Tag: Glossary

A custodian that has legal responsibility for the safekeeping of securities entrusted to it by another custodian.

An over-the-counter financial instrument created specifically to meet the needs of one or a small number of investors. Some of the more common structures include: step-up bonds, index amortizing notes, dual index notes, deleveraged bonds, range bonds, and inverse floaters.

An acronym for Separately Traded Registered Interest and Principal Securities. These securities are created by “stripping” coupon payments from securities and treating these coupons as separate securities from the principal.

Debt securities that have been transformed from a principal amount with periodic interest coupons into a series of zero-coupon securities with the range of maturities matching the coupon payment dates and the redemption date of the principal amount.

The fifty states of the United States and the District of Columbia, Puerto Rico and the U.S. territories and possessions, and their political subdivisions, including counties, municipalities, school districts, irrigation districts, and drainage and sewer districts. INCLUDES, but is not limited to the following activities that issue securities: General municipal obligation bonds; Housing/Multi-family programs (housing… Continue reading STATE OR LOCAL GENERAL GOVERNMENT

A debt security on which the interest and principal payments are made from a sinking fund. A sinking fund is money accumulated on a regular basis in a separate custodial account that is used to retire a certain amount of the debt at specified intervals and to pay interest on the remaining principal at specified… Continue reading SINKING FUND DEBT or SINKER

Debt security, including negotiable money market instruments, with an original maturity of one year or less.

Original maturity of one year or less.

A share is a unit of equity ownership in a corporation; mutual fund; or interest, normally represented by a certificate, in a general or limited partnership. Ownership and transactions are sometimes made and priced in terms of other units, such as a “unit” of a Unit Investment Trust. In the case of Exchange-Traded-Funds, large investors… Continue reading SHARES or OTHER UNITS OF FUNDS

Under settlement date accounting, assets purchased are not recorded until settlement date. Therefore, only after receiving or sending payment for any financial instrument should the transaction or position be reported.