Investor Education

The predating of a letter of intent (by as much as ninety days) to allow an investor to incorporate recent large deposits for the purpose of qualifying for a load discount on a purchase of open-end investment company shares.

Investment companies that strive to minimize market risks while at the same time earning reasonable current income with varying percentages of bond, preferred, and common stocks.

A declining securities market in terms of prices.

Bonds that do not have the owner's name registered on the books of the issuing corporation and that are payable to the bearer, frequently called coupon bonds. None have been issued since 1984.

The strategy an investor employs when it is thought that a security's price will decline.

A measure of a fund's sensitivity to market movements. The beta of the market is 1.00 by definition. A beta of 1.10 shows that the fund has performed 10% better than its benchmark index in up markets, and 10% worse in down markets, assuming all other factors remain constant.

The price at which a mutual fund's shares are redeemed (bought back) by the fund. The bid or redemption price usually means the net asset value per share.

A certificate representing creditorship in an issuer and issued to raise long-term funds. The issuer pays interest, usually semi-annually, plus principal when due. (See "Bearer Bond," "Mortgage Bond," "Tax-Exempt Securities," "United States Government Securities.")

The dollar level of investment necessary to qualify a purchaser for a discounted sales charge on a quantity purchase of open-end management company shares. (See "Backdating," "Letter of Intent.")

A general term for a securities firm that is engaged in both buying and selling securities on behalf of customers and also buying and selling on behalf of its own account.

A rising securities market in terms of prices.

The strategy an investor employs when it is thought that a security's price will increase.

A day on which financial markets are open for trading. Saturdays, Sundays and legal holidays are not considered business days.