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Large Cap
A term used by the investment community to refer to companies with a market capitalization value of more than $10 billion. Large cap is an abbreviation of the term “large market capitalization”. Market capitalization is calculated by multiplying the number of a company’s shares outstanding by its stock price per share. Large cap companies are the big Kahunas of the financial world. Examples include Wal-Mart, Microsoft and General Electric.... -
Leveraged ETF
The main objective of leveraged ETFs is to deliver magnified performance of a particular stock, bond or commodity index. Most leveraged ETFs attempt to duplicate daily index returns by two or three times. Short leveraged ETFs aim for daily index returns that move in the opposite direction, but with magnified performance of two or three times. (Source: ETF Guide) -
Limit Order
A limit order sets the maximum you will pay for a security or the minimum you are willing to accept on a particular transaction. For example, if you place a limit order to buy a certain stock at $25 a share when its current market price is $28, your broker will not buy the stock until its share price reaches $25. Similarly, if you give a limit order to... -
Listed
Being included and traded on a given exchange. Most exchanges have specific requirements which companies must meet in order to be listed and continue to stay listed. Companies are frequently being added to a given exchange, such as the Nasdaq. And occasionally companies that have not fulfilled all necessary listing requirements become delisted for a period of time until they again meet the requirements. Generally, companies prefer to be... -
Long (Long Position)
The buying of a security such as a stock, commodity or currency, with the expectation that the asset will rise in value. In the context of options, the buying of an options contract. Opposite of “short” (or short position). For example, an owner of shares in McDonald’s Corp. is said to be “long McDonald’s” or “has a long position in McDonald’s.” For example, buying a call (or put) options... -
Managed Futures
An alternative investment strategy in which professional portfolio managers use futures contracts as part of their overall investment strategy. Managed futures provide portfolio diversification among various types of investment styles and asset classes to help mitigate portfolio risk in a way that is not possible in direct equity investments. Professional money managers, known as commodity trading advisors, typically monitor managed futures accounts. These accounts can have various weights in... -
Market Maker
A broker-dealer who is prepared to buy or sell a specific security — such as a bond or at least one round lot of a stock — at a publicly quoted price, is called a market maker in that security. Other brokers buy or sell specific securities through market makers, who may maintain inventories of those securities. There is often more than one market maker in a particular security,... -
Master Limited Partnerships
A type of limited partnership that is publicly traded. There are two types of partners in this type of partnership: The limited partner is the person or group that provides the capital to the MLP and receives periodic income distributions from the MLP’s cash flow, whereas the general partner is the party responsible for managing the MLP’s affairs and receives compensation that is linked to the performance of the...
