A legal precedence that dictates if the sale of the company is forthcoming, the main goal the company's board of directors should have is to conduct the proceedings in a manner that would yield the most benefit for the company's shareholders. Essentially, assuming that a number of situations are fulfilled (there are two or more buyers, all bids are cash-based acquisitions and that all parties have the requisite financing), the board of directors should always be picking the highest bid. Taobiz explains Revlon Rule The Revlon rule came from a court case in 1985 where directors from Revlon Inc. accepted a lower bid by white knight, Ronald Perelman, through implementing a series of takeover defenses to stave off a hostile takeover from Pantry Pride. It was found that Revlon's directors did not act in accordance with their fiduciary duty to their shareholders by accepting the lower bid, because they wished to avoid the consequences of certain earlier actions, which Pantry Pride would not have condoned.
Refers to a special kind of convertible corporate bond that automatically converts itself into shares of the company's stock in the event that the underlying stock drops below a certain price. This stands in contrast to traditional convertible bonds, which the bondholder may or may not choose to convert into shares of company stock. These revertible bonds generally have a time limit or expiration date when the bond will automatically convert into stock or forever remain a bond. Typically, these bonds pay very high interest rates and are offered by companies that are considered well-below investment grade. They are also known as reverse convertible bonds. Taobiz explains Revertible Depending on your point of view, revertible bonds or notes can be advantageous or dangerous to an investor's bottom line. Considering that the automatic conversion feature of these bonds only kicks in if the stock price plummets, a conversion would likely reflect the marketplace viewing the company as suddenly financially unstable. In this event, the company's stock may be more attractive to investors looking to abandon ship, since a thinly traded stock may be easier to unload than an illiquid bond. But, it also may set up an investor who wishes to stay invested for a total loss, since bondholders get priority over common stock holders when it comes to a corporation liquidating its assets.
A stock split strategy that includes the use of a reverse stock split followed by a forward stock split. A reverse/forward stock split is usually used by companies to cash out shareholders with a less-than-certain amount of shares. This is believed to cut administrative costs by reducing the number of shareholders who require mailed proxies and other documents. Taobiz explains Reverse/Forward Stock Split For example, if a company declares a reverse/forward stock split, it could start by exchanging one share for 100 shares that the investor holds. Investors with fewer than 100 shares would not be able to do the split and would therefore be cashed out. The company would then do a forward stock split for 100 for 1, which will bring shareholders that were not cashed out to their original number of shares.
A reduction in the number of a corporation's shares outstanding that increases the par value of its stock or its earnings per share. The market value of the total number of shares (market capitalization) remains the same. Taobiz explains Reverse Stock Split For example, a 1-for-2 reverse split means you get half as many shares, but at twice the price. It's usually a bad sign if a company is forced to reverse split - firms do it to make their stock look more valuable when, in fact, nothing has changed. A company may also do a reverse split to avoid being delisted.
A provision contained in an public offering underwriting agreement that gives the underwriter the right to sell the issuer shares at a later date. The reverse greenshoe option is used to support the price of a share in the event that after the IPO the demand for the stock falls. The underwriter would purchase shares for the depressed price in the market, and sell them to the issuer at a higher price by exercising the option. This activity of buying a large amount of shares in the open market is intended to stabilize the price of the stock. Taobiz explains Reverse Greenshoe Option A reverse greenshoe option differs from a regular greenshoe option as they are put and call options respectively. A reverse greenshoe option is essentially a put option written by the issuer or primary shareholder(s) that allows the underwriter to sell a given percentage of shares issued at a higher price should the market price of the stock fall. In contrast, a regular greenshoe option is essentially a call option written by the issuer or primary shareholder(s) that allows the underwriter to buy a given percentage of shares issued at a lower price to cover a short position taken during the underwriting. Both methods have the same effect of market price stabilization, however it is believed that the reverse greenshoe option is more practical.
An ownership unit in a royalty trust. A royalty unit gives the unit holder a stake in the income generated by the holdings of the trust. A royalty trust takes ownership stakes in operating companies or in their cash flows. The royalty trust owns the income or cash flow that the company generates and passes this income on to the royalty unit holders of that trust. Royalty units are seen as an attractive investment because the income generated by the assets is subject to taxes at the individual level, rather than the double taxation which is seen with dividends on common stock. Taobiz explains Royalty Units For example, let’s say that an investor holds a royalty unit in ABC Oil & Gas Royalty Trust, which owns several oil-producing operations. The investor in the royalty trust will receive income distributions as the underlying oil-producing operations generate income for the trust. If the trust’s assets generate $1 million dollars and there are 100,000 royalty units, each unit will receive $10.
Statistical measures that are historical predictors of investment risk and volatility and major components in modern portfolio theory (MPT). MPT is a standard financial and academic methodology for assessing the performance of a stock or a stock fund compared to its benchmark index. Taobiz explains Risk Measures There are five principal risk measures: Alpha: Measures risk relative to the market or benchmark index Beta: Measures volatility or systemic risk compared to the market or the benchmark index R-Squared: Measures the percentage of an investment's movement that are attributable to movements in its benchmark index Standard Deviation: Measures how much return on an investment is deviating from the expected normal or average returns Sharpe Ratio: An indicator of whether an investment's return is due to smart investing decisions or a result of excess risk. Each risk measure is unique in how it measures risk. When comparing two or more potential investments, an investor should always compare the same risk measures to each different potential investment to get a relative performance.
Trading arenas, located on the floor of an exchange, in which traders execute orders. Rings are also referred to as pits. Taobiz explains Rings You've probably seen pictures of traders wildly thrashing their arms and yelling orders in the trading rings. Although it may look poorly coordinated, there is actually trading going on.
登录
工商服务
危机公关
金融律师
app开发
财税服务
金融牌照
网站建设
知识产权
企业征信
审计评估