Banking and Stock Glossary
Warrants that are issued without the simultaneous issue of a warrant-linked bond. Unlike traditional warrants, naked warrants are not connected with the company's financing plans. They are primarily issued by banks and securities underwriters. In many cases, a cash settlement is provided for instead of the acceptance / delivery of the underlying. Naked warrants can be both call and put warrants. Covered warrants are a sub-category of naked warrants.
Abbreviation for National Association of Securities Dealers Automated Quotations. NASDAQ is a New York-based computerized exchange on which especially growth-oriented and innovative securites are traded. The index of the NASDAQ is the NASDAQ Composite.
Also: negative covenant. In the context of long-term loans and bonds, a negative covenant is an obligation on the part of a debtor not to encumber certain assets or not to encumber them at a higher rate - in particular real property - as security to a lender or not to grant other lenders any pieces of collateral without allowing the present lenders to participate equally in this.
The net asset value (NAV) of a mutual fund corresponds to its total assets minus its liabilities. The price per unit (net asset value per share) is calculated by dividing the NAV of a fund by the number of outstanding units. In the case of open-ended funds the price at which a unit-holder can sell shares is known as the bid price.
Netting is the agreed offsetting of reciprocal obligations by trading partners or participants in a system, including the netting of trading obligations, for example, through a central counterparty, as well as agreements to settle instructions to transfer securities or fund assets on a net basis. The result is that delivery and payment obligations arising from trading are netted to reduce the number of settlement transactions.
New shares stem from capital increases and do not or do not fully entitle their shareholders to receive a dividend for the ongoing financial year. First after the following dividend payment date are they equivalent to "older" shares. In the event that there are two capital increases in a financial year, the shares last issued are called "newest shares". The existing shareholders usually have a right to subscribe to the new shares. By purchasing them, shareholders can maintain their percentage holding in the company's share capital even after the capital increase.
Founded in 1792, the New York Stock Exchange (NYSE) is the most important stock exchange in the world. Shares of the largest U.S. stock corporations are traded on the NYSE. NYSE Group Inc. is a holding company and operator of the trading platform as well as a listed company. Synonym: Wall Street. www.nyse.com
See new shares.
Safe for depositing cash, cheques, bills of exchange and other documents outside business hours and for which the 'Conditions for the Use of Night-and-Day Vaults' are applicable.
No par shares are pseudo no par value shares. They represent a specific amount of share capital specified in the articles of association. In contrast to par value shares, however, this amount is not expressed in a cash amount; rather, the share certificates specify a certain number of shares, for instance 10 or 1,000 shares. The individual shareholder's stake and the scope of his rights are determined by the relationship of the number of shares he holds to the total number of shares issued. The amount of share capital attributed to a single share must be at least EUR 1. Any capital increase leading to a change in the stake merely requires a change in the articles of association but does not require an adjustment of the share certificate.
Instead of indicating a fixed amount of capital, no par value shares certify only a share ownership in the company without specifying its nominal or relative value, or a percentage of the share capital of the company. The share can represent a portion of the ordinary share capital (pseudo no par value share) or a percentage of the entire assets of the company (real no par value share).
Contractually agreed interest rate based on the nominal value of a debt instrument.
In fixed-income securities, the nominal (or face) value is the sum to be repaid that bears interest. In shares, it is the proportional amount (par value) of the nominal capital indicated on the share certificate. According to German stock corporation law, the lowest par value is one euro.
A non-assessment certificate is issued by the local tax authority that an assessment of income tax will probably not be applicable for the taxpayer with unlimited tax liability (due to income below a certain level). As a result, the taxpayer is not assessed for income tax, which is why he is entitled to the total sum from the ownership in securities, such as dividends, interest payments, etc. The certificate is issued subject to revocation. Its period of applicability is limited to no more than three years and ends at the close of a calendar year.
Security in the name of a specific person. The claim evidenced by a non-negotiable instrument can only be asserted by that person or his legal successor. The security is transferred according to in personam principles (§§ 398 pp. German Civil Code) either through agreement, assignment or transfer of the certificate. Only the respective holder of the right is entitled to ownership of the certificate.
Term for historical securities that have lost their value and are no longer traded (collector's items). Also used for securities in circulation that have a particularly low value.
No-par value shares do not have a fixed monetary value but are issued as a share in the company without specifying a nominal or relative size or portion of the share capital of the company. The share may represent part of ordinary share capital (pseudo no-par-value share) or a share of the total assets of the company (real no-par-value share).
A bank's transaction in securities for its own account; proprietary trading
This is a bank account that is maintained under the account number. Although the name and address of the accountholder are known to the bank, they are kept secret internally. This form of keeping accounts is prohibited in Germany but wide-spread in Switzerland.
See New York Stock Exchange.
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