP

A document that describes the mutual fund to prospective investors. Every mutual fund provides a prospectus with information about the mutual fund’s investment objectives, risks, past performance, and expenses. You can get a prospectus from the mutual fund company’s website or by mail. A broker or other financial professional also can provide you with a… Continue reading PROSPECTUS

Promissory notes are a form of debt that companies sometimes use to raise money. They typically involve investors loaning money to a company in exchange for a fixed amount of periodic income. Although promissory notes can be appropriate investments for many individuals, some fraudsters use promissory notes to defraud investors, especially the elderly.

Revenue minus cost; money made on a transaction.

A summary of key information about an ETF that explains how to obtain a prospectus.

The total amount of money being borrowed or lent; the initial amount of money invested.

“Prime bank” investments are scams. Promoters of “prime bank” programs often claim that investors’ funds will be used to buy and trade supposed “prime bank” instruments, and that investors will receive guaranteed, high investment returns with little or no risk. Promoters try to make the schemes sound legitimate by using complex, sophisticated, and official-sounding terms.… Continue reading PRIME BANK INVESTMENTS

Markets in which newly issued securities are sold to investors and the issuer receives the proceeds.

A company’s P/E ratio is a way of gauging whether the stock price is high or low compared to the past or to other companies. The ratio is calculated by dividing the current stock price by the current earnings per share. Earnings per share are calculated by dividing the earnings for the past 12 months… Continue reading PRICE-EARNINGS (P/E) RATIO

The risk that principal repayment will occur earlier than scheduled, forcing the investor to reinvest at lower prevailing rates.