An auditor’s opinion is a certification that accompanies financial statements. It is based on an audit of the procedures and records used to produce the statements and delivers an opinion as to whether material misstatements exist in the financial statements. An auditor’s opinion may also be called an accountant’s opinion.
Wash trading is a process whereby a trader buys and sells a security for the express purpose of feeding misleading information to the market. In some situations, wash trades are executed by a trader and a broker who are colluding with each other, and other times wash trades are executed by investors acting as both the buyer and the seller of the security. Wash trading is illegal under U.S. law, and the IRS bars taxpayers from deducting losses that result from wash trades from their taxable income.
Serial correlation is the relationship between a variable and a lagged version of itself over various time intervals. Repeating patterns often show serial correlation when the level of a variable affects its future level. In finance, this correlation is used by technical analysts to determine how well the past price of a security predicts the future price.
Baby boomer is a term used to describe a person who was born between 1946 and 1964. The baby boomer generation makes up a substantial portion of the world’s population, especially in developed nations. It represents nearly 20% of the American public.
The transfer on death designation lets beneficiaries receive assets at the time of the person’s death without going through probate. This designation also lets the account holder or security owner specify the percentage of assets each designated beneficiary receives, which helps the executor distribute the person’s assets after death. With TOD registration, the named beneficiaries have no access to or control over a person’s assets as long as the person is alive.
Next of kin refers to a person’s closest living blood relative. The next-of-kin relationship is important in determining inheritance rights if a person dies without a will and has no spouse and/or children. The next of kin may also have responsibilities during and after their relative’s life. For example, the next of kin might need to make medical decisions if the person becomes incapacitated, or take responsibility for their funeral/burial arrangements and financial affairs after their relative dies.
A long straddle is an options strategy where the trader purchases both a long call and a long put on the same underlying asset with the same expiration date and strike price. The strike price is at-the-money or as close to it as possible. Since calls benefit from an upward move, and puts benefit from a downward move in the underlying security, both of these components cancel out small moves in either direction, Therefore the goal of a straddle is to profit from a very strong move, usually triggered by a newsworthy event, in either direction by the underlying asset.
An offtake agreement is an arrangement between a producer and a buyer to purchase or sell portions of the producer’s upcoming goods. An offtake agreement is normally negotiated prior to the construction of a production facility—such as a mine or a factory—to secure a market for its future output.
A wet loan is a mortgage in which the funds realize at—or with the completion of—a loan application. Submission of other required documentation for closing the property, such as surveys and title searches, happens after the dispersion of funds.
A nonprofit organization is a business that has been granted tax-exempt status by the Internal Revenue Service (IRS) because it furthers a social cause and provides a public benefit. Donations made to a nonprofit organization are typically tax-deductible to individuals and businesses that make them, and the nonprofit itself pays no tax on the received donations or on any other money earned through fundraising activities. Nonprofit organizations are sometimes called NPOs or 501(c)(3) organizations based on the section of the tax code that permits them to operate.1