An idea presented in response to the Kyoto Protocol that involves the trading of greenhouse gas (GHG) emission rights between nations. For example, if Country A exceeds its capacity of GHG and Country B has a surplus of capacity, a monetary agreement could be made that would see Country A pay Country B for the right to use its surplus capacity.The Kyoto Protocol presents nations with the challenge of reducing greenhouse gases and storing more carbon. A nation that finds it hard to meet its target of reducing GHG could pay another nation to reduce emissions by an appropriate quantity.
When investors give up any previous gains in stock price by selling equities in an effort to get out of the market and into less risky investments. True capitulation involves extremely high volume and sharp declines. It usually is indicated by panic selling. The term is a derived from a military term which refers to surrender. After capitulation selling, it is thought that there are great bargains to be had. The belief is that everyone who wants to get out of a stock, for any reason (including forced selling due to margin calls), has sold. The price should then, theoretically, reverse or bounce off the lows. In other words, some investors believe that true capitulation is the sign of a bottom.
An option that has the ability to change its structure, should certain pre-determined terms of the contract be met. An example of a chameleon option would be a put option that automatically changes into an identical call option after the price of the underlying exceeds a certain price. This is similar to a long or short straddle except investors aren't required to open two positions.
A Latin phrase for "let the buyer beware." The term is primarily used in real property transactions. Essentially it proclaims that the buyer must perform their due diligence when purchasing an item or service. In other words, consumers need to know their rights and be vigilant in avoiding scams. For example in the private purchase of a used car, caveat emptor places an onus on the buyer to make sure the car is worth the purchase price. This is because once the transaction is complete the buyer will not receive a warranty or return option from the seller.
Large companies that put less efficient and highly specialized merchants out of business. Category killers can attain this status by being cheaper, easier, bigger, or more popular than the competition. One of the best examples of a category killer is Wal Mart, their chain has put smaller stores in a wide range of specialized categories out of business.
Something that initiates or causes an important event to happen. Originally a term used in chemistry for the volatile (active) chemical in a formula. Quite often you will hear someone say that a stock needs a catalyst. This means that the stock needs some good news or a press release to get people interested in the stock again.
A federal energy efficiency program introduced in the fall of 2009. Commonly referred to as cash for refrigerators, in reference to the cash for clunkers program that operated during the summer of 2009, the program offers U.S. customers a rebate of up to $200 when buying a new, energy efficient home appliance. The cash for refrigerators program was introduced on the heels of the controversial cash for clunkers subsidy which saw over 690,000 new vehicles purchased over the course of the program, totaling over $2.9 billion. The United States Congress set aside $300 million for the appliance energy efficiency program.
1. One of the four categories (quadrants) in the BCG growth-share matrix that represents the division within a company that has a large market share within a mature industry. 2. A business, product or asset that, once acquired and paid off, will produce consistent cash flow over its lifespan. 1. A cash cow requires little investment capital and perennially provides positive cash flows, which can be allocated to other divisions within the corporation. These cash generators may also use their money to buy back shares on the market or pay dividends to shareholders. 2. This term is a metaphor for a dairy cow that produces milk over the course of its life and requires little maintenance. A dairy cow is an example of a cash cow, as after the initial capital outlay has been paid off, the animal continues to produce milk for many years to come.