A term used to describe the elimination of a contract due to the obligation of delivery. This occurs if an option is exercised, if a redeemable bond is called before maturity or if a short position held in a security requires delivery. Taobiz explains Called Away For example, if an investor has written a call option and the holder of the option exercises it, then the option has been "called away" and the writer has to complete his/her obligation to the contract. When an investment is "called away", it can result in an investor missing out on potential gains in the underlying asset.
Common stock that allows the issuer to call back the stock at a specific price. Taobiz explains Callable Common Stock Typically, callable common stock is issued for a subsidiary company by the parent company. The parent company reserves the right to buy back the shares of the subsidiary company should it be strategically beneficial.
A rise in the value of an asset based on a rise in market price. Essentially, the capital that was invested in the security has increased in value, and the capital appreciation portion of the investment includes all of the market value exceeding the original investment or cost basis. Capital appreciation is one of the two main sources of investment returns, with the other being dividend or interest income. Taobiz explains Capital Appreciation For example, say you purchase a share for $10, which pays a dividend of a $1 per share each year, and is now trading at $15 per share a year later. Your capital appreciation in the investment is $5, or 50%, as the price of the share has increased $5 over your purchase price or cost basis. Your interest income return is $1, or 10%, for a total return on the shares is $6 or 60%. Capital appreciation is often a stated investment goal of many mutual funds. These funds look to find investments that will rise in value based on increased earnings or other fundamental metrics. Investments targeted for capital appreciation tend have more risk than assets chosen for capital preservation and income generation, such as government, municipal bonds, or dividend-paying stocks. Because of this, capital appreciation funds are considered appropriate for risk-tolerant investors.
A notice informing a customer of the cancellation of an erroneous trade that has been credited to his or her account by the broker. Taobiz explains Cancellation Even stock brokers are subject to human error. When an error is made, set guidelines must be followed to rectify the situation. For example, if a broker mistakenly over-purchases 100 shares of Cory's Tequila Corporation for your account, he or she must sell the 100 shares and bear any losses in his or her internal account. Each transaction is properly recorded and you will be sent statements showing the changes to your account. The procedure is done to ensure that the broker is not improperly trading for your account.
1. A previously submitted order to purchase or sell a security that is canceled before it has been executed on an exchange. 2. An order that can't be executed due to parameter limitations, such as a limit order that can't be filled because the price has moved outside of range. Taobiz explains Canceled Order Most equity orders (especially market orders) are executed so fast today that canceling them before execution may not be possible despite the investor's efforts. Limit orders that are outside of the current stock price can usually be canceled online or by calling the broker directly. Other order types that can quickly become canceled orders are "all-or-none" orders and "fill or kill" orders.
Equity which cannot otherwise be classified as capital stock or retained earnings. It's usually created from a stock issued at a premium over par value. Taobiz explains Capital Surplus Capital surplus is also known as share premium (UK), acquired surplus, donated surplus, paid-in surplus, or additional paid-in capital.
The common and preferred stock a company is authorized to issue, according to their corporate charter. Taobiz explains Capital Stock Capital stock are normally listed on a company's balance sheet. In financial statement analysis, an increasing capital stock account tends to be a sign of economic health since the company can use the additional proceeds to invest in projects or machinery that will increase corporate profits and/or efficiency.
The class of shares offered by a dual-purpose fund that has opportunity for capital appreciation but does not offer the holder any portion of the fixed income earned within the portfolio. Taobiz explains Capital Share Capital shares typically attract investors that are looking more for capital growth than for income growth as profits are made only if the stocks increase in price.