| P/B
Ratio |
Price
to Book Ratio - A stock analysis statistic in which the price of
a stock is divided by the reported book value (as of the date specified)
of the issuing firm. |
| P/C
Ratio |
Price
to Cash Flow Ratio - A financial ratio that compares stock price
with cash flow from operations per outstanding shares. |
| P/E
Ratio |
Price
to Earnings Ratio - A stock analysis statistic in which the current
price of a stock (today's last sale price) is divided by the reported
actual (or sometimes forecast) earnings per share of the issuing
firm. A popular way to compare stocks selling at various price
levels.
|
| P/S
Ratio |
Price
to Sales Ratio - A financial ratio that compares stock price with
sales per share (or market value with total revenue). |
| Paper
Profit / Loss |
An
unrealized profit or loss on a security still held. Paper profits
and losses become realized only when the security is sold. (see Profit
- Taking) |
| Par |
Equal
to the nominal or face value of a security. |
| Participating
Preferred |
A
preferred stock, that is entitled to its stated dividend, and, also,
to additional dividends on a specific basis upon payment of dividends
on the common stock. |
| Partnership |
A
business relationship in which two or more people agree to share
the risks and profits of running a business. |
| Passed
Dividend |
Omission
of a regular or scheduled dividend. |
| Pattern
Day Trader |
A "pattern
day trader" is defined as an account that makes 4 round-trip
day trades (buying and selling the same security in one day) in any
rolling 5 business day period. As of September 28, 2001, new, more
stringent margin requirements
are in effect for pattern daytraders, requiring a minimum of $25,000
in equity or cash to be eligible for margin accounts. In return for
the more stringent requirements, a day trader that qualifies for
a margin account will be granted a margin of up to 4 times the underlying
cash (i.e an account with $30,000 in cash may purchase up to $120,000
in securities). (see Day
Trading) |
| Payment
Date |
The
date on which a dividend or split will be paid to stockholders by
the issuers' paying agents. The payable date is the date on which
one must own the shares (at the close of the session) in order to
receive the split. |
| Penalty
Bid |
A
Syndicate Penalty Bid can be used on the Nasdaq System during the
period of a registered public offering of a security. Such a bid
may be entered by the managing underwriter or a member of the underwriting
group acting on its behalf, and is intended to facilitate the offering
by stabilizing the price of the security during the distribution
period. |
| Penny
Stocks |
Low-priced
issues, often highly speculative, selling at less than $1 a share.
Frequently used as a term of disparagement, although some penny stocks
have developed into investment-calibre issues. |
| Phone
Switching |
In
mutual funds, the ability to transfer shares between funds in the
same family by telephone request. There may be a charge associated
with these transfers. Phone switching is also possible among different
fund families if the funds are held in street name by a particpating
broker/dealer. |
| Pivot |
Price
level established as being significant by market's failure to penetrate
or as being significant when a sudden increase in volume accompanies
the move through the price level. |
| Point |
In
the case of shares of stock, a point means $1. For bonds, a point
means $10, since a bond is quoted as a percentage of $1000. A bond
that rises 2 points gains $20 in value. In the case of market averages,
the word point means merely that and no more. If, for example, the
NYSE Composite Index rises from 80.15 to 91.15, it has risen 11 points.
A point in this index, however, is not equivalent to $1. (see Index) |
| Point
and Figure Chart |
A
price-only chart that takes into account only whole integer changes
in price, i.e., a 2-point change. Point and figure charting disregards
the element of time and is solely used to record changes in price. |
| Portfolio |
Holdings
of securities by an individual or institution. |
| Pre-Market
High |
The
Pre-Market high represents the highest price a person purchased this
security during the Pre-Market session. Investors trade in the Pre-Market
(8:00-9:30 a.m. ET). |
| Pre-Market
Last Sale |
An
electronic entry by an NASD Member firm representing the price involved
in a transaction of a Nasdaq security during the Pre-Market session.
The trade report must be submitted to Nasdaq within 90 seconds after
the execution of the trade. Investors trade in the Pre-Market (8:00-9:30
a.m. ET). |
| Pre-Market
Low |
The
Pre-Market low represents the lowest price a person purchased this
security during the Pre-Market session. Investors trade in the Pre-Market
(8:00-9:30 a.m. ET). |
| Pre-Syndicate
Bid |
A
Pre-Syndicate Bid can be entered in the Nasdaq System to stabilize
the price of a Nasdaq security prior to the effective date of a registered
secondary offering. |
| Preferred
Stock |
A
class of stock with a claim on the company's earnings before payment
may be made on common stock and usually entitled to priority over
common stockholders if the company fails or liquidates. Preferred
stock also is entitled to dividends at a specified rate when declared
by the company's board of directors and before payment of a dividend
on the common stock. Preferred stock normally does not include voting
rights. (see Common
Stock) |
| Premium |
The
amount by which a bond or preferred stock may sell above its par
value. For options, the price that the buyer pays the writer for
an option contract ("option premium" is synonymous with "the
price of an option"). May refer, also, to redemption price of
a bond or preferred stock if it is higher than face value. (see Discount) |
| Previous
Day's Close |
The
previous trading day's last reported trade. |
| Primary
Distribution |
Also
called primary or public offering. The original sale of a company's
securities. (see Investment
Banker) |
| Primary
Market |
The
process by which a corporation's stock is issued for the first time.
It is then sold to the public on the secondary
market. |
| Prime
Rate |
The
lowest interest rate charged by commercial banks to their most creditworthy
and largest corporate customers; other interest rates such as personal,
automobile, commercial and financing loans are often pegged to the
prime. |
| Principal |
The
person for whom a broker executes an order or dealers buying or selling
for their own accounts. The term "principal" may also refer
to a person's capital or to the face amount of a bond. |
| Profit-Taking |
Selling
stock which has appreciated in value since purchase, in order to
realize the profit. The term is often used to explain a downturn
in the market following a period of rising prices. (see Paper Profit) |
| Profit
Margin |
Indicator
of profitability. Determined by dividing net income by revenue for
the same 12-month period. Result is shown as a percentage. |
| Program
Trading |
Trades
based on signals from computer programs, usually entered directly
from the trader's computer to the market's computer system and executed
automatically. |
| Prospectus |
A
document that provides details about a new offering of securities
for sale to the public. It gives a detailed financial background
of the issuing company, how the proceeds of the securities will be
used, and other pertinent information investors will need to make
an informed decision. |
| Proxy |
Written
authorization given by a shareholder to someone else to represent
him and vote his shares at a shareholders' meeting. |
| Proxy
Statement |
Information
given to stockholders in conjunction with the solicitation of proxies. |
| Prudent
Man Rule |
An
investment standard. In some states, the law requires that a fiduciary,
such as a trustee, may invest the fund's money only in a list of
securities designated by the state - the so-called legal list. In
other states, the trustee may invest in a security if it is one that
would be bought by a prudent man of discretion and intelligence,
who is seeking a reasonable income and preservation of capital. |
| Public
Offering |
(see IPO -
Initial Public Offering) |
| Put
Option |
An options contract
that gives the holder the right to sell (or "put"), and
places upon the writer the obligation to purchase, a specified number
of shares of the underlying stock at the given strike
price on or before the expiration date of the contract. (see Call
Option) |
