Finance Dictionary ( daily finance terms and concepts will be added and discussed)

Odd Lot
An amount of a Security that is less than the normal unit of trading for that security. Generally, an odd lot is fewer than 100 shares of stock or five bonds.
 
Odd Lot Theory
A technical analysis theory based on the assumption that the small investor is always wrong. Therefore, when odd lot sales are up – which means small investors are selling stock -- it is probably a good time to buy.
 
Offset
To liquidate a futures position by entering an equivalent but opposite transaction. To offset an initial purchase, a sale is made; to offset an initial sale, a purchase is made.
 
Operating Margin
A Value Line measurement defined as operating earnings (before deduction of Depreciation, Depletion, Amortization, Interest, and income tax) as a percentage of sales or revenues.
 
Option
A security that represents the right to buy or sell a specified amount of an underlying stock, bond, futures contract, etc. at a specified price within a specified time. The purchaser acquires a right, and the seller assumes an obligation.
 
Other Current Assets
A balance sheet item. The value of non-cash assets -- such as prepaid expenses and accounts receivable -- due within one year.
 
Other Long Term Liabilities
A balance sheet item. Value of leases, future employee benefits, deferred taxes, and other obligations not requiring interest payments that must be paid over a period of more than one year.
 
Over The Counter
Abbreviated OTC. The term used to describe a security that is traded through the telephone- and computer-connected OTC Market rather than through an exchange.
 
Over The Counter
Abbreviated OTC. The term used to describe a security that is traded through the telephone- and computer-connected OTC Market rather than through an exchange.
 
Over The Counter Market
Abbreviated OTC Market. The security exchange system in which broker-dealers negotiate directly with one another rather than through an auction on an exchange floor. The trading takes place over computer and telephone networks that link brokers and dealers around the world. Both listed and OTC securities, as well as municipal and U.S. government securities, are traded in the OTC market.
 
Par
Also known as Face Value, Principal, and Stated Value. (1)The face value of a bond-- generally $1,000 for corporate issues and higher denominations for many government issues. (2) A dollar amount assigned to a security when first issued. For stocks, par is usually a small dollar amount that bears no relationship to the security’s market price.
 
Passive Income
Earnings derived from a rental property, limited partnership, or other enterprise in which the individual is not actively involved. Passive income therefore does not include earnings from wages or active business participation, nor does it include income from dividends, interest, and capital gains.
 
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