Month: November 2020

A global registered share (GRS, or Global Share) is a security that is issued in the United States but is registered in multiple markets around the world and trades in multiple currencies. With GRSs, identical shares may trade on different stock exchanges and in various currencies across country borders without needing to be converted into local currencies. All holders of GRSs, as with any other shareholder, have equal rights — such as voting, percentage of dividends, and so forth — in the issuing corporation (issuer). read more

Digital marketing is the use of the Internet, mobile devices, social media, search engines, and other channels to reach consumers. Some marketing experts consider digital marketing to be an entirely new endeavor that requires a new way of approaching customers and new ways of understanding how customers behave compared to traditional marketing.

A retail investor, also known as an individual investor, is a non-professional investor who buys and sells securities, mutual funds, or exchange traded funds (ETFs) through traditional or online brokerage firms or other types of investment accounts. Retail investors purchase securities for their own personal accounts and often trade in dramatically smaller amounts as compared to institutional investors like pensions, endowments or mutual funds.

A micromanager is a boss or manager who gives excessive supervision to employees. A micromanager, rather than telling an employee what task needs to be accomplished and by when will watch the employee’s actions closely and provide frequent criticism of the employee’s work and processes.

The security market line (SML) is a line drawn on a chart that serves as a graphical representation of the capital asset pricing model (CAPM)—which shows different levels of systematic, or market risk, of various marketable securities, plotted against the expected return of the entire market at any given time. Also known as the characteristic line, the SML is a visualization of the CAPM, where the x-axis of the chart represents risk (in terms of beta), and the y-axis of the chart represents expected return. The market risk premium of a given security is determined by where it is plotted on the chart relative to the SML. read more

Pari-passu is a Latin phrase meaning equal footing that describes situations where two or more assets, securities, creditors, or obligations are equally managed without preference. An example of pari-passu occurs during bankruptcy proceedings: When the court reaches a verdict, the court regards all creditors equally, and the trustee will repay them the same fractional amount as other creditors at the same time.

The National Securities Markets Improvement Act is a law passed in 1996 to simplify securities regulation in the U.S. by apportioning more regulatory power to the federal government.

Earnings typically refer to after-tax net income, sometimes known as the bottom line or a company’s profits. Earnings are the main determinant of a company’s share price, because earnings and the circumstances relating to them can indicate whether the business will be profitable and successful in the long run. Earnings are perhaps the single most important and most studied number in a company’s financial statements. It shows profitability compared to analyst estimates, the company’s own historical performance, and relative to its competitors and industry peers. read more

Benjamin Graham was an influential investor whose research in securities laid the groundwork for in-depth fundamental valuation used in stock analysis today by all market participants. His famous book, The Intelligent Investor, has gained recognition as the foundational work in value investing.

Hindsight bias is a psychological phenomenon that allows people to convince themselves after an event that they had accurately predicted it before it happened. This can lead people to conclude that they can accurately predict other events. Hindsight bias is studied in behavioral economics because it is a common failing of individual investors.